In some industries, such as nursing, the recession is almost a silver lining in the black cloud – it’s keeping some older workers on the job beyond the time they intended to retire.
Two-thirds of Americans 55 to 64 are in the workforce—the highest participation rate among that age group since the Bureau of Labor Statistics began keeping track in 1948.
Examples of similar deferred retirements show up across the nation.
The American Institute of Certified Public Accountants said 35 percent of its financial-planning professionals’ clients said they were postponing leaving the workforce because of the economy. The institute said two-thirds of the clients who said they would delay retirement expect to work an additional five years.
Ten years ago, 59 percent of the 55-to-64 age group was in the workforce. In May, that jumped to 65.6 percent, with 1.6 percentage points of the growth occurring since May 2008.
Among workers 65 and older, the labor force participation rate has grown even more precipitously. In May 1999, the participation rate was 12.5 percent; in May 2008, 16.6 percent; and in May 2009, 17.2 percent.
“What this suggests is that 70 is the new 65,” Institute Vice President James Metzler said in connection with the report’s release.
This lack of turnover due to slower baby boomer retirements is creating a false sense of security for many businesses. Just because the sun came out doesn’t mean the roof stopped leaking. The longer Boomers stay, the more frustrated Gen X get frustrated by the Gray Ceiling. Generation Y are also being turned away due to a lack of openings.
Celebrating slower turnover due to delayed boomer retirements and ignoring the consequences of the delayed hiring and promotion of younger workers may come back to bite these businesses when business picks up and the competition for talent heats up. Every organization needs to take a look 3 to 5 years out at their workforce demographics and plan accordingly. Ignorance is not bliss when it comes to workforce planning.
Read more about the Gray Ceiling and other trends in my new book, Geeks, Geezers, and Googlization.