Call it the Great Recession Mindset, but whenever people talk these days about Boomers working longer it often seems the discussion is coming from an ominous point of view.
Because of dwindling savings, baby boomers are expected to work longer. Or, faced with rising costs, baby boomers must now delay retirement.
Basically, it all sounds like such an awful burden, but, in actuality, the decision to delay retirement is frequently made by choice, not out of necessity. People like to stay busy. They like to stay challenged. And yes, they like their jobs.
So a report by Barry Bluestone and Mark Melnik for the Kitty and Michael Dukakis Center for Urban and Regional Policy at Northeastern University in Boston should be welcoming news to Boomers. In After the Recovery: Help Needed, Bluestone and Melnik argue that between 2008 and 2018 there could be an estimated 14.6 million new nonfarm payroll jobs created, resulting in more jobs than people to fill them. Using projected population rates and current labor force participation rates, there will only be about 9.1 million additional workers to fill the available positions.
In other words, by 2018 there could be anywhere from 5 million to 5.7 million potential jobs that need to be filled.
“As hard as it seems to believe that we’re going to climb out of this recession and create so many jobs that firms are going to be begging for people to work for them, that’s what it looks like to me,” said Bluestone, the founding director of the Dukakis Center and the founding dean of the School of Public Policy and Urban Affairs at Northeastern. “What’s going to happen for the young kids coming out of college or high school is they’re once again going to find some pretty good job opportunities unlike the kids graduating this spring. And it’s going to mean tremendous opportunities for the baby boomer generation because they will be such a large part of the labor force.”
Bluestone said that the projections being made for employment “are not outlandishly high growth rates.” In fact, reaching the 14.6 million job figure by 2018 requires only about a 1% annual rise. That would be slower than the growth rates we had in 60s, 70s and 80s. The only thing that would impact these projected numbers, Bluestone said, would be immigration.
In the social sector, which is defined as health care and social assistance, educational services, nonprofit community and religious organizations, and government, there will be a total of 6.9 million new jobs. An estimated 4.3 million additional workers are expected to fill these positions, leaving 2.4 to 2.6 million potential jobs vacant.
Using data from the Congressional Budget Office, Bluestone and Melnik report that the total loss of output could be as high as $3 trillion across a five-year period beginning in 2018 if the full employment gap is not filled.
“There are many ways to fill the gap but one of them will be increased labor force participation by baby boomers,” Bluestone said.
According to the report, 55- to 64-year-olds are expected to increase their labor force participation rate to 68.1% from 64.5% between 2008 and 2018. But even taking into account increased labor force participation by Boomers, and even those older than Boomers, Bluestone and Melnik estimate that there would still be 3.3 million to 4 million jobs that could go unfilled between now and 2018.
This means that companies are going to have to restructure jobs to make them more attractive to older workers.
Bluestone said that there are going to be many Boomers who are going to continue working because they absolutely have to, either because they don’t have the savings or because they are low-income workers who just have to put food on the table. But what this study suggests is that they are going to have an easier time finding work, he said.
Boomers who are not struggling may decide to pursue an “encore career” in something that helps improve the communities where they live. This could mean working in the social sector. One of his friends, for example, is leaving the company he’s at right now and plans on spending the next 10 or 15 years working in nonprofits to help others.
Bluestone said the health care reform bill that just passed means that an estimated 32 million more Americans will now have insurance. This will likely translate into a job boom in the health care industry.
“For those in reasonably good financial health, they’ll be able to retire from their regular job and find something they may find more satisfying,” he said.