Involvement + Engagement. Sloan Center on Aging & Work. The New Context of Later Life: Rethinking the Education, Work, Leisure Paradigm. What's Ahead?

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1 Sloan Center on Aging & Work The New Context of Later Life: Rethinking the Education, Work, Leisure Paradigm April 24,2014 Founded in 2005: Alfred P. Sloan Foundation Grant Quality of Employment Framework Research Evidence for Action US/National State Global Jacquelyn James, Ph.D. Research Director Research Professor Lynch School of Education What's Ahead? New Context of Aging Context of aging & work today what s going on? Can older workers continue? This year s research the Time & Place Management (TPM) Study What can employers do? What can policy-makers do? The U.S. is aging - people are living longer than ever before. Older adults are healthier than ever before. The economy has affected plans of the retirement-eligible. Older adults want to be productive Engaged as We Age: Life and Times in an Aging Society Study Mental Health by Age Involvement + Engagement Mean Mental Health Score by Age Groups Age 39 or Younger Ages Ages Age 66 or Older Note: One-way anova used to test differences. Differences significant, p<.001. Age 65 or older significantly higher in Mental Health than the other age groups 1

2 Rewards of for Greater Engagement High engagement predicts greater outcomes of well-being compared to no involvement. Low engagement predicts lower outcomes of well-being As we age, it is better for our wellness to be uninvolved than it is to be involved and unengaged. Positive Views of Aging: The Third Age A Fresh Map of Life (Laslett, 1989) apogee of life era of personal fulfillment the crown of life Fourth Age = frail and dependent (can arrive slowly or quickly) Source: Matz-Costa, C., Besen, E., James, J.B. & Pitt-Catsouphes, M. (2014). Differential impact of multiple levels of productive activity engagement on psychological well-being in middle and later life, The Gerontologist, doi: /geront/gns148. Emotional Selectivity The Particular Urgency of Mortality I no longer read books I m not interested in. I don t mind empty calories quite the opposite! but empty experiences grate on me more than before. If something is worth doing, it s worth doing today. If not, chuck it. Source: Alex Beam, The Boston Globe, Thursday, April 17, 2014 Brief History of the Normal Retirement Age Fixed NRA began 1889 in Germany--age 70 (later lowered to 65) when life expectancy was about 40 years FDR suggested age 65 for Social Security benefits in 1935 when U.S. life expectancy was 61. Life expectancy today in U.S. is 79. What s Your Retirement Job? 2

3 Why Do Older Workers Want to Continue Work? Do Older Workers Need to Work? Median Weekly Earnings of Full-time Wage-and-Salary Workers, by Age and Gender, 2013 Surveys consistently find that older workers (particularly those aged 50 and older) plan to work past the normal retirement age. 91% 81% 71% 61% 51% 96% 95% 83% 49% 61% Need the money Enjoy work Feel useful Older workers give many reasons for continued work: health & wealth; meaning & connection. 41% 31% 21% 11% 1% Health insurance Pension requirements Source: AARP, 2013 Source: BLS Employment and Earnings, 2013 (Table 41). Do They Need Employer-based Health Insurance? Source of Health Insurance Coverage among Individuals Aged Does Work Provide Meaning and Connection? Working makes you feel good about yourself.you re fundamentally useful. I need to work for my health insurance That s the main reason. I think it s a healthy situation to continue to work in some form, shape, or fashion, whether that s for monetary reward or challenges or give back all those things are important to staying intellectually healthy. Source: DeNavas-Walt, C., Proctor, B. D., & Smith, J. C. (2013). Income, poverty, and health insurance coverage in the United States: Washington, DC: U.S. Census Bureau (Table C-3). So, Does Work Benefit Older Adults? Added financial security (and perhaps health insurance) (Employee Benefits Research Institute, 2004) Are Older Workers More Likely to be Unemployed? Unemployment Rates by Age-- 12/2012, 11/2013 and 12/2013 Increased Social Security income from the Delayed Retirement Credit (Munnell, 2013) Increased assets because each additional year of work replaces a year in which assets would have been depleted (Cahill, Giandrea & Quinn, 2012) Added health and well-being outcomes (James & Wink, 2007) The question becomes.can they continue? Source: Rix, S. E. (2014). The employment situation, December 2013: Disappointing Year-End Numbers for Older Workers. Fact Sheet No. 299 Washington, DC: AARP Public Policy Institute. 3

4 But What Happens When They Are? Average Duration of Unemployment in Weeks by Age, January 2011 to January 2014 Could it be Due to the Age-old Problem of Ageism? Deeply ingrained, and socially sanctioned prejudice against the old i.e. ageism as the worst ism Levy & Banaji, Source: Rix, S. E. (2014). The employment situation, January 2014, and a Look Back at 2013: Fewer Older Workers Unemployed, More Our of the Labor Force. Fact Sheet No. 302 Washington, DC: AARP Public Policy Institute. Age Gender Sexual orientation Race Perceptions of Older Worker Research Spans 40 Years: Consistently Negative Preparing to Retire? Set in their ways Costly In physical decline Less Adaptable Childlike Washed up Less potential for development Forgetful Disinterested in training Not Open-minded Less qualified Cannot work with younger supervisors Slow learners More difficult to change behavior Cannot adapt to new technology Slow Repeat themselves Marking time until retirement Not interested in advancement Unmotivated Huh? U.S. Employer Assessment Qualities Valued (N=400) 1. Commitments to doing quality work 2. Get along with coworkers 3. Solid performance record 4. Basic skills in reading, writing, and arithmetic 5. Someone you can count on in a crisis 6. Willing to be flexible about doing different tasks 7. Loyalty and dedication to the company Attributes of Older Workers 1. Loyalty and dedication to the company 2. Commitment to doing quality work 3. Someone you can count on in a crisis 4. Solid performance record 5. Basic skills in reading, writing and arithmetic 6. Solid experience in job and/or industry 7. Get along with coworkers Source: AARP,

5 HR Managers Perceptions of the Likelihood of Age Discrimination at Stages of Employment N=603 What s the Harm? Intentional v. Unintentional Age Discrimination Intentional: If employees of all ages perceive that older workers are capable of promotion but also typically denied that opportunity.their employee engagement scores go down. Unintentional: If employees perceive that older workers are not really capable (can t adapt, do technology, keep up), and see them as being denied promotions, employee engagement scores are not affected. Source: James, J., McKechnie, S., Swanberg, J., & Besen, E. (2013). Exploring the workplace impact of intentional/unintentional age discrimination. Journal of Managerial Psychology 28(7/8, Emergent Perspectives of Older Workers Older Americans Exit the Labor Force Gradually, In Stages An illustration of the retirement process Ideal Situation for Next Stage Percent of Respondents Years of Age 17% 6% 6% Cycle betw een w ork and leisure Work part-time 42% Start ow n business Work full-time 13% 16% Never w ork for pay again Other Source: The Merrill Lynch New Retirement Survey. Available online at: Source: Cahill, K. E., Giandrea, M. D., & Quinn, J. F. (2013). Retirement Patterns and the Macroeconomy, : The Prevalence and Determinants of Bridge Jobs, Phased Retirement, and Re-entry among Three Recent Cohorts of Older Americans. The Gerontologist; doi: /geront/gnt146. Reasons for Choosing Semi-Retirement But Won t they Steal Jobs from Younger Workers? Similar arguments were made about women, but women s entry into the workforce has been an economic boom and created, rather than stolen jobs Economists show that throughout history, when older workers are continuing work, the economy grows. That said, there may be pockets where this is true, which makes the perception hard to refute. Source: HSBC (2013). The Future of Retirement: Life After Work? 5

6 What do employers need to do? A Tale of Two.the Time & Place Management Study ModMed Access to new flex schedule/flex place options (experimental group) Training to help mgrs. and employees initiate and engage in discussion of options (80% of 3,890 employees have completed; 76.6% of 342 managers have completed). Communication to motivate and indicate top management support Surveys of both managers (7) and employees (4) Last data collection January, Company A Training for managers (and employees) about business-relevant rationale and processes for flex discussions initiated by supervisors Tracking of progress shared with managers (6 waves of data) Study completed in June, Evidence of Treatment Effects at ModMed Preliminary Findings from ModMed The impact of the TPM initiative on work-life balance does not differ significantly between older and younger workers. Older and younger workers alike appear to have benefited. Manager assessments of team productivity and team attitude are higher among work units in which more than one third of employees are aged 50 or older compared with younger work units. The positive impact of the TPM initiative on manager assessments appears to be concentrated among the younger work units possibly because there is more room for improvement. The financial performance of work units (number of months over budget) is higher among older work units compared with younger ones. The positive impact of the TPM initiative on financial performance also appears to be concentrated among the younger work units again, possibly because there is more room for improvement. 33 Key Findings From Company A Women Managers Performed more TPM discussions Had higher flex use among supervisees Had higher flex expansion rates Older Managers Performed more TPM discussions Had lower flex expansion rates Favorable Attitudes Toward Flex or the SPF Program Resulted in more TPM discussions Corresponded with higher flex use among supervisees Resulted in higher flex expansion rates Favorable Attitudes Toward Flex or the SPF Program Resulted in more TPM discussions Corresponded with higher flex use among supervisees Resulted in higher flex expansion rates Beliefs that Promoting Flex Would Be Recognized Resulted in more TPM discussions Corresponded with higher flex use among supervisees Resulted in higher flex expansion rates 6

7 Redefining 20 th -Century Notions of Retirement I. Re-thinking current measures unemployment dependency ratios II. Policies Tax credit for training and development for older workers Support for entrepreneurs Flexibility across the life span III. Corporations Change approach to hiring, training and retaining talent Carstensen, L. (2011). A Long Bright Future: Happiness, Health and Financial Security in an Age of Increased Longevity. New York: Public Affairs. Carstensen, L. (2011). A Long Bright Future: Happiness, Health and Financial Security in an Age of Increased Longevity. New York: Public Affairs. Aging Population as Untapped Resource America s aging population is a great untapped economic resource. The right policy reforms and business practices could leverage this resource to unleash another century of American economic growth. But first a profound transformation is needed in how we think about work, activity, aging and retirement. Source: Wall St. Journal, 3/10/2014 7