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What's Going to Happen When Boomers Retire?

By Mary Lloyd

This year, the first baby boomers turn 65. They will continue to do so at the rate of about 10,000 a day for the next 18 years. The start of 2011 has spawned a lot of rhetoric about what that means. But what does it mean-for your business, for the national economy, for our overall well-being?

For decades, the baby boom has been the source of frustration from some, excitement for others, and concern for most. That 18-year span represents about 25% of the total populations of the US-more than any other generation in the history of the country. As they went to school, it meant more classrooms. As they hit the workforce, it meant a larger labor pool to draw from. As they became consumers, it meant a bigger market for whatever you were trying to sell.

Now what? There are two distinctly different scenarios emerging about how things will look like when the boomers retire.

Greedy "Takers"?
If you choose to see what's coming as a repeat of what's already occurred, they will create a massive load on both Social Security and Medicare. There are simply too many who qualify for services now provided to not overload the system. Those who assume this scenario expect both systems to fail absent major changes in entitlements. Some even project "class" warfare where the old insist on their entitlements at the expense of everyone else.

Eager "Givers"?
Experts such as Ken Dychtwald and Marc Freedman are pointing to this mass of potential as the source of a whole new awakening for individuals and the country. They see the fact that the baby boom has reached their "elder years" (and they hate that word) as the trigger for something good. Very good. As boomers have time that was previously needed to earn a living, they will step up to fill needs within their communities with wisdom and compassion that can only come with age.

But there's more going on than either of these scenarios lays out. Just as with any generation, there will be those who take advantage of the system and those who step up to deal with problems they personally could easily ignore. And just as with any generation, there will be more or fewer in these two categories based on how the culture as a whole handles the situation.

How Boomers Will Be Different
The big difference with the baby boom is that this generation is not at all good at accepting "what is" simply because it's already in place. Perhaps because of the post WWII optimism, perhaps because of its sheer numbers, this generation has taken a stand on what it decides isn't right-racism, the Vietnam War, gender inequality. Some see this as self-absorbed but that word simply doesn't ring true. The protests were not for their own benefit even in the 1960's If they stay true to form, what they will be fighting to change next will bless those who come after.

And that is?

AGEISM

What we do about our outmoded assumptions of what people over 65 are capable of will decide whether we live in a country burdened with massive entitlements or one that reinvents itself as a world player by using its entire range of talent rather than relegating 25% of it to the discard pile as it reaches the false "expiration date" of age 65.

Let them work!
A Merrill Lynch study done in 2005-before the economic meltdown--found that 83% of the 2400+ boomers surveyed wanted to do some kind of paid work in retirement. This is at odds with those who have not yet retired who see "work in retirement" as an oxymoron. But creating a business environment that fosters this kind of work is the best road out of a potentially disastrous situation. Giving older workers a role accomplishes more than just improving the dollar amount they will draw from Social Security once they file:

  • Older workers who continue to work continue to pay in to Social Security and Medicare helping keep the system solvent.
  • People who continue to work are healthier and require less medical attention-with a reduced burden on Medicare.
  • People who are still earning are more active as consumers which will increase our economic viability.
  • Keeping older talent on the payroll gives businesses the benefit of what they know and can do for a longer time frame.

What's a Business to Do?
Think now about how to keep them onboard. Shape work so it can be done in less than a 40-hour work week. Study what active older adults might need and design those products. Such changes won't just be good for aging boomers; they will define a better world for Generation X, Generation Y, and those who are not yet in the workforce.