Sunday, January 25, 2009

Retirement - what's that?

If the following statements from this week’s Business Week are correct, and I think they are, then there is a traumatic change taking place to the dynamics of the market. None of its ideas are new, but when they all appear in the same place it highlights the magnitude that is unfolding.

The recession is making clear what we've suspected for a long time. The concept of not working and embracing leisure for the last third of one's life isn't practical for most people.

Put it this way: Survey after survey has shown that a majority of aging baby boomers plan on working in retirement. Well, that plan is coming true.

A seismic shift in the economy and workplace is making it easier for an aging population to labour longer. An information- and services-dominated economy will ease the transition to longer working lives.

The day of retirement reckoning is here for less happy reasons, too. For the second time in eight years, savers have watched in horror as their pension savings and other retirement savings were hit with sharp declines. This time around, the household wealth destruction is even greater because of the nationwide fall in home prices.

But wait, there's more: The funding of social security is widely acknowledged to be broken and is a strain on family finances. Even with Medicare coverage (in the UK’s case the NHS) after age 65, the elderly are finding it necessary to pay for a greater percentage of their overall medical bill.

The solution: work longer.
The writer of the article throws in a few crumbs of hope.

More than making ends meet, work is physically and mentally energizing. It keeps the mind active and dementia at bay. For many people, the workplace is a social environment, with birthday celebrations and coffee klatches. To be sure, you may want to say goodbye to your current office mates for the last time. But that doesn't mean you won't want to work.

The next article in Business Week is about why “Hard-pressed companies forced to make layoffs tend to cut younger workers while retaining those over 55.”

This seems to be the reverse from what is happening in the UK.

The article continues…
Companies nationwide are laying off workers by the tens of thousands. But many are trying to spare the post-55 set from the axe, a reversal of the top-down trends in past waves of layoffs. They're being driven by legal concerns—since boomers are in a protected age group—and by a need to keep experienced hands in place to keep the companies running and positioned for an upturn. "Seniority matters," says the director of the Sloan Centre on Aging & Work at Boston College.
What the hell is going on?

Sorry, but don’t look to me for the answers. Right now all I can do is try and gather and understand the data.

But, just think about what all this means for a post-recession world. Yes, I know that seems a long way away but it is a place some of us might see. The scars of this recession will take years, decades to heal. What we marketers must do is to try and understand what the new market vista will look like and then get on with the job of modifying our marketing to take advantage of it. Dick Stroud

1 comment:

Cathy Warren said...

Yes it does appear we will all be working later in life. But I do agree that continuing in the workforce to some degree does benefit a person physically, emotionally and socially. Stay in the game to stay sharp!

Cathy Warren