When Voluntary Retirement Is Not So Voluntary

It wasn't so long ago that employers could usher you out the door because you had celebrated a birthday that made you "too old to work" in the eyes of some of them. With the passage of the Age Discrimination in Employment Act (ADEA) in 1967, Congress decreed that couldn't happen before age 65, and in 1986, mandatory retirement was eliminated for most occupations. Most of us can now work as long as we want, assuming the jobs are there and we are able to do the work. Employers cannot retire us just because of our age; however, they need not retain us for that reason either. We have the right to work along with the responsibility of ensuring that we have the requisite skills and abilities.

Yet only a minority of workers remain in the labor force much after age 65. As of October 2013, 8.1 million Americans aged 65 or older, or 18.4 percent of that age group, were working or looking for work.

Workers retire for a variety of reasons, one of which is that they are ready to move on, and the time seems right. They have set goals and objectives for a life beyond work and voluntarily leave.

There are some signs, however, that not all "voluntary" retirements occur fully by choice. Subtle pressure to move on may be behind some "free-will" decisions to stop working, suggests a new publication from the Society of Actuaries (SOA) Committee on Post-Retirement Needs and Risks. The Decision to Retire and Post-Retirement Financial Strategies summarizes eight focus group discussions on retirement decisionmaking with men and women who had been retired for up to 10 years as of May 2013. These retirees were "resource constrained," that is, they had some savings but not necessarily enough to maintain pre-retirement lifestyles or to live worry-free throughout retirement. They had nonetheless opted to retire.

Focus group participants are not randomly selected, representative samples, so what these retirees said does not necessarily apply to all retirees. Still, the sometimes wide-ranging discussions in focus groups often provide more detail and digressions than structured surveys and offer insight about issues that may warrant systematic study. One of those issues involved how the focus group retirees happened to retire in the first place. In many instances, it was not because they were lured into retirement by the promise of leisure and opportunity to do new things. Rather, the report notes, many felt they had been pushed out because work became "too difficult or unpleasant," sometimes as a result of a sense that their employers no longer wanted them or because they no longer felt respected or needed. "Opportunities came to younger people and to me it was a sign that you'd better start thinking about it [i.e., retirement]."

In addition, some workers felt they were no longer strong enough to do the job, or pain or other discomfort proved challenging: "I wasn't able to sit for long periods of time," said one participant. "The type of job I was doing, I was sitting all day long." But this woman loved her job and wanted to continue working.

For others, job stress or frequent travel became more than they wanted to cope with: "It was just too much. Too many reports, too many phone calls." "Central office was not the catalyst, but it played a bit part, because there was always more, more, more to do, and never anything taken away."

These workers were not incapacitated; they could work, and they possessed skills, experience, and expertise that could likely continue to benefit their employers and that might be hard to replace. Relatively modest job accommodations might have mitigated some of the difficulties they faced. More flexible work schedules, including phased retirement, as well as job sharing, shifts to less demanding work, and job redesign are among the ways that some innovative employers attract and retain workers of all ages. For example, to meet production goals in the face of a projected sharp increase in the average age of its workers, German auto manufacturer BMW introduced adjustments such as wooden floors that are easier on the knees, larger type computer screens, chairs that allow laborers to work sitting down, and easier-to-access cars on the assembly line. The changes enhanced productivity, benefited workers of all ages, and were not expensive.

BMW isn't the only company that values its older employees and aims to retain them longer. Another prime example is the National Institutes of Health (NIH), at the top of AARP's 2013 Best Employers for Workers Over 50. NIH offers a wide range of benefits likely to appeal to older workers, including flexible work schedules, job sharing, phased retirement, and telecommuting. A recent Washington Post article on this winner notes in particular fitness programs "created for older bodies" and cites NIH's deputy director of human resources, who reports that the benefits evolved as young scientists aged.

NIH's benefits reflect an acknowledgment that older scientists still have a tremendous amount to contribute, as they did when they were younger, and that keeping them on the job and fit enables them to make those contributions.

Actuary Anna Rappaport, Chair of the SOA's Committee on Post Retirement Needs and Risks, knows that eliminating mandatory retirement was only one step in the march to prolonging worklives. She argues that "we need more employers like NIH who understand what a valuable resource older workers are. Relatively small changes in schedules, assignments, and tasks, along with zero tolerance for ageism, could make workplaces more welcoming to older workers who want to work and can do the job. Had these been available to the retirees we spoke with, more of them might still be on the job."

Employment Update: November's employment update by the Bureau of Labor Statistics showed nonfarm employment growth of more than 200,000 but no improvement in the unemployment rate for either the total workforce or the older (aged 55+) workforce.

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