The Aging Workforce: Employers Grapple With the New Reality of an Evolving Workplace

A growing segment of the population is working beyond the traditional retirement age. According to the Bureau of Labor Statistics, one-third of individuals ages 65 to 74 expect to be working in 2030, compared with 27% in 2020 and 19% in 2000.

Other changes to the professional landscape—e.g., an overall increase in job vacancies, a decrease in productivity and shifting attitudes toward workplace etiquette—point to the potential for the aging demographic to change the playing field for employers, especially as they face a tight labor market.

Employers must increase their knowledge about this growing segment of the workforce and understand how to meet its unique needs.

Understanding Employment Extenders

 

Voya Cares^® collaborated with Easterseals—the top national nonprofit for people with disabilities—to produce Employment Extenders: A labor (force) to be reckoned with, research that describes the mindset, motivations, wants and needs of individuals who still are working past retirement age.

This survey uncovered several key findings driving the changing workplace landscape, among them:

• Many say they are motivated to continue working because they either can or want to, but 92% of employment extenders also indicate they need or want more money for retirement.
• Employment extenders are not planning for the associated costs and increased likelihood of long-term care support for themselves or a loved one that could derail retirement savings.
• Employers that want to retain their aging workers amid a tight labor market may be able to help them—e.g., by creating benefits with clear monetary value—and thereby successfully position them for retirement when that day arrives.

One of the biggest needs that employment extenders have is for education concerning the topics they expressed interest in, such as:

 

• Transitioning into retirement;
• Maximizing their benefit dollars across health and wealth benefits; and
• Estimating income needs in retirement.

Employment extenders also want to understand the employee benefits offered to them. Employers can help meet their unique needs through targeted messaging and education, for instance explaining health savings accounts as a retirement savings vehicle and emergency savings accounts to help safeguard retirement nest eggs.

Distinct Motivations and Financial Needs

But employment extenders are by no means a monolithic group; they have different motivations, financial considerations and personal concerns that impact their work and retirement decisions. To better understand these differences, the group was sorted into unique personas.

Differences in motivations for continuing to work are at the crux of what makes these segments unique:

• Want to work: This group continues to work because it gives them a sense of purpose, yet they’ve saved the most compared with any other group and may be financially able to retire now.
• Part of the plan (or working longer by design): Those in this segment may always have planned to work longer for an enhanced quality of life in retirement, and they still enjoy working. They also are more likely to have retired once, gone back to work and may already be collecting a pension.
• Worriers: This group is likely working longer because they are afraid they are not ready to cover unexpected expenses. Planning and saving are top of mind concerns for this group, but they don’t necessarily like working.
• Need to work: This type is working past when they had hoped because they need the money today and when they retire. Even though they don’t necessarily like working, they may continue to work because limited resources make saving difficult.

Employees who are curious as to what segment they are most closely aligned with can take this short quiz and receive recommended next steps tailored to each employment extender persona.

 

The collective years of valuable experience that employment extenders bring to the workplace is a fundamental part of the workforce. A sharper understanding of this demographic can ultimately create a more unified workplace environment and pave a discernable retirement path for all employees.

The full research paper with expanded findings, resources and a video summary is available at voyacares.com/aging.