18% of the Workforce Could Retire Within Five Years

Social SecurityMy Comments: As American consumers, we have long been aware of how different generations have different needs and wants. When I complain about a stupid ad on TV, or one I don’t understand, my son is quick to point out that it was NOT directed at my age group.

I’m just ahead of the “baby boomer” generation, those born soon after the end of World War Two. Today, they comprise a high percentage of homeowners and buyers of stuff everywhere you go. Many of them are my clients. Those of us in financial services have been working closely with these folks for years, and there is a lot of criticism that many, if not most, are not ready for retirement.

While I tend to disagree with the average age of a retiree described below, as the baby boomers retire and leave the workforce, they are going to dramatically change the economic landscape for all of us.

For example, you may not like ObamaCare, but fast forward 15 years and realize that all those baby boomers are now starting to have serious health issues. The health care delivery system is likely to be overwhelmed. Who is going to look after all of us, especially if you limit immigration. Are you willing to pay a lot more so you can be looked after properly, or do you want a mechanism in place that forces ALL OF US to pay something into the system? You better hope ObamaCare gets streamlined and becomes efficient, or you will find yourself on the losing end.

By Michael K. Stanley | The National Underwriter | September 30, 2013

Eighteen percent of the workforce could retire within the next five years.

The finding, in a recent report by the ADP Retirement Research Institute, a research arm of the global provider of human capital management solutions, is an appropriate reminder of the heft of the Baby Boomer generation and the impact their ageing will have on society.

The report examined six industries industries including hospitality, public administration, manufacturing, health care, education and retail. The percentage of individuals anticipated to exit the workforce ranged from 9 percent in hospitality to 28 percent in public administration.

Many have contended that due to the financial crisis and increased life expectancy among various other factors, people will be working past traditional retirement age. For the purpose of the study, ADP assumed that the average retirement age was 61. Researchers concluded that in many industries, individuals will retire at 61 despite theories suggesting otherwise.

Although the run-off of Baby Boomers could help bring down a disproportionately high youth unemployment rate, many industries value their older, experienced workforce and fear the impending retirement wave.

“Retirement data provides a critical glimpse into the future of a company’s workforce. Businesses will want to assess how their workforces compare to the averages and consider strategies for recruitment and training in order to replace the significant loss of knowledge, experience and company culture that can be expected,” according Ahu Yildirmaz, Sr. Director, Market Insights at the ADP Research institute.