Employer Survey: 1 of 4 Boomers Won’t Retire Because They Can’t

Alicia Munnell, Steven Sass () and Aubrey, Jean-Pierre
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Steven Sass: Center for Retirement Research, Boston College
Aubrey, Jean-Pierre: Center for Retirement Research, Boston College
Authors registered in the RePEc Author Service: Steven A. Sass () and Steven A. Sass ()

Issues in Brief from Center for Retirement Research

Abstract: The Baby Boom generation is now on the cusp of retirement, with the oldest Boomers 60 years old. As this huge generation makes its way out of the labor force, it will do so on much different terms than those offered workers over the past quarter century. The share of earnings replaced at any given age by Social Security and employer plans will be less. And that income stream will also be less secure. Many observers are thus concerned that Boomers will be unprepared for retirement. However, if Boomers can delay retirement, they can raise their retirement income far more than could workers in the past. Working longer has thus emerged as an important option for improving retirement income security. Employers have a unique perspective on whether workers are prepared for retirement and on when they will retire. Employer-sponsored defined benefit pension and 401(k) plans are the most important source of retirement income for the nation’s workforce, aside from Social Security. Moreover, employers must be able to predict when their older workers will retire in order to make effective staffing, training, and promotion decisions. And if continued employment is to emerge as a viable response to retirement income shortfalls, employers must be willing to create opportunities for work at older ages. To gain the employer perspective on these issues, the Center for Retirement Research conducted a nationally representative survey of 400 employers. This brief reports on employer estimates of how many workers, currently in their 50s, will have the resources needed to retire at the organization’s traditional age and how many unprepared workers will respond by opting to extend their careers. A second brief will report on employers’ likely response to workers who will want to remain on the job.

Keywords: baby boomers; baby boom generation; delay retirement; working longer; retirement incoming; raise; defined benefit pensions; 401(k) plans; social security; sources of income; shortfalls; employer estimates; employer attitudes (search for similar items in EconPapers)
Date: 2006-12, Revised 2006-12
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