Nearly two centuries ago, lexicographer Noah Webster defined “retire” and “retirement” as a form of withdrawal: retiring for the evening, for example, or retiring from public life. But retiring to pursue hobbies and spend more time with the grandchildren while living off a lifetime’s worth of savings invested in stocks and bonds? No.
Back when Webster was doing his defining, 70% of white men over the age of 65 worked for a living. Official rates for women were lower.
Source:
https://www.theatlantic.com
The toil-until-you-die mentality was arguably a necessity, particularly on family farms where most Americans lived and worked at the time. Historians have also argued that it reflected respect for the elderly, who accumulated useful knowledge about farming over the course of their lives. The small-scale industrial enterprises that were just beginning to transform the U.S. economy also employed the old, but for different reasons. These firms often depended on family and community connections to recruit and retain workers. Owners and managers realised that putting older relatives to work would help them hire younger labourers as well.
Factories grew larger, but managers kept graying workers on the payroll. Some did so out of compassion, but others believed that older employees were more conservative and consequently less likely to succumb to radicalism and strikes. They could also be employed as reserves during times of labour unrest.
Beginning in the 1890s, though, men over 65 began to “retire” from the workforce. This shift arguably began when late-19th century unions and progressives pushed to reduce the length of the working day, which often lasted between 10 and 12 hours. They demanded an eight-hour day, and eventually, a five-day work week.
As reformers made inroads, companies became increasingly sensitive to productivity issues: They now needed to produce the same amount as before, but with far fewer hours. Inefficiencies that might have been acceptable in the past now became intolerable. This spelled trouble for older workers.
As Americans internalised the idea of retiring, they lost touch with its problematic origins. This amnesia made it difficult to imagine alternatives to retirement that did not involve a full-scale separation from the workplace, such as part-time work or other flexible arrangements.
And now that leaves the United States in an increasingly untenable position as it confronts a persistent labour shortage. The workforce participation rate for people over the age of 65 is stuck at 23%. In fact, many of the unfilled positions are in professions that are likely to continue seeing high demand even in a recession – teachers, for example.
There is a solution. Greater acceptance of flexible or “phased” retirement would enable older workers to retain an income while still spending more time on leisure. This approach can help alleviate shortages of workers, and it may also lessen the burden on the social safety net by keeping seniors engaged and active.
Companies and public agencies should put more effort into extending such part-time opportunities to their older workers instead of thinking of retirement as being either an all-or-nothing stage of life.
In Malaysia, we have older folks with low-savings. It is difficult to retire unless you have savings of at least RM250,000 in present day terms. This is a bare minimum, and many don’t even have more than RM10,000 in their EPF at 60. So, flexible arrangements are the way forward. Perhaps working in a part-time arrangement to 75 will help. If one keeps well, i.e. mentally and physically fit, it is possible. It also reduces the possibility of early onset of dementia or stroke. Perhaps, insurance companies, medical institutions and the Government could work towards a scheme for senior part-timers who are willing and able to work to 75!
Reference:
Ready to work until you die? America needs you, Stephen Mihm, The Star, 10 Sept 2022
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