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Gray backlash? (…or should we call it “silver?”)

(Note added July 16: “Every silver lining’s got a touch of grey.” (YouTube video at Mountain View‘s Shoreline Amphitheatre) Grateful Dead, “Touch of Grey

Two articles today are dovetailing into a prediction in my mind.

The articles…?

“47% of early boomers could run shy of cash” in CNNMoney.com discusses the prediction that many early baby boomers may have a hard time making ends meet in retirement, according to a study by the Employee Benefit Research Institute. The study predicts that 47% of baby boomers between the ages of 56 andd 62 are likely to run shy of the cash they’ll need to pay for basic expenses and uninsured health costs in retirement.

This study says that the big culprit is uninsured health costs, and suggests that the early boomers can SAVE MORE! :-) Predictably, the more money you make now, the generally better off you will be in retirement. (Note added August 22, 2010: Another “coincidence:” :-) Predictably, the more money you make now, the more likely that you are in the group LAYING OTHER PEOPLE OFF rather than in the group getting laid off, yourself [most of the time].)

The second article is this one,  from San Jose, California, about “More Seniors Looking for Work.” The big change there…?

For the first time on record, senior citizens are outnumbering teens in the labor market!

“According to data compiled by Bloomberg News, there are 6.6 million people over the age of 65 working or looking for work, compared to 5.9 million young people, the first time seniors have passed teens in the labor market.”

Bill Sundstrom, an economics professor at Santa Clara University said that the crossover is not really all that surprising. I AGREE, but for some additional reasons, as well.

“People are living longer and staying healthier longer on average so the number of seniors in the workforce is likely to have been increasing steadily,” said Sundstrom.

Sundstrom said that the recession has made the problem worse for teens, as older workers have delayed their retirement.

Bill Sundstrom, being an economics professor, is well aware of demographics. I wrote about the demographics of the baby boomers in November of 2007 (so, if you are still surprised at this late date, go back and read that entry). :-) THESE ARE UNUSUAL TIMES! In that blog entry, I cited a published article that was not stored by the publisher online for much time at all! (Note added July 17, 2010: No worries! :-) The same article was covered by USA Today, here!) I said:

“Although Congress as done little, Business (with a capital “B”; and perhaps especially High Tech companies, of which California has a bunch!) has done even less, by taking short-sighted actions that will actually make the coming train wreck even worse. According to the article, by 2030, Social Security’s caseload will be 84 million people (up from 50 million today) and Medicare will go from 44 million current beneficiaries to 79 million.”

“In 2030, according to the article, there will barely be more than two workers paying payroll taxes for every retiree. I do not envy them.”

(Note added October 23, 2010: Guess what? The BIRTHRATE in the U.S. is declining, so much so that the population is not replacing itself and will decline, too! This means that there will be EVEN FEWER workers paying payroll taxes to support the increased population of retired folks!)

What are these short-sighted actions taken by Business? One of them is LAYING OFF BABY BOOMERS IN THEIR 50s (sorry to “shout” – someone out there is hard of hearing :-) ). Since Social Security payments start at 62 at the earliest, folks laid off in the 50s must find a way to bridge the gap. The advice, “SAVE MORE” of the CNNMoney article is meaningless to them, and sounds like something uttered by Ebenezer Scrooge. :-) Corporations, don’t expect such seniors to vote for “tax breaks” for YOU! (And there are A LOT of us…!)

(Note added July 17, 2010: Baby boomers, just remember in the upcoming elections that the candidates WHO WANT TO TAX CORPORATIONS LESS [you know, the corporations that off-shored your job and laid you off early :-) ], really want to TAX YOU MORE [at least in the short term]. Face it, there is nowhere else to get the money! Baby boomers are the big bulge in the Middle Class! Teenagers are out of work [seniors have taken their jobs]! And by 2030, there will barely be more than two people working to support each retiree… assuming that those people have not had THEIR jobs off-shored or been laid off early, too! :-) ]) (Note added July 20, 2010: It seems like corporations that have had their taxes cut have used the money to off-shore jobs and invest overseas, after getting some REALLY BAD ADVICE from academics at Harvard Business School, rather than invest in the American worker. I hope that the academics have expatriated by now….)

I recently spoke to a long-time friend in high-tech who is being laid off at age 49. (Note added October 21, 2010: Oh, she has a Ph.D. in a physical science and a software AND management background. Forget that nonsense about “get an education – get a job.”) When she spoke with a recruiter who had been successful in placing people of similar backgrounds, the recruiter mentioned HER AGE! 49! (Note added July 17, 2010: She is a registered Republican. I wonder if this experience will change her mind….)

At this point, most of us would ask ourselves, “Are business people stupid?” I would have to answer, “Only some….” :-) The San Jose article shows that seniors, not earning enough to survive and present in much larger numbers, are displacing teens in the workforce. This is only the “leading edge” of the baby boomers. The problem of unemployed seniors with inadequate savings will only grow worse! (MUCH WORSE, if they are laid off before retirement age…!)

So what has been the Business solution so far? Lay people off in their 50s when they are not yet eligible for Social Security and when they have a collection of skills that SHOULD be in high demand by Business! Or make the problem STILL WORSE – lay people off in their late 40s! :-)

I predict the very real possibility of a gray backlash by baby boomers who were laid off early and, instead of earning the kinds of salaries that would allow them to cover their own retirement costs, were forced to take any job available to cover costs until Social Security “kicks in” (and perhaps, even afterward). I predict resentment by the teens that they displace, and I predict resentment, by the seniors, of the Business environment that forced them into a situation of working at menial jobs in old age, in spite of their retirement planning. :-)

(The above discussion, of course, focuses ONLY on the “labor force.” The large group of baby boomer seniors that are getting laid off will not be able to be a market for the goods and services produced by Business – they will not have the income to do so!)

Baby boomers, by their numbers alone, can force changes through government. Also, baby boomers have never been “shy and retiring.” Having been “burned” by the businesses that they worked so hard to make successful, it is unlikely that boomers will “go quietly” to their graves. :-)

My advice to the businesses that will soon be “short-handed” is to learn about demographics and to plan and act accordingly. It is really your own survival that we are discussing here.

(Happy Bastille Day!)

-Bill at

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