Almost half of U.S. employers say they’re looking forward to their boomer workers’ extended careers as older employees continue working past age 65, a report released Tuesday by BMO Retirement Services found.
Some of those benefits include a work force with demonstrated value and accumulated knowledge, especially when it comes to a particular knowledge set, Todd Perala (left), director of relationship management for BMO, told AdvisorOne on Thursday.
Just 4% of employers said their employees’ longer careers would have a negative effect on the company, compared with 45% who said their company would benefit.
“Employers might prevent the opportunity to grow talent among younger workers,” Perala said. “There’s also the potential that, if a significant percentage of the work force is older, they may have more of a tendency to use medical benefits.”
The majority of surveyed employers expect at least 30% of boomers will continue working past retirement age. Almost one-quarter of respondents expect more than half of boomers to do so. A June survey of 2,000 people between ages 23 and 82 by TD Ameritrade found 80% of workers expect to continue working in retirement, and a quarter of retirees returned to work.
“Although some companies will continue to offer buyouts and retirement packages to their older staff, our survey suggests that many businesses will be pleased to retain selected boomer employees,” Perala said in a statement. “There appears to be a growing recognition in corporate America that employees in their 60s possess valuable institutional experience and expertise.”
The study didn’t ask respondents what steps, if any, their employers were taking to retain older workers, but Perala noted that he has seen employers proactively working to keep workers who are about to retire. He noted an employee in his own company who was able to retire and highly stressed in his position. To keep the worker in the company, his position was reduced to three days a week.
That kind of arrangement will be different for everyone, Perala said, but in his case, the worker was able to begin a mentoring process to help younger employees develop relationships with their customers.
“This is likely a prolonged period of phased retirements, where employees are thinking about retirement while not fully retired,” Perala said. “One thing we haven’t addressed as an industry is,’What happens if you have an extended transition from working to not working?”
BMO surveyed 412 retirement plan sponsors on its recordkeeping platform that have at least $2 million in trust assets.