Work Till You Drop: A Sincere Revaluation of Retirement in America

It may be time to reevaluate retirement in the US.

The Associated Press' John Rogers had an interesting article Monday on the prospect of retirement for baby boomers. Rogers discussed the plight of baby boomers struggling to make their way in dire and precarious economic times. In light of diminishing nest eggs for retirement, companies' eliminating benefit pensions, and a sour labor market, Rogers' analysis portends that the paradigm of work and retirement for aging Americans is shifting to a point where there is no retirement, where individuals will work until they pass on from this life.

According to Rogers' article, Ed Lawler of the University of Southern California's Marshall School of Business stated, "People who would have normally been out of the workforce are still there, taking jobs that would have gone to what we now call the unemployed." From the article: "With unions no longer in a strong position to fight for benefits like pensions, with jobs disappearing or going overseas, and with Gen Xers and even younger Millennial Generation members coveting their jobs, Lawler warns this is no time for boomers to quit and allow the skills they've spent a lifetime building to atrophy."

Rogers' analysis suggests that many baby boomers may find themselves being "part of that new generation that never stops working." In light of shifting sectors of the economy owing to technology, globalization, the labor market, and other factors, "[f]or boomers, it's a new era of 'work til you drop'." Though only lingering in the background, the crux of this situation goes back to uncertainty in the market. And even then, as we find ourselves in precarious economic and political conditions, global and generational factors seem to be compounding the socio-economic uncertainty.

In September 2011, I discussed issues related to younger generations and the prospect of retirement. Regarding that topic, I wrote, "The elephant in the room with respect to this discussion goes back to the baby boomer generation." Further, "if many Gen-X and Gen-Y Americans find themselves unemployed (and unemployable) going into the future, unable to buy homes, get married, or have children, how will the younger generations be able to take care of the elderly generation of the future?" In light of the idea that young people may not save enough for retirement, the situation appears to be at risk of convulsing in the future in taking into consideration problems with Social Security, long-term unemployment, an aging population, and generational resentment. And that's not even getting into rising food and fuel costs.

Whereas consumers' being squeezed and bad memories of 401(k) nest eggs losing value in 2008 may draw some away from putting hope for retirement into the stock market, it would appear that problems with the prospect of retirement in the US are connected with an underlying crisis of investment. Of course, hindsight is 20/20, but as hard as it may be to believe, if one had invested $50,000 in gold back in January 2000, that same amount would be worth over $300,000 today. Even aside from gold, if one can conceptualize labor as being a form of investment, I think the overhanging shadow with respect to retirement in the US does go back to this underlying crisis of investment, spurred from societal uncertainty with respect to finances and life in general.

In January 2012, MarketWatch's Robert Powell wrote an interesting story on how retirement in the US is "endangered". Powell: "Things are bad and, in the absence of action or in the presence of ill-advised action, could get much worse." Powell contended that in light of Social Security, 401(k) contribution rates, and declining employer-sponsored retirement plans, "America is facing an unprecedented retirement challenge." From the article: "[M]any Americans are still significantly short of the savings they will need for a dignified retirement and are unprepared for the complex financial choices they will need to make." Even so, I do believe that there is hope for retirement in America. I can think of some groups of elderly Americans (who may not be considered particularly wealthy) that are probably not too concerned about the future of Social Security or the stock market, e.g., the Amish; those elderly Americans are probably not up at night thinking about retirement.

The "good" news (if you want to call it that) is that for many young Americans, retirement is something that remains far down the road. Even then though, how can one retire if one never had the opportunity to work in the first place? The whole point of retirement is that you work...and then you retire. It's quite comical to even consider the question of young people saving for retirement when many young people are unemployed or underemployed. Such discussion seems to reflect a serious generational disconnect (promulgated by the American media) in terms of labor, wealth, and lifestyles. And even if retirement remains far down the road for younger Americans, in light of an increasing number of baby boomers approaching age 65, societal problems related to retirement appear much nearer on the timeline. In a society where the economy is "every man for himself", the fact of the matter is that even if retirement in the US is facing a paradigm shift, the rest of the economy and greater society are facing imminent paradigm shifts as well. One might say that our entire socio-economic superstructure appears to be facing a paradigm shift.

Our current predicament portends that, for both the wealthy and the poor, our contemporary societal conceptions of everyday life from food to housing to transportation may have to change owing to market forces. The labor market, food prices, gas prices, take your pick. At the end of the day, I can't say that the market will ensure that everything will work out in the end...but I can say that nature has ways of working things out. I think in terms of societal realities, there's only so long that older Americans can work-till-they-drop until the market effectively forces societal change in terms of labor and retirement. From this perspective, if we find ourselves in a situation where older Americans are able to work at the expense of younger Americans that never even had a chance to have a fulfilling career and productive lives working, most likely social unrest and societal demand for change will mandate that the labor market radically evolves...and in a very short period of time. Alternatively, such a society could evolve to the point where the older members of the society work to support the younger unemployed or underemployed members of society via taxes and familial support, but even then, one wonders how long such a labor regime would last.

Given the precarious state of the economy, it's difficult to say one way or another how the American retirement situation will evolve, but far from gold, oil, or real estate, I do think a return to an investment in human capital may be a viable path to a stable notion of retirement in the US. It is important to note that retirement in itself serves a functional purpose in that many elderly individuals simply cannot work. I'm not sure if such a societal paradigm shift signals a move more towards familial communal living where three or four families live in one household, but this sort of idea may prove to be a viable economic solution to the issue of retirement. Dare I say it, I think societal investment in a bit more humanism and a sense of cohesive community consciousness in the US as a nation could go a long way -- akin to a nationwide investment in gold. Maybe part of the problem with retirement in the US is that we live in a society where all-too-often pieces of paper and digitized numbers on a screen are considered higher in value than human potential; I'm sure many pet animals across the nation eat better & more regular meals and have better quality health care than some impoverished American families. Maybe it's just me, but perhaps that's part of the problem.

With such wide disparities in wealth and lifestyles, is it any surprise then that retirement in the US is "endangered" and that some may find themselves effectively forced to work till they drop? Obviously, the marketplace has realistic downsides, but the marketplace is how commerce flows and how society functions peacefully in order to grow, flourish, and survive. Nevertheless, perhaps if steps were undertaken to restore a sense of wealth in human potential as a society, socio-economic wealth would follow thereby restoring a sense of stability to the idea of retirement in America.

In the end, the crux regarding retirement in America is uncertainty; prices are going up and things are changing so fast that we can't imagine ten years down the road, let alone 30 or 40 years down the road. I think once the specter of economic uncertainty subsides, as a society we can regain a footing as to a viable socio-economic course for retirement -- thereby beginning a substantive debate on American society and the elderly -- thereby working our way towards a sincere revaluation of retirement.