Posts Tagged “employ older workers”

Mature employees want to keep working

More than half of mature workers—those age 50 and older—have a desire to keep working after they turn 65, but on their own terms.

That’s according to results from a joint study by Ceridian and CARP,Second Wind: The Evolving Nature of Retirement.

“Mature professionals are often overlooked based on assumptions that they are too old to keep up with the times and may cost a company more in terms of benefits,” says Ross Mayot, vice-president and general manager with CARP.

“Employers need to realize that the age of the worker does not define capability, negate the willingness to learn or adapt, or automatically mean increased benefits costs.”

To retain and recruit these productive and skilled workers, the study recommends that employers need to be prepared to address mature workers’ health concerns.

Adopting a progressive approach to workplace wellness contributes to a healthier aging population and can help make it easier for companies to extend health benefits beyond traditional retirement age—a desire of nearly half (48%) of the study’s respondents.

According to the study, the traditional nine-to-five, five-day workweek doesn’t appeal to many who are choosing to work beyond retirement age. Forty-six percent of respondents want non-traditional work arrangements such as flexible hours and job-sharing, and 41% would like phased-in retirement options.

Mature workers also want to protect their health with benefits that extend beyond the age of 65. The good news for employers is that the overwhelming majority of mature workers rate themselves to be in excellent or good health; just 4% report chronic health issues.

“This means, employers can invest in health and wellness programs now and reduce the substantial costs associated with prescription drugs and other healthcare services later,” states the report.

The vast majority of mature workers are looking for assistance with routine health maintenance measures, especially getting more exercise, better nutrition and weight loss.

Stress is a minor concern for mature workers and should allow “employers to divert some of their budget for any stress-related programming to more desired programs instead.”

Source: Benefits Canada

Jobless rate: salad days behind us as reality bites

ROD MYER Money Editor (acting)

The Australian economy is spluttering and there are worrying signs for 2015.

File photo of workers building cars at the Toyota plant in Melbourne — Mining and industry cuts have boosted the jobless rate. *Photo: AAP*

Australia dodged a bullet in the global financial crisis, but China’s appetite for coal and iron ore kept the recession wolf that stalked other countries from our door.

That’s all changed now as the latest rise in the jobless rate to 6.3 per cent from 6.2 per cent tells us. Joblessness now sits at a 12-year high.

The economy is still creating jobs, with 42,700 new ones emerging in November, but it needs to create tens of thousands more each month if employment is to stabilise.

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Bank of America-Merrill Lynch economist Saul Eslake told The New Daily that the jobless rate will peak at 6.75 per cent in a year as the economy bottoms and starts to improve.

The trouble is that all but 1800 of those were part-time jobs and the number of people who’d like more work is growing as a result.

You don’t have to look far to see signs of economic weakness.

The most recent GDP figure had the economy growing at only an annualised 2.2 per cent mid year, only two-thirds of the long-term trend.

And in the last week reports tell us consumer and business confidence are on the skids.

Ominously, the big department stores David Jones and Myer are reportedly planning to start their Boxing Day sales before Christmas, and not because Santa is coming early. It’s because shoppers are reluctant to reach for their wallets.

That will be worrying Joe Hockey, who urged consumers to get out and spend, but with people feeling uncertain about their jobs, a Christmas splurge is unlikely.

Up, up and … away?

Unemployment has been rising inexorably for the past 31 months and is now the highest it’s been in 12 years.

The worrying thing about that rise is, it’s the second longest stretch of rising unemployment in almost 60 years, with only the 38-month run-up to the peak of the early 1990s recession when unemployment hit double figures being longer.

For the past decade or more our national income has been driven by a rampaging resources industry that grew to account for about eight per cent of our economy when traditionally it was closer to two per cent.

The multi-billion dollar projects the boom underpinned are mostly built and that means a lot of those people in fluoro jackets earning six-figure salaries are losing their jobs and heading back south in reduced circumstances.

That’s taken a lot of cash out of the economy as will the current collapse of commodity prices driven by oversupply created by a lot of those new projects.

Another boom needed

So we are looking for a new economic champion but there is none stepping up to the plate.

Sure, housing construction is on the up but it isn’t close to taking over from mining construction at its heights.

And there’s lots of well-paying, secure jobs being lost in the car industry and areas like aluminium as Australia deindustrialises.

All that leaves us trapped in a pincer movement with unemployment.

There’s no recession but we are creating about 135,000 jobs a year while we need about 354,000 to hold the employment ship steady.

Australian Industry Group senior economist Julie Toth told The New Daily that there were early positive signs.

“Job ads are improving, but these will probably not translate into positive job growth within the next six to nine months,” Ms Toth said.

“We’re not expecting a strong improvement in employment growth over the next 12 to 18 months.”

Source: The New Daily

Take an encore: Reinventing your career

Social, economic and technological changes have all conspired to create what’s been labelled a ‘fluid workforce’, in which workers – young and old – need to be prepared to change jobs over the course of their careers.

Posted by Nigel Bowen on 5 December 2014

But how does someone who’s been working in the one field for 20 to 30 years reinvent themselves?

New tricks

Rosemary O’Connor, director of Encore Careers Australia, offers the following advice to those toying with the idea of starting afresh: “My top tip is to start planning your encore career as soon as possible. Think about what you would like to do next. What are your passions and interests? What skills and experience do you have? These are often transferrable to many different areas. Be realistic but think broadly – an encore career isn’t meant to be more of the same. Visualise your new career. What will it take to make it a satisfying reality? Above all, have a plan.”

Taking the necessary steps

If you’re serious about an encore career, here’s how you can get started.

Consider what you are good at and what interests you. Compile a list of industries to match. Do some research. To start, go onto job sites, explore some of the roles and companies in that area. This should help provide some insight into the array of roles available in those fields.
See if you can get in touch with industry associations or try speaking to people who actually work in the field to get a realistic picture of what is involved in the encore career you’re considering.
Look into related courses – whether it’s a short course or a formal qualification or certification. Find out if there are any prerequisites for the roles you are attracted to and see how you can go about addressing this. Consider volunteering your time or services for a company or business you admire to gain practical experience and make contacts.
Once you’ve laid the groundwork it’s time to start approaching employers, or launching a business and attempting to attract customers. Chances are you’ve acquired many transferrable skills, so make sure to highlight them on job applications or in your promotional material. Don’t let fear of ageism stop you highlighting your work and life experience – the wisdom and maturity you have gained is a valuable selling point.

Have you embarked on an encore career? How challenging did you find the transition?Please comment below or start a conversation over on the Living Well Navigator forums.

Helpful links What is an encore career? Ten tips for older job seekers Living Well Navigator – Job search

Helpful links

What is an encore career?
Ten tips for older job seekers
Living Well Navigator – Job search

How to keep your brain young and slow the process of ageing

RUTH OSTROW
DECEMBER 08, 2014

One revolutionary tip for longevity is the silly walk, a la John Cleese and Monty Python.Source: Supplied

WE dont have to age or at least grow old as fast as we do. Thats the finding of researchers in the US, where a group of specially trained lab rats equivalent in our years to 60-year-olds became as young and healthy as their 20-year-old companions.

Although our bodies will inevitably decline, scientific evidence presented at the recent international Mind & Its Potential Conference in Sydney suggests that the process can be slowed down by several decades. The things that really matter to us — vitality, libido, memory, and brain power — don’t have to change much into our 70s and 80s. And how can this be achieved? Not through hormones, surgery, vitamins or stem cell replacement.

It’s all about neurogenesis, or our ability to grow new synapses and neurons in our brains well into old age, according to University of California neuroscientist Michael Merzenich, who in Sydney shared advice on how to keep our brains young. “The King of Neuroplasticity”, Professor Merzenich, 72, says that when the brain is rejuvenated it also rejuvenates everything from our skin and organ function to capacity for pleasure and energy. The aim is to “fatten” the brain so the body doesn’t atrophy.

So how do we do this? Merzenich and other leading neuroscientists gave me their best tips for longevity. One of Merzenich’s revolutionary methods would have baby boomers and gen Xers laughing: the silly walk, a la John Cleese and Monty Python. Merzenich finds new and complicated ways to move every day to give his brain huge challenges. He says the brain loves to make decisions and solve problems, and it hates safe ways of doing things. To stay young, he says, don’t make things easy for the brain. Give it big surprises. Get out of the cave. Don’t say “I don’t do that.” Try it.

Exercise is fantastic for overall health, but to specifically grow the brain, the exercises can’t be predictable or routine. So add to the mix Rumba, Tango, gentle acrobatics, and yes, even a silly walk.

Merzenich was one of the stars of eminent psychiatrist and researcher Norman Doidge’s groundbreaking bestseller on neurogenesis and neuroplasticity, The Brain That Changes Itself. Doidge told me that “What fires together wires together”, and new synapses and pathways are forged constantly as long as the brain is used. With a bit of brain rewiring and practice, a pianist can become a concert pianist; a stroke victim can learn to talk and walk.

The bottom line, says Merzenich, is “use it or lose it”. He warns us to stop using a GPS and other gadgets for simple tasks. “Study road maps, and force yourself to remember where you’re going and the details around you. As primitive beings we survived by roaming the landscape. So listen and look around in a state of mindfulness.” Before sleep he spends five minutes in bed recalling the details he’s seen in the streets that day, in order to stimulate memory. He says to try and remember phone numbers and email addresses rather than using your mobile.

He advocates training the brain with games. Not a big fan of Sudoku or other problem-solving fads, Merzenich has a website of scientifically proven exercises. BrainHQ.com, from Posit Science, was featured in the ABC documentary Redesign My Brain, in which Todd Sampson volunteered himself as a lab rat to test the science of brain plasticity. Sampson turned into somewhat of a genius before our eyes.

Merzenich also praises meditation, which according to experiments by Richard J. Davidson of the University of Wisconsin-Madison, one of the world’s leading experts on the impact of contemplative practices on the brain, opens pathways in unused areas of the mind. Merzenich says we should learn languages, go back to university or do some courses — but to leave our comfort zone. He says try complex subjects you might not be good at, such as maths.

I followed his advice and three years ago went back to university. Despite being a technophobe, I chose to study technical matters such as video production, camera usage, and operating an edit suite. I was often in tears. But I did well, and noticed that my brain improved in other areas of memory and competency. The theory is that if you develop one part of the brain, synapses grow elsewhere.

New hobbies can challenge your brain with enough tension to create small squirts of cortisol and noradrenaline. Unlike dangerous chronic stress that comes from worry, small hits of stress hormones are excellent for stimulating the mind. Perhaps birdwatch and learn the name of new species. Stay curious. Travel is great. After achieving a new skill, reward yourself. Self-praise clinches the lessons and rewires the brain. Positive feedback promotes good habits.

US psychiatrist Stuart Brown was recently in Australia talking about the importance of play in brain health. Activities such as volleyball, running into the sea and ballroom dancing have been shown to trigger parts of the brain associated with social connection and increased intelligence.

Brown first recognised the importance of play by discovering its absence in the life stories of murderers and sociopaths. His research led him to prove that when we play and laugh, we release not only dopamine, oxytocins and other reward neurochemicals but also create synaptic connections.

Social interaction is crucial for wellbeing, according to the “father of social neuroscience”, UCLA professor Matthew Lieberman. He says without love, relationships and community, the deterioration of our health is equivalent to smoking two packets of cigarettes a day. Being with people helps us read facial signs, develop empathy and exercise our prefrontal cortex, which governs higher order functions. It was, and still is, crucial to our survival as a species. So turn off Facebook and go face-to-face.

Neuroscientists have proven that juggling increases thinking speed and one’s ability to focus. Michael J. Gelb, a respected creative thinker from the US, says that while juggling we increase our metacognition — the capacity to think about our thinking processes. This improves motor skills, spatial awareness and problem-solving capacity.

Most of us feel awkward trying new things, which is why we mostly don’t. Tal Ben Shahar, a prominent US expert in positive psychology, says we need to reframe our failures so we see them as “lessons”.

He believes we should not let fear make us shun new things. Developing comes from accepting our failures with grace. “Babies don’t just walk. They need to keep falling down, then they walk,” he reassures those of us who are embarking on a journey towards our full adult potential.

How to jump-start the grey matter

• Find new ways to move or walk every day

• Don’t stay in your comfort zone. Give the brain surprises, decisions and problems to solve

• What fires together wires together. Talent is not important. Practice any skill for 10,000 hours and you’ll master it.

• Stop using a GPS and contact book: memorise maps, phone numbers and email addresses

• Do online exercises such as BrainHQ.com from Posit Science

• Meditate for at least 20 minutes at a time, preferably morning and night

• Study something you are not good at; take up hobbies

• Read, read and read

• Play and increase your social contact

• Before going to sleep, for five minutes recall details of something like the house next door or a friend’s face

• Juggle to increase motor skills and spatial awareness

ruthostrow.com; Twitter: @OstrowRuth

Source: THE AUSTRALIAN

Everydayonomics: The despair of being over 60 and jobless

Date: December 7, 2014

Matt Wade

Stuck “on a human hamster wheel”: Older unemployed people are likely to remain unemployed much longer than younger people. Photo: Greg Newington

One of the most confronting interviews I have done this year was with Glenda Ellwood-White, a 60-year-old who has been out of work for more than five years.

She lives with her 23-year-old son in a granny flat in Sydney’s inner west. Her income is so low she often cannot afford meals and when she does eat, the menu is monotonous.

“I often think my stomach will kill me if I have any more noodles,” so I often just have a piece of toast and a cup of tea,” Ellwood-White told me.

She likens life on the Newstart benefit to being stuck “on a human hamster wheel”.

We do not hear that much about the struggles of older unemployed people such as Ellwood-White, but it turns out they are likely to remain unemployed much longer than younger people.

Analysis by Marcia Keegan, an economist with consultancy SGS Economics and Planning, shows that a quarter of those aged 45 to 64 remained unemployed for more than a year compared with only 15 per cent of people aged under 44.

“If you become unemployed at an older age, your chances of finding a job are a lot lower than someone who becomes unemployed at a younger age,” she said.

The problem is most acute for those aged over 60 – two-thirds of Newstart recipients in that age group have been out of work for more than 12 months.

So why are older workers so much more likely to be unemployed long term?

Prejudice is a major factor. The Australian Human Rights Commission says discrimination can be found among the job applicants as young as their mid-40s. A recent job search experience survey found almost one in five people aged 45 to 64 felt their age was the main difficulty they faced in finding work. Ellwood-White claims her long search for a job proves age-based prejudice is “rife”.

Another explanation is that employers fear a short period of service from older workers.

“If an employer interviews someone in their late 50s or early 60s, they might think the person is going to retire in a few years or take their superannuation tax-free,” Dr Keegan said. “They think they might be able to keep a younger worker for longer, but this is very unfair, because workers in their late 50s or early 60s often want to work for another 10 years or more.”

But older workers can sometimes be demanding. When Keegan explored what wages unemployed people wanted, she found older people, especially men, tended to have higher expectations than younger workers. This might encourage employers to go for younger workers, especially if they have been out of work for a long period.

Disability is another factor. More than 30 per cent of workers aged 60 to 64 have some sort of disability that limits job options. In contrast, the rate of disability among those aged 15 to 24 is only about 8 per cent. The good news is that the proportion of older workers with a disability is falling – among 60 to 64-year-olds, the rate dropped from close to 40 per cent in 2003 to about 33 per cent in 2012.

This year’s federal budget introduced a new policy to reduce mature-age unemployment called Restart. Employers will receive $10,000 over two years when they employ a person aged over 50 on income support for at least six months.

Even so, older workers are a significant part of a growing longer-term unemployment problem in Australia. This year, the rate of long-term unemployment has climbed to 1.2 per cent of the labour force – well above the decade-long average of 0.92 per cent. The Fairfax-Lateral Economics Wellbeing Index – which puts a dollar figure on national welfare – shows the well-being cost of long-term unemployment has surged in the past year and is now a $2 billion-a-year drag on the nation’s collective well-being. Much of the pain is being felt by those aged in their 50s, 60s and 70s.

Source: SMH

Why older workers are better employees in 2015

9:36pm, Dec 1, 2014
EMILY CHANTIRI

A new study reveals older workers can be the most valuable to their workplace. Here’s why.

baby boomer workers — Baby boomers are the least likely to be distracted by technology. *Photo: Shutterstock*

The future for employing older workers is looking good, and there is plenty of evidence to back this up.

A study by Clarius Recruitment group has favoured older workers in terms of their value to employers. Of the 1000 white collar professionals interviewed for the study, older workers reported they were productive for at least 80 per cent of the day.

Gen X reported productivity at 60 per cent, with Gen Y believing they were only productive for just 42 per cent of the day.

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The report found that when it comes to social media baby boomers are the least likely to get distracted with 69 per cent of boomers stating they were not distracted by media such as Facebook, which is by far the biggest distracter of the platforms according to professionals.

Fifty-seven per cent of Gen Xs were able to ignore it, however only 23 per cent of Gen Ys said social media did not distract them.

Clarius CEO Peter Wilson said the research shows that older people are less distracted by technology such as surfing the net or social media.

“We have also found that older people tend to be more contented in their job which makes them less likely to seek diversions,” Mr Wilson said.

“While the younger generation is clearly the masters of technology, the older workers are experienced and can problem solve so need less supervision or guidance.”

The report found younger workers said they were much more likely to feel they are bullied which distracts them from their work.

“Older generations tend to have more life experience in working and personal environments, they’ve been there and done that, and have generally developed resilience. They tend not to want to get bogged down in the office politics, rather focus on the task at hand and doing a good job,” he said.

Tech savvy generations

While no one can argue the benefits of having greater experience, some boomers have lower technical ability compared with younger workers.

Another study by recruitment firm Hudson, The Generational Shift report, analysed the leadership traits of 28,000 professionals globally and found, that aside from some boomers having lower technical ability, those nearing the end of their career could also be seen as less ambitious.

Although baby boomers were not born with an iPad as a play pal, they are the generation that had to teach themselves technology so they are attuned to continual learning.

“There are companies who embrace the diversity and other benefits older people bring to their work force, however, many companies still discriminate against them. The reality is we have an ageing population and while Australian business grapples with the gender pay gap, the burgeoning challenge is changing our attitudes towards older workers,” Clarius CEO Mr Wilson said.

The issue of age

Jane McNeil, Director at Hays Recruitment, agreed saying age discrimination was one of the biggest issues on the employment landscape but few employers wanted to admit to it.

While many employers valued older workers, others still needed to address their recruitment and selection processes to eliminate bias; whether that is conscious or unconscious.

The upside, she added, is that over the past 10 years or so more employers are recruiting older workers.

In recent years the importance of this contribution has grown. In fact, older workers have absorbed half of Australia’s net growth in jobs since the global financial crisis, possibly because economically people now need to work longer.

“We’re now seeing more age-friendly employers, and more men and women working on into their late sixties,” Ms McNeil said.

“This shows they are valued by many employers, who often see them as reliable with high level of motivation and a balanced routine. They can also help fill any knowledge or skill gaps in a workplace since they have a wealth of experience. Another benefit of an older employer is that they can mentor less experienced ones.”

Source: The New Daily

Recruiters need to educate businesses in benefits of older workers

Thu, 27 Nov 2014

Increasing numbers of older workers make it even more important for recruiters to convince their clients of the benefits of employing them.

This was the message from panellists discussing diversity issues at an event, hosted by the Recruitment & Employment Confederation (REC), at Global Recruiter’s conference in London this week.

Sarah Gordon, associate director of Sammons Group and chair of REC’s diversity and inclusion forum, said when it comes to increasing diversity, including the employment of older workers, recruiters can add “a huge amount of value” because they have to take the time to get to know candidates, which are then recommended to clients after they been through an “objective” recruitment process.

She said: “There is a lot of unconscious bias out there so it is having that awareness and putting coping mechanisms in place to do our best to eliminate it as an industry. There is an appetite out there from clients. Obviously, there are some clients who are not aware they are discriminating. It is our role to educate as well.”

Catherine Finney, who is part of the fuller working lives team at the Department for Work and Pensions (DWP), pointed out that by 2020 a third of the UK workforce would be over 50. While older workers are less likely to be made redundant, if they do lose their job they are more likely to become long-term unemployed, explained Finney.

“There seems to be a barrier when it comes to getting [older] people back into work,” she said, “which seems counter intuitive when they have got all this experience and all these skills.”

An audience member pointed out that it could be difficult for recruiters to put older candidates forward in the construction sector because they were more expensive and clients wanted workers to “grow” with the company.

Gordon acknowledged that attitudes to older workers do vary from sector to sector.

Recruiters, she said, should give clients a “reality check” on how the modern workforce works and that jobs for life no longer exist.

Finney added: “I’m not saying older workers shouldn’t want career advancement but they are not necessarily in that same phase of their careers as a younger worker.”

Robert Livingston, a professor in organisational behaviour and director for the Centre for Leadership, Ethics and Diversity, said older workers are an important part of a diverse workforce and have a lot to contribute in terms of team dynamics.

Older workers, said Livingstone, can also draw out positive behaviours in younger workers and achieve return on investment for the employer because of their reliability and loyalty.

– See more at: http://www.recruiter.co.uk/news/2014/11/recruiters-need-to-educate-businesses-in-benefits-of-older-workers/#sthash.NF3fy38M.dpuf

Hard times loom for too many boomers

Date: November 26, 2014

John Collett

Baby boomers caught short on retirement

The last of the baby boomers will turn 50 by the end of the this year. Often it is the big five-o that starts people to really think about saving for their retirement.

So with all of those born in the two decades to 1964 now either retired, or galloping toward it, there are bound to be changes to the economy and society in general.

Boomers have changed each life stage they have passed, and older boomers are redefining what it means to retire.

Retire in peace: for many baby boomers retirement may not be as comfortable as they would like.

They want to be able to enjoy the lifestyle to which many have become accustomed during their working lives.

However, there are challenges. While many have benefited from rising house prices, for many others, the size of their superannuation accounts is not big enough to afford the retirements they would like.

More boomers are entering retirement with debt and their adult children are staying at home for longer, which is making it harder to save.

Looking to the future: About 35 per cent of baby boomers describe themselves as “completely unprepared” for retirement.

Not enough saved

A survey on behalf of industry super fund REST, released early last year, found a disconnect between what boomers expect their retirement to be like and what reality has in store.

It found 35 per cent of boomers described themselves are “completely unprepared” for retirement, 51 per cent as “somewhat prepared” and only 14 per cent as financially prepared.

Universal compulsory super only started in 1992, so boomers, older ones in particular, have not had the benefit of the superannuation guarantee over their whole working lives.

In a second REST survey of over-50s, released in June this year, one quarter said they had less than $50,000 in super, with a further 12 per cent having $50,000 to $100,000 in super.

Not surprisingly, only half of over 50s say they are looking forward to retirement. It seems it is more likely to be outings in the tinnie rather than cruising down the Rhine or Loire.

“This group who started their working lives before the advent of compulsory superannuation are trapped between a rock and a hard place,” says Damian Hill, the chief executive of REST.

Nearly two-thirds estimate they will need to rely on the age pension to supplement their retirement income, highlighting the fact that the system came too late for some to get the maximum impact,” he said.

Wait for age pension

However, younger boomers are going to be waiting longer for the age pension and the pensioner concessions that come with it.

The Abbott government is to further increase the qualifying age for the age pension to 70 by July 1, 2035. The increase will be phased-in.

The higher qualifying age will affect younger boomers more than is likely realised. The exact qualifying age will depend on actual birth date but, very roughly, anyone aged about 49 or younger now will have a qualifying age of 70.

The youngest boomers (those aged about 50) will be waiting until they are 69 for the age pension. For those aged 55, it is 67 and for today’s 60-year-old it is 66.

It is not just a longer wait for the pension, but starting in 2017 a couple of measures will tighten access to the pension and the fortnightly pension will be indexed to inflation, rather than to wages, which grows more quickly than inflation.

As well, it is only a matter of time before the preservation age, the age at which superannuation savings can be accessed, is increased. Like the increase in the age pension qualifying age it would be increased gradually, but could rise to age 65 to maintain the five-year gap with the new age pension qualifying age.

Call to action

Olivia Maragna, a financial planner with Aspire Retire, rarely sees boomers who cannot make relatively small changes in their weekly budgeting that will put them in a position to have the lifestyle they want in retirement.

A good adviser should be looking line-by-line on spending and giving advice on how they can make little changes on all aspects of their financial affairs, she says.

Sometimes, boomers have to be told that they are not going to have the retirement they want if they do not makes changes now.

Claire Mackay, a financial planner and a chartered accountant at Quantum Financial, says: “You cannot have a champagne lifestyle on a beer budget.” She says: “If you do not have discipline around expenses while you have regular pay coming in, it is going to be that much harder in retirement.”

Mackay says usually the first things new clients will ask her is how much money they will need for their retirement, and whether they are on track to get there.

Mackay does modelling for the client that shows the outcome if the client keeps doing what they are doing. The modelling shows how, by making some small changes, such as spending a bit less, they will be able to live better in retirement.

Though, for many boomers, even making small savings, such as salary sacrificing into super, can be difficult as many of them are sandwiched between looking after their ageing parents and their adult children.

Sandwich generation

Laura Menschik, a financial planner and director of WLM Financial Services, has many boomer clients who are sandwiched between caring for aging parents and their adult children.

Many of the younger boomers still have sizeable mortgages. More of their adult children are going onto full-time tertiary eduction and staying at home for longer.

High rents and high house prices, especially in Sydney and Melbourne, are also keeping adult children at home for longer. Menschik says she is coming across more boomers who say they want to help their children into the property market.

She says, some of her clients who do not have the cash to help their children with a house deposit do look to access part of their super if they can.

“I am not saying it is for everyone, but it is a trend for those baby boomers who have done well out of property themselves,” Menschik says.

The parents have to be able to afford it, Menschik says. You do not want to be going back to the children some years later and saying you need to money back, she says.

Though there are challenges, retirement is exciting, Mackay says. It is the time you can do what you want to do. “I have had clients come to me months before they retire; it is never too late to start,” she says. “If you have a plan you then you can make adjustments.”

Home to fund retirement

Many boomers will have seen the value of their homes rise considerably, and that is likely to prompt them to think that the house could be the answer to the retirement-saving shortfall.

According to the latest MLC Wealth Sentiment survey, released in October, 11 per cent of adult Australians plan to sell the family home to fund their retirement.

About 8 per cent said they would draw down equity in their home to help fund their retirements. The others were either unsure what they would do or said they had no plans to sell their homes.

Menschik says people who sell the family home and then buy the apartment on the coast often find they do not have much left over.

“They want the nice apartment with the view and there is not much left over, especially after the high costs of moving,” she says. These include high transaction costs such as stamp duty.

They will probably want at least a couple of bedrooms to accommodate visitors. Older boomers looking for a quick fix may be tempted by a reverse mortgage, which is a way for home-owning retirees to free some cash while staying in the house. They are usually available to over-60s who own their home outright.

The money can be taken as a lump sum or as an income stream. Menschik says reverse mortgages can be suitable. There are no repayments on the loan, which is repaid when house is sold. That will be when the owner dies, moves to a smaller house, or moves into a retirement home or an aged-care facility. As there are no repayments on the loan the interest on the loan is capitalised.

They have to understand the debt can grow to be a large of chunk of the sale price of the price of the house, especially over long periods, Menschik says. That will leave less for the owner to fund aged care after the house is sold or to pay for medical expenses.

An alternative to reverse mortgages is run by the government and is cheaper than a reverse mortgage from a bank. Centrelink and Department of Veterans’ Affairs have a Pension Loan Scheme where those on a part age pension can take out a loan that is repaid when the property, which can be an investment property, is sold.

The loan can only be taken as an income stream. It is limited to that which, when added to the part-pension, takes them to the maximum pension. There are conditions, but the scheme is available to some retirees of age-pension age who are not receiving the age pension.

Bucket list

An online poll was conducted early this year of 1000 people aged 55 plus on behalf of REST super fund. Over half of older Australians said they have a retirement bucket list. Of those with a bucket list:

More than half (53 per cent) want to travel the world.
Four in 10 (43 per cent) want to go on a road trip.
One third (36 per cent) want to visit a world famous attraction or event like Machu Picchu, Niagara Falls or the Rio carnival.
One in seven (14 per cent) want to swim with dolphins.
15 per cent want to write a book.
One in 10 (11 per cent) want to learn to play a musical instrument.
30 per cent want to leave an inheritance to their children.

Action plan

Thirty-seven per cent of over-50s say they have less than $100,000 in super.
It is never too late to start a plan for retirement.
Professional advice can help clarify what is needed.
The earlier a retirement strategy is started the better.
Releasing equity in the house to help fund retirement has to be approached with caution.

Source: SMH

Working in retirement to become a way of life

Ageing workforce…Many couples are unable to retire and will have to keep working service industry jobs. Picture: Supplied Source: Supplied

TWO-THIRDS of Australians expect to keep working well beyond the official retirement age, but many are worried that their ageing bodies won’t let them.

A new study has found that 40 per cent of people hope to work “as long as possible” and another 27 per cent say they will be forced to work into their old age because they will need the money.

However, more than one-quarter believe they will struggle to do their jobs by age 70, says the Galaxy report commissioned by workforce management solutions company Kronos.

Ageing workforce…A new study has revealed that 27 per cent of people say they will be forced to work into their old age because they will need the money. Picture: Supplied. Source: Supplied

And an increasing generation gap in the workplace threatens to drive them out, with tensions stemming from younger workers being unwilling to accept advice from their older colleagues.

“Employers who ignore changes in workplace demographics may find themselves confronting increased office disharmony,” the CEO of Kronos Australia and New Zealand, Peter Harte, said.

He said the trend of working past age 65 would continue to grow because many people wanted to be more active as they aged and others “have no choice but to work for as long as possible”.

Australia’s pension age of 65 is set to rise incrementally to 67 by 2023, then 70 by 2035. The upward shifts start in 2017, moving to 65.5 years.

New trend…Peter Harte, CEO of Kronos Australia and New Zealand said some people retire later to keep active while others have no choice. Picture: Supplied. Source: Supplied

Social research group McCrindle says Australia has 3.45 million people aged over 65, and this is forecast to grow to 4.76 million in 10 years and 7.75 million in 30 years.

McCrindle director of research Claire Madden said people were tempted to stay working for longer by a desire to remain active, scars from the global financial crisis, cost of living pressures, increased lifestyle expectations and even new expense categories such as smartphones and tablet computers.

“The concept of retirement is being redefined by today’s generation of Baby Boomers,” she said.

“They are wanting to remain active contributors and find work is a fulfilling way of doing it.”

Source: News Corp Australia Network

Australia facing a brain drain as baby boomers retire, youth unemployment remains high: AMP.NATSEM Report

16 November 2014

Australia is facing a brain drain as a massive wave of skills and experience exit the workforce with
retiring baby boomers, while youth unemployment is 4.5 times higher than the rest of the working
age population, according to the latest AMP.NATSEM Income and Wealth report.

AMP.NATSEM: We can work it out – Australia’s Changing Workforce looks at how Australia’s
workforce has changed over time, unemployment across Australia and compared to other countries,
incomes and gender structure of the workforce.
With the baby boomer generation moving into retirement the proportion of older people, those aged
65 and over, will rise to nearly a quarter of the population, from 13.5% to 22.7% in 2050, taking
valuable skills, knowledge and experience from the workforce.
At the same time, the youth unemployment rate, those aged 15 to 19 looking for full time work, is
4.5 times more than it is for those aged 20 and over, at 27.2% compared to 6.2%.
AMP Chief Customer Officer Paul Sainsbury said the AMP.NATSEM report showed the challenges
of Australia’s workforce was two-fold.
“People over 65 are projected to make up nearly a quarter of the population in the future.
“As older people leave the workforce they will take with them skills and experience, while many
young people are struggling to find work. As a consequence, it might mean that younger people are
not getting the experience they need to do these jobs in the future.
“The report highlights the challenges of an ageing population.
“With lower birth rates and much longer life expectancy, it is critically important for people to
adequately plan for their future so they not only enjoy a comfortable retirement, but also Australia
remains prosperous as the workforce composition changes,” Mr Sainsbury said.
The report also finds the representation of women in the workforce has shifted significantly. These
days women are the majority in four out of eight occupation groups measured by the Australian
Census, compared to only two in 1991 and one in 1911.
Key findings: Australia facing a brain drain as baby boomers retire… 2
Challenges of an ageing population
The baby boomer generation is moving into retirement, with the proportion of older people, those
aged 65 and over, expected to rise to nearly a quarter of the population by 2050, jumping from
13.5% in 2010 to 22.7% in 2050. This will see a significant depth of skills, knowledge and
experience move out of the workforce.
Australia’s fertility rate below replacement level
Australia’s fertility rate is below replacement level, meaning the proportion of working age people is
forecast to drop to 60% by 2050, down from 67.4% in 2010.
Youth unemployment
The youth unemployment rate, those aged 15 to 19 who are looking for full time work, is 4.5 times
more than it is for those aged 20 and over. More than 75% of young people work part time, more
than double those aged 20 and over.
International employment comparisons
Australia is in the top 10, at 6%, when it comes to low unemployment. This is significantly lower than
many other countries, particularly parts of southern Europe where unemployment rates above 10%
are common, including Spain (24.5%) and Greece (27.3%), meaning a quarter of their workforce is
unemployed.
Increasing female participation in part time work
Part time employment is increasingly important with around 30.7% employed part time. The large
increase in female participation is a key driver of part time employment with female participation
increasing from 52% to 61% between 1991 and 2011.
Significant structural change
Australian occupations have changed significantly over the past 100 years. Primary producers, such
as farmers, accounted for the highest proportion of the workforce in 1911 at 30%, while today they
make up just 1.3% of the workforce. By contrast, in 1911 only 7% of workers were classed as
professionals, whereas today they make up nearly a quarter of the workforce (22%).
Incomes across industry
Workers in mining have the highest salaries, with a median income of $2134 per week. This
compares to workers in agriculture, forestry and fishing who earn $761 per week, and reflects the
change in demand for occupations such as farming and fishing.
Incomes by occupation
Looking at incomes by occupation, professionals top the list with a median income of $1546 per
week, with labourers having the lowest weekly median income at $892 per week.
State by state
Across Australia, Tasmania has the highest unemployment rate at 7.1%, compared to the national
average of 6%. NSW has the highest income earners in the country, in the Sydney suburbs of
Darling Point, Edgecliff and Point Piper, while Western Australia is home to the second highest
income earners, in the Perth suburbs Cottesloe and Peppermint Grove.
Professor Robert Tanton, of NATSEM, said: “The report shows significant change over the years
resulting in a very uncertain workforce.
“Young people are facing difficulties gaining employment due to changes in technology, tougher
economic conditions and increasing requirements for qualifications, while older people are retiring
and taking skills, experience and knowledge with them,” Mr Tanton said. Australia facing a brain drain as baby boomers retire… 3
Since 2002, AMP and NATSEM have produced a series of reports that open windows on Australian
society, the way we live and work – and our financial and personal aspirations.
AMP publishes these reports to help the community make informed financial and lifestyle decisions
and to contribute to important social and economic policy debate.
Download a full copy of the report at: www.amp.com.au/media