The New Old Age

The New Old Age
We're living longer and staying healthier. Maybe it's time to rethink mandatory retirement.

BY KEN MACQUEEN
From Maclean's

Professor Gloria Gutman has the kind of credentials that should guarantee a long, fruitful stay at the peak of her profession. She developed and directs the highly regarded Gerontology Research Centre at Simon Fraser University in Vancouver. She's written or edited 20 books and more than 100 scholarly articles on such issues as housing for the elderly, dementia and long-term care. Her work is recognized beyond Canada's borders -- she's president of the International Association of Gerontology, representing organizations in 63 countries.

But last summer she faced a problem. On July 17 she turned 65. At Simon Fraser, as at many institutions and workplaces across Canada, that's the age of mandatory retirement. Happy birthday! Here's your watch, there's the door. One day you're 64, an internationally respected member of the faculty. The next, you're too old to be employed as an expert on aging.

How weird!

"I find it odious," Gutman says. "At whatever age we are, we should be judged on the basis of our competency."

In her view, Canada is tossing away a valuable part of its labour force. "It's insane when you figure what life expectancy is today," she says. "And look at demographics -- fertility rates are dropping. We need everybody to work who can work."

Increasingly, opinion leaders share that view. Mandatory retirement, once a hallmark of a prosperous and civilized society, now seems doomed by demographics. With too many old people and too few young, something's got to give. Even Canada's 66-year-old Prime Minister wants an end to mandatory retirement. It's a notion, however, that sends chills down the aching backs of some labourers bent over factory assembly lines, or office workers trapped in cubicleland, counting the months until their pension kicks in.

Others see lingering longer in the workforce as an economic imperative. Forced retirement and early buyouts make no sense for employers in the face of a looming labour shortage. And as for workers, recent polls show mounting public doubts that their government or company pensions will be there when they retire. For that matter, as life expectancy stretches into the 80s, maybe 60 or 65 is too young to collect a full pension. The United States and several cash-strapped European countries now think so.

For some critics, forced retirement is simply unfair: Why is age the last bastion of socially accepted discrimination? "Nobody has a shelf life," declares the Ontario Human Rights Commission, which set the agenda in that province with a 2001 report calling for an amendment to the rights code to make mandatory retirement illegal.

Chief Commissioner Keith Norton says society has changed since 1990, when the Supreme Court of Canada upheld mandatory retirement as a justifiable limit on constitutional rights. Among the arguments considered by the judges -- themselves with a mandatory retirement age of 75 -- was that older workers blocked the young from the workforce. Most economists dismiss that as invalid, saying the economy creates as many jobs as there are workers to fill them, as it did when women entered the workforce.

In any case, young people will soon be in short supply as the population ages. Ontario alone will have 2-1/2 million people 65 or older by 2021, two thirds more than in 1998. Careers and families are starting later in life, why not an older age for retirement? Norton, 64, is adamant the public wants "the dignity of planning their own retirement according to their needs and resources."

Organized labour is not inclined to agree. Many union leaders see the issue as an assault on hard-won collective agreements and pensions -- an attempt to roll back progress to the worst days of the Industrial Revolution, an era in which you retired when your heart stopped beating.

Wayne Samuelson, 53, president of the Ontario Federation of Labour and a former worker at a Kitchener tire plant, remembers rubber workers striking and winning the right to retire after 30 years. He doesn't want such advances eroded. The dubious freedom to work longer to make up pension or benefit shortfalls is a "cop-out," he says. What next, he asks, a 60-hour workweek?

The "emotional appeal" of a 64-year-old who wants to keep working is hard for the union to counter, he concedes, but he doubts the public appreciates the sweeping ramifications of the issue. If age isn't the criterion for leaving the workforce, performance will be. Older workers, with higher insurance and disability costs, will be fired at the first dip in productivity -- an uglier end to one's working life, he warns. "You'd have to be living on Mars to not expect that employers will find ways to get rid of people."

Mandatory retirement is already banned in Australia, New Zealand and, for a generation now, in the United States. The Americans have taken the next logical step -- they're raising the eligibility age for full retirement benefits and Medicare to 67 from 65. Even that may not be enough to spare an aging America from disaster, warns U.S. Federal Reserve Board chairman Alan Greenspan, 78.

The leading edge of the baby boom starts drawing retirement benefits in 2008, a hit the U.S. economy can ill afford, Greenspan told a Congressional committee last year. He advocates cuts to inflation indexing in advance of the boomer wave. "This is a much larger problem than we can handle," he says.
Canada faces a similar demographic bulge and some of the same economic challenges, says Jonathan Kesselman, 58, a professor of public policy at Simon Fraser University. Currently, there are four people working per senior. By mid-century there will be just two workers per senior, a shift that will have a huge impact on the economy and labour supply.

"It makes little sense that average retirement ages have been declining at the same time that lifespans have been rising as the health status of older persons improves, and the physical demands of most jobs are falling," he says. "A person entering the workforce at age 22 and retiring at 61 is spending just 39 years at work, barely half a lifetime."

The Canada Pension Plan appears sound for at least the next 75 years, due to a substantial jump in contribution rates, but Kesselman questions whether a heavily retired Canada can afford such tax-funded benefits as old-age security and health care. He wants politicians to screw up the courage to phase in an increase in the age for full pension benefits as the United States has done.

Raising the pensionable age may not be on the political agenda yet. But offering the choice of an extended working life certainly is. Age-based retirement is already banned to varying degrees in all three northern territories and in Manitoba, Quebec, Alberta and Prince Edward Island. In 2003 the government of Ontario stated its intention to end mandatory retirement.

Age 65, in fact, is increasingly irrelevant as a retirement date. Half of workers are now off the clock before age 61. At the other end of the scale, Statistics Canada estimates 305,000 people 65 and older were employed in 2001 -- almost a 20 percent increase in five years.

Patt Noga, executive director of the 50+ Job Bank in Winnipeg, sees such people every day. Some have collected buyouts only to seek work when the money runs low or when they start climbing the walls. "A lot of them have skills they still want to use. They're proud of them," she says.

A case in point is her 63-year-old husband, Brian Noga. By day, he's an accountant for a Manitoba regulatory agency. By night, he's studying to become a certified general accountant. "I'm probably going to have to work until I die," he says with remarkable good cheer.

Part of the reason is financial. Like many Canadians, he hasn't saved enough to live on, a situation worsened when his technology stocks took a plunge. Then, too, he sees retired friends for whom the high point of the day is reading the newspaper. Working keeps you sharp, he says. "If you just sit back and vegetate, everything starts to fall apart, your mind and your focus. I don't want that to happen."

Boomers, having never acted their age, aren't likely to start now. If age 65 becomes the new 50, does that make work the new retirement? Not likely. A generation notoriously averse to heavy lifting is likely to define retirement on its own terms. Optional retirement, freed of the arbitrary restraints of age, is apt to be taken in installments: a bit of play, perhaps a spot of do-goodery -- and just enough work to keep the economy from collapsing upon their frantically toiling children.

Should the retirement age be raised to 67 or even higher? Should mandatory retirement be banned altogether across the country?

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