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Older Workers Are Shaping a Stronger, Vibrant Economy

Bob Edwards, Chris Farrell talk about a growing movement of older entrepreneurs, part-time workers

Take on Today Podcast

AARP

Bob Edwards: Hello. I'm Bob Edwards with an AARP Take on Today.

Although it was coined 50 years ago, the word agism is, ironically, an old idea. Unemployment is low. People are living longer, healthier lives. Their experience and knowledge have no expiration.

Breaking it down for us today is Chris Farrell, senior economics contributor for Marketplace and author of a new book, Purpose and a Paycheck: Finding Meaning, Money, and Happiness in the Second Half of Life. He has a compelling story about how a growing movement of older entrepreneurs and workers is creating a stronger and more vibrant economy.

Thanks for joining us, Chris.

Chris Farrell: It's good to be here.

Bob Edwards: You're 65, and you're still working. Tell me about the Still Syndrome.

Chris Farrell: The Still Syndrome comes from John Kenneth Galbraith, the great economist. He was 90 years old, and he wrote this essay about people would come up to him and say, "You're still drinking? You're still exercising? You're still writing?" Of course, his favorite was, "You're still alive?"

He called it the Still Syndrome, and it's a sense that, once you're 60, 65, you're supposed to fade away gracefully but fade away. You don't really have anything to contribute to society. You don't have anything, really, to offer and, therefore, fade away. Then, when someone sees you doing something, they go, "Wow, he's still engaged." Of course, Galbraith, who would continue to write until he died, what, seven years later at age 97, hated the Still Syndrome.

Bob Edwards: You have a new book, Purpose and a Paycheck: Finding Meaning, Money, and Happiness in the Second Half of Life. Why did you decide to write that book?

Chris Farrell: Because I think there is a major transformation in our society that is still under appreciated. We have an aging population, and part of it is the aging of the Baby Boom population, but it's more fundamental than that. It is we're living longer, on average, we're having fewer children, so we have this aging population. Bob, you know, over the years, this has been treated as gloom and doom. We're just going to have too many of these older people being supported by too few young people, and our economy is going to deteriorate, and the underlying dynamics of our economy will fade away: the Still Syndrome. The argument in my book is that this is fundamentally wrong on so many levels, and what is happening and under appreciated is that more and more people are working longer. They're starting their own businesses, they're self-employed, and they are contributing and will continue to contribute to our economy.

Bob Edwards: Yeah. You wrote about the myth of creative decline and share some examples of artists who have either hit their strides later in life or built on already successful careers. What do their stories tell us about your average person?

Chris Farrell: I think what they tell about the average person ... If you were creative in your 20s, your 30s, there's no reason to think you won't be creative in your 50s, your 60s, your 70s. In fact, what the data shows us are two things that I think are really intriguing. One is... One way of looking at wisdom is it's connecting the dots. What you do, as you get older, you begin to connect the dots in certain ways. You draw on your experience. You draw on your knowledge.

The other thing that I just loved, it was from this researcher, Arthur Cropley in Germany, and he says, "Look, here's the thing. As you get older, you don't want to do things that you no longer want to do. You don't want to be told, 'Hey, do more with less.' You have this ability to say, 'This is what I want to be doing. This is what I want to be engaged in.'" Creativity often flourishes as you get older because you know what you want to be doing and because you have this ability to start connecting the dots.

Bob Edwards: So much for creativity. What about productivity?

Chris Farrell: Productivity. There's all this research. A lot of it's coming out of Europe, and it's looking at factory workers. There's this one study by a group of economists, and they got access to a Mercedes-Benz truck factory. They looked at the productivity, and what they learned is that productivity pretty much peaked when people were 60 or 65, just depending on when they retired. What they found makes sense. People make adjustments. Yes, they can't run around as quickly as they used to, may not be as physically active, but they make adjustments. They have knowledge, they have skill, they have experience, so they continue to do the job well.

There's another study, and this is a great one. It's from BMW. BMW realized that, for their production facilities in Germany, they were going to have an older workforce just because Germany has an aging workforce, and so they created what they call the pensioners' line. This reflected the workforce of the future. When they ran the initial pensioners' line, productivity was way below the productivity of their other assembly lines in the BMW factory in Germany. Then they made, Bob, these adjustments.

Now, these adjustments are cork floor board. I believe it was they changed the chairs. They made some adjustments with the computer screens, yoga, meditation, about $50,000, which might, what, buy you one BMW? I'm not exactly in the market for BMWs, but it probably buys you one BMW. For a company like BMW, invested $50,000, and now what they have found is that the productivity of the pensioners' line matches the productivity of their other lines. They're taking the lessons from that assembly line and putting it throughout all their assembly plants throughout the world because... Just because you're young doesn't mean it's a good idea for you to throw out your back or do things that aren't healthy for you.

Bob Edwards: How are stereotypes and age discrimination holding us back?

Chris Farrell: They are just holding us back enormously. Boy, the prejudices are just awful. You can be in a meeting. Now, anybody listening to this, think about it. You're in a meeting, and someone will go, "Oh, I'm having a senior moment. I can't remember." You got to go, "Oh, come on. Can we please get rid of this joke?" Or there is a problem, and it involves technology, and people or managers will go, "Well, we need some young people because they understand the technology."

These prejudices are deep, and they're ingrained in so many industries.

What is changing, and this is really important, is right now we have what's called a tight labor market. So many companies are looking for workers because they need to fulfill their orders. They need to fulfill their mission, and so, not out of enlightenment, but a lot of senior managements in organizations are now looking at their experienced workers with greater appreciation because they can do the job. And those stereotypes are starting to fall away. Still have a long way to go. Nonetheless, partly because of an aging workforce, partly because of this tight labor market that we're living in right now, there is a shift going on in the perception of older workers, but it's going to be a long time before we get rid of age discrimination.

Bob Edwards: Yet the working population is getting older. Why is this happening?

Chris Farrell: It just reflects the aging of the population, but also we're better educated than before. We're healthier than before. I think there's a growing recognition, Bob, that in the early post-World War II era, the 1950s, 1960s, 1970s when retirement really became available for the typical worker, it was something new that had never happened in history. It was available to the wealthy but not to the typical worker. A typical worker in the 1910s, they worked until they died. If you're living in a northern state, you move to the South, retirement community. This was a real shift.

I think, over time, people have learned that the notion that you hit age 60 or 65 or 62, whatever it is, and then you walk away from all the skill, all the knowledge, all the experience that you have accumulated through all the ups and downs of a career, more and more people don't want to do that. They want to be useful. They want to be helpful. Work is a community. You have people that you share a coffee with, you share jokes with. They're people you gossip with. There are people you don't like. It's a community. When they do these surveys, what do you most miss about your life before you retired? it's always about the colleagues, the suppliers, the vendors, the people that you knew.

Finally, we need the money. We're living longer. The notion that you can retire at age 60 and then live off your accumulated savings for 30 years, it's unrealistic, so a lot of things are coming together. One of the things I always get asked, "Well, are people working because they need to or because they want to?" My argument is, for most people, it's both.

Bob Edwards: Now we have a multi-generational workforce. How are workplaces benefiting from that?

Chris Farrell: I think workplaces are benefiting enormously. When you look carefully at the research, that's what comes out. The most productive teams in every company, every organization today, they have teams. They organize themselves in teams. It's recognized that this is a way to get a lot of work accomplished. What the research shows is the most productive teams are multi-generational. And that makes sense, but there is this cottage industry of consultants. They come into these organizations and they say, "Oh, you have all this conflict because of these different generations under the same roof," but the evidence is not there. We have the same thing in politics where you'll have politicians proclaiming that we're going to have intergenerational warfare. Fighting over scarce national resources. Yet, when you do the surveys, most adult children like their parents, most parents like their adult children, and there's not a great deal of intergenerational conflict.

I think this notion of intergenerational conflict is wrong. People want to be treated with respect. People want to be paid well for doing a good job. They want those opportunities to exercise their independence and their creativity, and they want to feel that they're part of a community. That is shared across the generations in any workplace.

Bob Edwards: A lot of concern about automation eliminating jobs, but is there a silver lining there?

Chris Farrell: I think there is. One of the things automation does is it makes it easier for people, as they get older, to continue working. I was interviewing an iron worker out of Cleveland. Was doing a story about blue collar workers finding second careers, third careers. He'd been an iron worker, retired at age 62, and he was working for a technical high school in Cleveland, and that was his second career. We're doing this interview. It's very interesting. His father had been an iron worker. He'd been an iron worker. His brother had been an iron worker. I said, "I have to ask you a naïve question. How did you be an iron worker when you're 60 years old?" There's this long pause over the phone. He goes, "Chris, there's such a thing as automation." He goes, "We're not lifting. The machines are lifting."

When you look at careers like nursing and automation is changing ... nurses are in less and less. Hospitals are less picking up people and moving them from the gurney to the bed or from the bed to the gurney. Now there are machines that are doing that, and that saves their back. I think what the history of automation tell us is, yes, it will destroy many jobs. It will also create many jobs. Most importantly, it will redefine what jobs' tasks are. Because of the automation, it will take over some of those tasks, and nurses and other people will be doing other things.

Bob Edwards: You also devote an entire chapter to lifelong learning. Does automation increase the importance of lifelong learning?

Chris Farrell: It does. It really does because automation is another way of saying that jobs are going to be redefined. There may be a different emphasis in terms of what skills that we need. We have a college and university system, a learning system that's really pretty good, youth, up to about age 24, and then companies and organizations take over with some training. But, it pretty much all ends by age 40. But, we're talking about a workforce that's going to continue to work, that needs to work, that wants to work, and they're going to need new skills.

I think one of the big revolutions that comes out of this working longer movement is colleges and universities are, themselves, going to have to become multi-generational institutions, and not just for the 60-year-old who wants to take the Renaissance Italy class that they never took when they were an undergraduate ... okay, those are wonderful classes, but for the 60-year-old who wants to pick up some skills in order to get a new job, that is going to be fulfilling. The notion that you can't teach an old dog new tricks, you've probably heard that expression so many times, is wrong. The research is absolutely compelling. People can continue to learn. They want to learn. They have to be given a reason why to learn.

That seems to be the one big difference where, as you get older, you want to be told, 'If you learn this, you'll get a promotion or you'll get additional pay or you have greater opportunities.' When we're younger, a lot of times, we're more willing to say, 'Okay. They're saying we should get this training. Let's go get this training.' As you get older, you kind of go, 'Okay. Why am I getting this training? Oh, that's why? Okay. I'll go ahead and do that.' We need those opportunities throughout our lifetime to continue to learn, to stay engaged in the workforce, and I think automation will put greater pressure on the education systems to respond to the needs of an aging workforce.

Bob Edwards: When we hear entrepreneur, a lot of us think about the tech startups in Silicon Valley, but that's not really the case, is it?

Chris Farrell: It really isn't. About a quarter of all new businesses in recent years have been created, started by the 55 to 64-year-old age group. When you think of entrepreneurship, it's Silicon Valley. It's Mark Zuckerberg or Dorsey of Twitter. In earlier generation, it was Steve Jobs with Apple computer and Bill Gates with Microsoft, but most businesses are started by people in between the ages 55 and 64. It makes sense because you have knowledge. You have skill. You have experience. You know what the market needs.

There's a fundamental shift in the way that we think about entrepreneurship. This, to me, was one of the big surprises in reporting on an aging population. 10 years ago, if you said entrepreneurship, I would have said, 'Oh, too risky, too risky. For the average person who's in their 50s or 60s, that's way too risky.' I was completely wrong because what's happened is people aren't risking their 401(k) or their home to start a business. Their home is the office, and they're using technology to test out their business, and they're using their contacts, and their skills, and their knowledge.

The typical business takes very little money to start, and many of these businesses will just stay self-employed, maybe a couple of part-time employees. Some of them may become much bigger, but entrepreneurship and self-employment is the leading edge of this working longer movement. The real key here is you don't have to worry about human resources. You don't have to worry about the algorithms of the human resources department. You don't have to worry about senior management's stereotypes about aging. You go off, you start your business, and your age becomes an asset.

Bob Edwards: What if you've never thought of yourself as the entrepreneurial type?

Chris Farrell: Well, and a lot of us haven't, and it isn't for everybody, but I would argue for an entrepreneurial mindset. The big question, as people enter their 50s and their 60s, is what's next? I've covered personal finance for, oh, 20, 25 years and with the rise of the 401(k) and the IRA. You look at all the business magazines and the Wall Street Journal and the New York Times, there's all these stories about will you have enough money to retire on? Well, that story is now changing. What that story is changing into is, rather than will you have enough money to retire on? it's what do you want to next?

As you think about what do you want to do next? it takes an entrepreneurial mindset. You may go from a for-profit job to a not-for-profit job. That's a very popular shift to make. Even though you're not starting your own company, you're researching what might be your opportunities. You're maybe volunteering in an organization and not just because it's something you believe in, but you're actually looking at this organization. Do I want to work here? If I want to work here, where are the opportunities for me? I guess what I would say is everybody needs an entrepreneurial mindset, but for those who are willing to start their own business, your 50s, your 60s, it's a great time.

Bob Edwards: Thank you, Chris.

Chris Farrell: Thank you.

Bob Edwards: That was Chris Farrell, economics commentator at Minnesota Public Radio. His book, Purpose and a Paycheck, is available online and in stores starting January 29th.

From the 'You Just Can't Make This Up' file is the story of Julie Anne Lisi who was browsing through a thrift store in Jupiter, Florida when she spotted an item that left her astonished and on the verge of tears.

On the shelf was an old baseball glove, well worn from weekend games of catch. Written in familiar handwriting on the tan leather was the name of her son, Christopher Lisi. Now 52, Christopher had lost his glove in the jubilation of hitting two home runs and his little league team's victory in Willoughby, Ohio 1,200 miles away and 40 years ago.

Needless to say, Julie Anne snapped up the glove for the asking price of $1.49, a bargain for a new old family heirloom. A retirement pastime for Julie Anne and her husband, browsing through thrift stores sometimes reveals a few treats and the occasional treasure but, this time, the treasured find was nothing short of priceless.

For more, visit AARP.org/podcast. Become a subscriber. Be sure to rate our podcast on iTunes, Stitcher, and other podcast apps. Thanks for listening. I'm Bob Edwards.

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Bob Edwards chats with Chris Farrell about how a growing movement of older entrepreneurs and part-time workers are creating a stronger and more vibrant economy.

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