Teresa Ghilarducci on ensuring financial stability for older workers
Many older workers want to keep working, but for those that want to retire there’s a big problem says Teresa Ghilarducci, professor and director of the Schwartz Center for Economic Policy Analysis at The New School. That problem is job quality. “I’ve been looking at the intersection between so many people not being able to afford to retire intersecting with the kinds of jobs that are being created.”
WorkingNation sat down with Ghilarducci at the Milken Institute Global Conference 2021 in Beverly Hills as part of our #WorkingNationOverheard interview series. With Charting a New Course as the guiding theme, thought leaders and innovators shared ideas about the changing economy, worker development, education, tech, philanthropy, and more.
“Most of those people will not have enough to retire on and that means they’re desperate for work. In technical terms, that means their reservation wage—their fallback position—is very low and they have no bargaining power. We are creating a desperate workforce, people in their 60s and 70s who will take any job because it’s available to them.”
Ghilarducci says that “pensions are eroding and our retirement system is a failure” and that leaves older workers in vulnerable financial positions. She says reform is not an out-of-reach goal for the 63 million American workers who are currently working without a pension.
She points to the thrift savings plan that is available to federal workers and members of the military and argues it should be accessible to everyone. “You put a dollar into your pension when you’re in your 30s. You keep it there. It’s invested well. By the time you reach 62 or 65, (you end up) with $500,000, or maybe even a million dollars. You need a way to accumulate money to make it last your whole life.”
Ghilarducci says, as a society, improving the retirement system is just one step in ensuring that older workers who want to work can do so and feel financially secure. “We need to get the retirement system set, but there are a lot of other things we can do so that when older workers go to the job market, they will find jobs that have meaning. They will find jobs that give them some flexibility. They will find jobs that don’t break down their health.”
Click here to learn more about Schwartz Center for Economic Policy Analysis at The New School.
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