Blurring the lines between work and retirement

It wasn’t that long ago that retirement was something that occurred to everyone at a certain age, typically 65. That was when you basically had to retire from your job, and that magic age was – not surprisingly – the same age where government and company pension benefits were designed to start.

But things these days are much different, writes Jim Wilson in Canadian HR Reporter. The lines between the workforce and the retiree population are blurring, and it may be retirees who have to pick up the slack in the labour market.

The problem, he writes, is the “Great Resignation,” where employees are “changing their jobs or careers amid the upheaval of the pandemic.” Retirees, he explains – as well as the semi-retired – may need to be tapped to take on those unfilled jobs.

He cites a recent survey by Express Employment Professionals that found 79 per cent of respondents wanting “to partake in semi-retirement by having a flexible work schedule,” or by being a consultant (62 per cent) or “working reduced hours with reduced benefits” (52 per cent).

That’s a big difference from the old days, when retirements occurred at a fixed date, Express spokesperson Hanif Hemani tells Canadian HR Reporter.

“There’s also been a bit of an attitudinal change amongst baby boomers that are retiring where they want a little bit more out of life; they feel like they still have a few good years to offer. And so this concept of semi-retirement is basically bridging these individuals from their traditional work and phasing them into retirement, rather than having a set end date when they’ll be gone,” Hemani states in the article.

Another interesting finding the story mentions is that 18 per cent of workers over 50 (this number comes from RBC) want to “push out their retirement date.” But, the article adds, only 22 per cent of employees say their employer even offers the option of semi-retirement.

So without a lot of formal “semi-retirement” programs in the workplace, the article notes, employers are doing things like “bringing retired employees back, either to be a knowledge expert (21 per cent), act as a mentor to current employees (16 per cent) or handle key client relationships (14 per cent).

The article concludes by suggesting employees have a chat with older employees – maybe two years before they plan to retire – to see what “retirement looks like” for them. Could it include part time post-retirement work, or consulting?

The idea of “phased retirement” is something that has been kicked around in the pension industry for years. The concept was fairly simple to explain – you might work 80 per cent of your previous hours and draw part of your pension (20 per cent) at the same time. Then, in a few years, maybe you move to 50-50, and then to 20 per cent work and 80 per cent retirement, and finally, full retirement.

The concept sounds simple but it would be an administrative headache for any pension plan. As well, you would probably need to have government pensions permit the same thing, and maybe registered retirement savings plans as well. A lot of legislation and administrative work. But perhaps the old idea needs to be dusted off and looked at with fresh eyes, given the new realities of 2022.

If you have been saving on your own for retirement, there’s a great program out there that’s been designed with people like you in mind. The Saskatchewan Pension Plan is an open defined contribution pension plan that individuals can join. Once you’re a member, you decide how much you want to contribute, and SPP handles the tricky parts of investing, and turning the investments into retirement income. Check them out today!

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