Near retirees are in a unique position. The good news is that for the most part, they are living longer, are healthier than in the past, and have more work options than their predecessors. At the same time, there still is a significant number of them who perform physically challenging jobs—and that can affect their retirement readiness. 
Those whose jobs are physically demanding face more challenges in building retirement security than their peers who are not similarly situated. Industry experts in a Nov. 1 webinar offered their take on that challenge and what can be done about it.
Panelists included William Arnone, CEO of the National Academy of Social Insurance (NASI); Rebecca Vallas, Senior Fellow at the Century Foundation; Joel Eskovitz, Director of Social Security and Savings at the AARP Public Policy Institute; and Tracey Gronniger, Managing Director, Economic Security and Housing at Justice in Aging.
The NASI in September had issued a report by its Older Workers Retirement Security Task Force, a group the NASI convened to look at the challenges older workers who do physically challenging work face and to suggest policy options to assist them in preparing for retirement. Panelists, two of whom served on the task force, discussed the report and its import.
A Unique Situation
It may seem an anachronism that in the 21st century, physically demanding work still exists.
But it does. Vallas observed that while manufacturing is no longer the predominant form of physically demanding work, there are other forms older employees perform that still are demanding. Examples of jobs include home health care work, warehouse jobs and jobs that entail significant amounts of standing, such as restaurant and retail work.
And the population of employees in the category of older workers who do physically challenging work is considerable. Vallas noted that more than 10 million older workers are doing physically demanding work that involves difficult working conditions. Plus 15% of those who perform home health care work are between the ages of 50 and 65, she said.
Further, the report notes, physically demanding jobs are more likely to be done under contract, and therefore can be less stable. In addition, they often are performed by those who earn lower income and have less education than the average worker in the United States—and are predominantly members of minority groups.
“They’re in a twilight zone,” Arnone said of that subset of near-retirees. They’re not disabled, so they don’t qualify for SSI payments, and they’re too young to retire, he noted. Vallas added that the United State has one of the strictest definitions of “disability” among OECD nations.
The ‘50s Cliff’
Doing physically challenging work in the pre-retirement years—the “50s cliff,” the report calls it—can take a further toll on retirement readiness.
For instance, such jobs can result in “health shocks” that cause an employee to retire earlier than they had anticipated, reducing the ability to further save for the future and putting them at financial risk in their advanced years.
The recent COVID-19 pandemic, says the report, only exacerbated the situation for older workers in physically demanding jobs. Many of those positions were in sectors that required them to be present at the work site and not work remotely. That, in turn, put them at higher risk of exposure, and at a stage of life and health at which they were at greater risk of serious consequences.
The Bottom Line
The key take-away, said Vallas, is that “it’s especially hard” for those who are older than age 50 and who work in physically challenging jobs. “There are certain kinds of jobs you don’t want employees to do at age 65,” said Eskovitz.
What to Do
“The measure of success in helping such individuals prepare for retirement shouldn’t be perfect math,” said Gronniger.
Vallas said it would be helpful to seek better public policies for employees to better accomplish and ensure retirement security. Some of the options the task force suggests include:
- raising the Social Security minimum benefit;
- creating a bridge benefit between early claiming and full retirement age for workers who have done physically challenging jobs;
- revising the Social Security earnings test;
- allowing workers to claim partial early benefits;
- improving access to Social Security disability benefits;
- improving the Social Security Administration’s communications and public education efforts; and
- enhancing and better enforcing age discrimination regulations.
Improving the Social Security minimum floor, said Gronniger, “makes so much sense.”
But action by government agencies is not all that could help, Vallas suggested, remarking, “This is a real opportunity for employers.”
There already are standards that can be helpful for the private sector to apply, Eskovitz suggested. He noted that Social Security guidelines look at the toll a job takes on the body rather than an employee’s medical condition when there is an “early” claim for Social Security benefits.
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