Senate Republicans including Mike Lee (Utah), Marco Rubio (Florida), and Joni Ernst (Iowa) are talking up a new proposal from the Independent Women’s Forum, a conservative economic policy shop, to establish a mechanism for US parents to access paid leave without creating additional costs for their employers by deferring their Social Security benefits in retirement, the Hill reports:
According to IWF’s six-page proposal, parents could take up to 12 weeks and receive on average 45 percent of their pay in a Social Security parental benefit that’s calculated using the same formula as Social Security disability benefits. The IWF estimates the average wage worker would receive $1,175 per month.
Lee said lawmakers are trying to figure out how to structure benefits so they are delivered to families when they need them, how the federal law should interact with state paid leave laws and how to keep the law from hastening the Social Security Trust Fund’s 2034 insolvency date.
Several House Democrats released statements criticizing the proposal, calling it “woefully insufficient” and arguing that working Americans should not have to forgo Social Security benefits to spend time with their newborn children. Democratic Rep. Rosa DeLauro also insisted that “any paid leave plan that reflects the needs of working people and families must address the need to deal with a personal or family member’s serious illness.”
The US is the only industrialized nation and one of only three countries in the world not to mandate paid time off for new parents, though the Family and Medical Leave Act guarantees mothers the right to unpaid leave during pregnancy and after childbirth. Many US employers, including the 20 largest private employers, offer some amount of paid parental leave, but millions of Americans lack access to this benefit.
Suzanne Woolley at Bloomberg discusses a new survey whose findings are unlikely to surprise anyone over the age of 35:
60 percent of those 18 to 34 in a Willis Towers Watson survey of more than 5,000 workers said they would forgo some of their pay if it meant a more secure retirement. That’s up from 42 percent when the same survey was taken in 2009.
“We’ve been seeing this percentage rise steadily for millennials” since the financial crisis, said Steve Nyce, senior economist at Willis Towers Watson. “They’re struggling with the economic environment they’re in, with having debt levels no other generation really had to deal with, and they’ve recently seen parents near or at retirement go through significant turmoil with the decline of the stock market in 2008-2009.”
Trading pay for a more secure retirement is an easy choice to make when it’s not a real decision. But it does make some sense, given the sorry state of retirement savings in the U.S. Millennials may be especially anxious since many don’t believe Social Security will be around when they need it.
This finding is another piece of evidence in favor of the view that the supposedly unique qualities of millennials are really products of them being young. The oldest of the millennials—those who took the biggest career hit from the financial crisis and the ensuing recession—are now in their early to mid-30s, so it’s no grand surprise to see more millennials thinking more about retirement as they get a little bit older and wiser.
As the US workforce ages—a lasting change, judging by broad demographic trends—an increasing number of employers are discovering the importance of attracting and retaining older employees, though too many still fail to appreciate the value of this cohort, Julie Cook Ramirez writes at HRE:
Given that older employees will comprise an increasing share of the workforce, employers must find new and innovative ways to retain and engage them, put their vast knowledge and expertise to good use, and help them prepare to make a graceful exit when the time is right. A few savvy employers have taken significant steps in that direction. … Organizations are not merely turning to older employees out of desperation, but for the deep breadth of knowledge and expertise several decades in the workforce have given them. …
“Employers and HR people are so fixated on the question of millennials and how to court them that they are ignoring this other, bigger group of folks who actually are better suited to what they say they want, which are skills and experience, the right work attitude and the ability to communicate with people,” says [Peter] Cappelli, also co-author, with Bill Novelli, of Managing the Older Worker: How to Prepare for the New Organizational Order. “Older workers have all those things.” …
New data from Gallup shows that the age at which Americans expect to retire is steadily increasing:
Thirty-one percent of nonretired U.S. adults predict they will retire after age 67, the current minimum age for receiving full Social Security retirement benefits. Another 38% expect to retire between the ages of 62 and 67, spanning the existing Social Security age thresholds for benefits eligibility, while 23% expect to stop working before they turn 62 — that is, before becoming eligible for any Social Security retirement benefits.