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A WRITER RECENTLY asked my opinion of gig economy jobs and how they could benefit retirees looking for extra income. I looked up the term to be sure my understanding was correct. It was—except we used to call the jobs “temporaries,” “part-time,” “project work” or “consulting.” As I told the writer, a gig economy job sounds pretty good for us retirees who want to keep active or supplement our income, especially if it doesn’t involve being a crossing guard.
But I’m not sure the whole gig thing is great for younger workers. I realize I’m a dinosaur when it comes to the workplace and my work experience has long been buried beneath the remains of the last Ice Age. Still, right or wrong, society must come to grips with the employment changes it’s wrought.
Gig work has helped sever the old relationship between employer and worker. Gigs provide flexibility, but they also place far greater responsibility on the individual. Gig economy workers need constantly to find new work, while also planning and taking action to safeguard their financial future, including retirement.
My experience could hardly be more different:
In 2019, finding such a job is virtually impossible, except perhaps in the public sector. In fact, such jobs don’t even exist at my former employer. Companies have all but abandoned pensions and benefits that encourage long-term employment. At the same time, it’s near impossible to find workers who want to spend most of their life at one company.
Given what you now know about me, it’s no shock to learn that my retirement planning was minimal, because that’s all that was required. I checked the progress of my growing pension and the survivor benefits that were part of it. I monitored my 401(k). In short, I could bank on guaranteed income, health benefits and life insurance, plus survivor income for my wife.
From age 18 until the day I die, my financial life has been and will be secured by my employment with a single company. I suspect that’s a strange and perhaps even scary statement—one that younger workers simply can’t relate to.
In 1995, with my employer facing stiffer competition, benefits were scaled back for anyone hired after that year. As the person in charge of employee benefits, I initiated those changes. The company-employee relationship that started in the early 20th century was gone: No more traditional pension, no more retiree health insurance, no more retiree life insurance. Since then, my successors have made additional changes, even trimming future pension benefits that older workers were counting on.
Recently, my former employer announced that retiree health and dental benefits would cease January 2021, and be replaced with a health reimbursement account, or HRA. Previous commitments to workers are easily discarded. Paternalism is passé.
While most Americans never had the benefits I’ve enjoyed and even fewer worked for the same employer for half a century, it’s clear that—beyond a paycheck—employers can’t be counted on as a source of financial security. The message to everyday Americans is clear:
Yes, you’re on your own.
Richard Quinn blogs at QuinnsCommentary.com. Before retiring in 2010, Dick was a compensation and benefits executive. His previous articles include What’s Your Plan, Staking Your Claim and What Do You Mean. Follow Dick on Twitter @QuinnsComments.
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You said your former employer decided to change retiree health care benefits in 2021. Does that decision mean your own retirement benefits will change, or just the benefits of future retirees (ones who retire after 2021)?
Actuaries did their best, but no one thought to allow for improved healthcare and thus greater longevity. Even now, pensions for fire and police still assume retirement at age 55, instead of shifting older workers to desk jobs and setting pensions to start at age 60 or later – making state and local governments struggle to cover costs.
I had a somewhat similar experience in my career. I gave similar advice to myself children and the younger employees I managed in the 2000s. Great article.