As workers approach retirement age, many are looking to make a gradual transition into full retirement by reducing their hours or job responsibility. This is referred to as “phased retirement.” Interest in phased retirement among older workers is growing, and many would like to extend their careers if given the right opportunity. Employers that act now to better align their retirement programs with workers’ interests and needs could find themselves at a huge competitive advantage as the economy rebounds and labor shortages reemerge.

Key Findings

• Phased retirement programs can encourage older workers to delay retirement.
• A sizable gap exists between what workers want and what employers currently allow in terms of phased retirement opportunities.
• Workers currently in phased retirement arrangements are motivated to “work in retirement” for a variety of reasons.
• Even informal phased retirement arrangements can create an incentive for workers to extend their working careers. These arrangements include flexible work schedules, fewer hours and/or less job responsibility.
• Phasers who work primarily for enjoyment are more likely to experience higher job satisfaction, enjoy good health and receive higher pay raises than their peers.

Looking Toward the Future

• Nearly two-thirds of full-time workers over age 50 hope to scale back their hours or work in a more flexible environment before retiring completely, indicating that demand for phased retirement programs is likely to increase in the coming years.
• Legislative and regulatory barriers will continue to discourage formal phased retirement programs for the foreseeable future.
• As the workforce ages and interest in phased retirement grows, employers that do not facilitate phased retirement could face a significant competitive risk.
  
  

	TABLE OF CONTENTS Introduction About the Survey Survey Results The Role of Older Workers and the Impending Labor Shortage The Rationale for Phasing Demographic and Industry Characteristics of Phasers What Keeps People Working? The Role of the Career Employer Looking Toward the Future: Tomorrow’s Phasers Strategies to Retain Older Workers Conclusion