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35–956 PDF 2007

S. HRG. 110–68

THE AGING WORKFORCE: WHAT DOES IT MEAN

FOR BUSINESSES AND THE ECONOMY?

HEARING

BEFORE THE

SPECIAL COMMITTEE ON AGING 

UNITED STATES SENATE

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

WASHINGTON, DC

FEBRUARY 28, 2007

Serial No. 110–3

Printed for the use of the Special Committee on Aging

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html 

SPECIAL COMMITTEE ON AGING 

HERB KOHL, Wisconsin, Chairman 

RON WYDEN, Oregon 

BLANCHE L. LINCOLN, Arkansas 

EVAN BAYH, Indiana 

THOMAS R. CARPER, Delaware 

BILL NELSON, Florida 

HILLARY RODHAM CLINTON, New York 

KEN SALAZAR, Colorado 

ROBERT P. CASEY, Jr., Pennsylvania 

CLAIRE McCASKILL, Missouri 

SHELDON WHITEHOUSE, Rhode Island 

GORDON SMITH, Oregon 

RICHARD SHELBY, Alabama 

SUSAN COLLINS, Maine 

MEL MARTINEZ, Florida 

LARRY E. CRAIG, Idaho 

ELIZABETH DOLE, North Carolina 

NORM COLEMAN, Minnesota 

DAVID VITTER, Louisiana 

BOB CORKER, Tennessee 

ARLEN SPECTER, Pennsylvania 

JULIE COHEN, Staff Director 

CATHERINE FINLEY, Ranking Member Staff Director 

(II) 

C O N T E N T S 

Page 

Opening Statement of Senator Herb Kohl ............................................................. 1

Opening Statement of Senator Gordon Smith ....................................................... 3

PANEL I 

David Walker, Comptroller General, U.S. Government Accountability Office, 

Washington, DC ................................................................................................... 4

Donald Kohn, Vice Chairman, Board of Governors of the Federal Reserve 

System, Washington, DC ..................................................................................... 23

PANEL II 

Marcie Pitt-Catsouphes, director, Center on Aging and Work/Workplace Flexibility, Chestnut Hill, MA ..................................................................................... 49

Javon Bea, president and CEO, Mercy Health Systems, Janesville, WI ............ 65

Preston Pulliams, district president, Portland Community College, Portland, 

OR .......................................................................................................................... 69

APPENDIX 

Prepared Statement of Senator Larry Craig ......................................................... 83

Statement submitted by HR Policy Association of American Benefits Council . 84

Statement submitted by NCCNHR ........................................................................ 88

Comptroller General’s Highlights of a GAO forum, Engaging and Retaining 

Older Workers ...................................................................................................... 91

Information submitted by AARP ............................................................................ 116

A Report on the Survey of Students 40 and Older, conducted by the Portland 

Community College .............................................................................................. 136

Report prepared for the Oregon Age Boom Conference by the University 

of Indianapolis ...................................................................................................... 170

(III) 

(1)

THE AGING WORKFORCE: WHAT DOES IT 

MEAN FOR BUSINESSES AND THE ECONOMY? 

WEDNESDAY, FEBRUARY 28, 2007 

U.S. SENATE, SPECIAL COMMITTEE ON AGING, Washington, DC. 

The Committee met, pursuant to notice, at 10:32 a.m., in room 

SD–628, Dirksen Senate Office Building, Hon. Herb Kohl (chairman of the committee) presiding. 

Present: Senators Kohl, Carper, Casey, Smith, and Corker. 

OPENING STATEMENT OF SENATOR HERB KOHL 

The CHAIRMAN. Good morning. We welcome our witnesses to this 

hearing. They will talk about both the challenges and the opportunities that we confront as our aging population changes the face of 

our workforce. 

Today, people over the age of 65 make up about 12 percent of the 

population, but they will make up almost 20 percent in the next 

25 years. In other words, one out of every five Americans will be 

a senior by the year 2030. 

Experts are talking about what this demographic wave will mean 

for Social Security, Medicare and long-term care. But as we will 

hear today, we must also address another piece of the puzzle, 

namely, how the retirement of the baby-boomers will impact the 

strength of our Nation’s businesses and our economy. 

According to one estimate, as the baby-boomers reach retirement 

age, businesses will face a severe shortage of 6 million workers by 

2012, and that will grow to 35 million workers by 2030. Slower 

growth in the labor force means slower economic growth and, 

therefore, lower living standards for everybody in our country. 

In essence, the retirement of the baby-boom generation threatens 

to limit the potential of our economy, to lower the speed limit on 

how fast it can grow. Today, the Federal Reserve will present a 

projection by its economists that economic growth could decline significantly to 2.2 percent by 2015, compared with an average of 3.2 

percent over the past 40 years. 

But demography is not destiny. Today, only about 20 percent of 

men and 12 percent of women over age 65 participate in the labor 

force at all. Our challenge is to boost those numbers. 

Studies show that as older Americans live longer and healthier 

lives, many are planning to work longer. According to a recent survey, 80 percent of boomers expect to work past the traditional retirement age. Some may recognize the physical and mental benefits 

of work, while some may need the additional income to remain fiVerDate 0ct 09 2002 15:20 Jun 29, 2007 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 H:\DOCS\35956.TXT SAGING1 PsN: JOYCE
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nancially secure as they struggle to stretch their retirement savings. 

A few businesses today are paving the way to attract and retain 

older workers. One example who will testify today is Mercy Health 

System of Wisconsin, who was named AARP’s number-one employer for older workers because of policies such as flexible work 

schedules without a loss of benefits. 

However, surveys show that while most employers are aware of 

the looming brain drain, they are not prepared for it. We cannot 

afford to wait until the retirement wave is upon us. We must encourage businesses to adopt policies now to attract and retain older 

workers as they are confronted with the coming labor force shortage. 

The message could not be more urgent, as time is short. For, 

after all, the first of the baby-boom generation will reach retirement age next year. 

Today, I am pleased to be introducing two bills that benefit older 

workers and businesses in America. 

First, along with Senators Cochran, Durbin, Lincoln and Craig, 

we are proposing a tax credit for businesses that employ older 

workers and offer flexible work programs without a loss of health 

or pension benefits. Many older workers would delay retirement if 

their employers, like Mercy Health System, offered flexible work 

schedules with benefits. 

Second, along with Senators Cochran and Durbin, we are introducing a bill to extend COBRA health coverage for older workers, 

improve their access to Federal job training programs, and establish a national clearinghouse of best practices for hiring and retaining older workers, the sort of clearinghouse that GAO will recommend today. 

Senator Smith and I have made this issue a priority for this 

Committee. Together, we spearheaded a Department of Labor task 

force on the aging workforce, and its findings and recommendations 

are due this summer. We are also working together, along with 

Senator Conrad, on a bill that will include a range of additional 

ideas to make it easier for older Americans to stay in the workforce 

longer. 

This effort must go beyond legislative proposals. We need to 

begin a national discussion to change the way we think about retirement. A one-size-fits-all approach will no longer match the very 

different plans that seniors and baby-boomers have for their later 

years. So we must incorporate this new mindset into our national 

culture. As we will hear today from our witnesses, our Nation’s economic future depends on it. 

I turn now to my esteemed colleague and the Ranking Member 

on this Committee, Senator Gordon Smith.

3

OPENING STATEMENT OF SENATOR GORDON H. SMITH 

Senator SMITH. Thank you, Chairman Kohl, for holding this important hearing. 

We thank all of our witnesses and those attending today. I look 

forward to a productive discussion. 

As the Chairman has just indicated, we are about to experience 

an unprecedented demographic shift with the aging of the babyboomer generation. Many, including myself, have referred to this as 

a demographic and aging tsunami. 

According to the Bureau of Labor Statistics, by 2030, about 24 

percent of the population, or 66 million Americans, will be age 65 

or older. Compare this to 2000, when just over 15 percent of our 

population was over age 65. 

The aging of our population, along with a number of other 

trends, will have significant impact on many aspects of our society, 

not the least of which will be strains on Social Security, Medicaid 

and Medicare. 

The aging of America will also impact our labor market, including potential labor shortages. This would hurt both competitiveness 

of many American businesses and our economic growth as a whole. 

We also must be concerned with a possible brain drain. Our 

workforce will be losing some of our most experienced workers, 

many of whom have skills that are simply not easily replaced. 

However, the effects of these trends can be mitigated if older 

workers—and, again, I emphasize older workers by their own 

choice—decide to stay in the workforce longer. I am pleased to be 

working with Chairman Kohl to address this issue. 

In response to our urging, the Labor Department has convened 

the Task Force on the Aging of the American Workforce. This initiative has brought together agencies from across the Federal Government to collectively address the workforce challenges and help 

develop opportunities for our aging population. 

The task force plans to finalize its findings and recommendations 

sometime this summer. I look forward to their input, and I expect 

it will provide us with many legislative ideas and opportunities to 

get ahead of this problem. 

In addition, I am working with Senators Kohl and Conrad to develop legislation addressing the older workers issue. Specifically, 

our bill will provide incentives to older Americans to stay in the 

workforce longer, encourage employers to recruit and retain older 

workers, and eliminate barriers to working longer. 

So I thank all of you for being here today. 

I want to particularly thank one of my constituents, Preston 

Pulliams of Portland Community College. He is with us today. 

Portland Community College has been a leader in supporting older 

learners who want to remain in the workforce, and I look forward 

to hearing from him and his valuable insights on this matter. 

So, thank you, Senator Kohl. That is all I have. 

The CHAIRMAN. Thank you, Senator Smith. 

Senator Corker, do you have any comments you would like to 

make? 

Senator CORKER. I will listen to the wisdom of—I am looking forward to the report that they are going to be making from the floor. 

Thank you. 

4

The CHAIRMAN. Thank you so much. 

Senator CORKER. Yes, sir. 

The CHAIRMAN. Senator Casey, do you have any comments? 

Senator CASEY. I, as well, will wait for the testimony. Thank you. 

The CHAIRMAN. Thank you so much. 

We turn now to Panel 1. Our first witness will be David Walker, 

who is comptroller general of the United States and head of the 

U.S. Government Accountability Office, GAO. 

Mr. Walker has long taken an active interest in retirement policy 

and issues confronting our aging population. He and his staff have 

been an invaluable resource on this issue, and their work has been 

a real catalyst for action. We are pleased that Mr. Walker is here 

today to tell us about his most recent contribution, a forum that 

he convened on older workers. 

Our second witness on the first panel will be Dr. Donald Kohn, 

who is Vice Chairman of the Board of Governors of the Federal Reserve System. Dr. Kohn has served as a member of the Board of 

Governors since 2002. He was sworn in as Vice Chairman in June 

of 2006. 

He has more than 20 years of experience at the Federal Reserve 

and holds a Ph.D. in economics from the University of Michigan. 

Dr. Kohn is here to discuss declining labor force participation in an 

aging society and the impact on the labor force and on economic 

growth. 

We are very pleased to have you both with us this morning, and 

we will take your testimony. 

Mr. Walker, we would love to hear from you. 

STATEMENT OF DAVID WALKER, COMPTROLLER GENERAL, 

U.S. GOVERNMENT ACCOUNTABILITY OFFICE, WASHINGTON, 

D.C. 

Mr. WALKER. Thank you, Mr. Chairman, Senator Smith, other 

senators of the Senate Aging Committee. I assume that my entire 

statement will be entered into the record, Mr. Chairman——

The CHAIRMAN. Without objection. 

Mr. WALKER [continuing]. Therefore, I will move to summarize. 

I am pleased to be here today to talk to you about the opportunities and need for incentives for older workers to continue to contribute their considerable skills and knowledge and why it is vitally 

important, not just to them as individuals, but also to our national 

economy. 

By the way, many people use the term ‘‘older workers.’’ I prefer 

the term ‘‘seasoned workers’’ in order to recognize the considerable 

skills, knowledge, and experience that these individuals, who have 

more years, can bring to our workforce. 

As I know you are aware of, and as I know that my colleague 

at the table will testify, there are dramatic demographic changes 

that are a certainty that we are going to face, and, therefore, there 

is a need to focus on this issue. 

There are a number of benefits that could be attained by better 

capitalizing on the tremendous national resource evidenced by and 

reflected in older workers. 

First, many of these individuals need to work longer in order to 

boost their retirement savings. 

5

Second, having seasoned Americans work longer will help employers deal with the projected labor force shortages that we expect 

to occur. 

Third, having individuals contribute their skills and knowledge 

longer will help us with economic growth and will enhance Federal 

revenues, as well as helping to defray some of the anticipated costs 

associated with the tsunami of entitlement spending that is on our 

horizon. 

Last, but certainly not least, several studies have shown that the 

longer people are mentally and physically active, the longer they 

are likely to live and, in many cases, the happier they might be. 

Despite all the potential gains of having seasoned Americans 

work longer, there are a number of barriers that have prevented 

them from doing so. Some of these are legal, some of these are cultural, and some of these are reflected in other areas. 

We clearly believe that more needs to be done by employers as 

well as individuals and possibly the Government in order to facilitate the more effective utilization of this large and growing national resource. 

At the same time, we must recognize that there are some Americans who, because of physical disabilities or otherwise, may not be 

able to work longer, despite the fact that our economy is becoming 

more knowledge-based, and, therefore, brain power rather than 

brawn power is really what will drive most of our future economic 

growth. 

On December 5, 2006, we held a forum at GAO on this issue. I 

believe a copy of the report has been provided to all the Senators, 

and I will not discuss it in detail. But I will tell you that it was 

a very informative session. There were a number of observations 

and recommendations that came out of that forum. 

It is important to note that individuals from broad perspectives 

came together, agreed on a number of issues, but that this summary does not necessarily reflect the opinion of any individual or 

organization that participated, including GAO, although I am 

happy to let you know what our views are in the Q&A session. 

Forum participants reported that obstacles continue to hinder 

the ability of individuals to work longer; that certain employer perceptions regarding older workers are outdated and need to be effectively addressed; that there are a variety of best practices, however, that some employers are utilizing in order to attract and retain more seasoned workers, including more flexible work arrangements and adapting their job design to better suit the needs and 

interests of seasoned workers; that they are also modifying their 

benefit programs and other policies to try to help achieve this objective. 

There clearly was a recognition that there is a need to enhance 

financial literacy, because, in many cases, quite candidly, we have 

individuals who are retiring who do not realize that they cannot afford to retire, that they will not have enough income to be able to 

maintain their standard of living for the period of time that they 

are likely to live post their retirement date. 

There are a number of things that I think should be considered, 

including looking to determine whether or not our existing pension 

laws, our social insurance programs, might need to be modified in 

6

order to encourage people to work longer, not necessarily to require 

them to work longer but to encourage them to work longer. 

We also need to look at our age discrimination laws and our employment and training practices to find out whether they might 

have to be modified in order to better capitalize on this resource. 

In summary, engaging and retaining older workers is critical for 

promoting economical growth, improving Federal finances, and 

shoring up retirees’ retirement income security. Given existing 

trends and the aging of baby-boomers, pressures on Federal entitlement programs, and threats to individuals’ retirement security, it 

is in our Nation’s interest to encourage Americans to work longer. 

Despite evidence indicating the future importance of seasoned 

Americans to contribute longer to the workforce, there are various 

barriers and misperceptions that continue to get in the way of 

making progress. 

Clearly, there are things the Federal Government should consider doing, including, among other things, promoting the formation of a public-private partnership and a Federal clearinghouse to 

be able to increase awareness of this issue and to promote best 

practices among interested parties. 

Thank you, Mr. Chairman. I am more than happy to answer any 

questions that you and the other members have after my colleague 

has an opportunity to speak. 

[The prepared statement of Mr. Walker follows:]

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The Chairman. We thank you, Mr. Walker. 

Now we turn to Dr. Donald Kohn. 

STATEMENT OF DONALD KOHN, VICE CHAIRMAN, BOARD OF 

GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, DC 

Mr. KOHN. Thank you, Mr. Chairman. 

Chairman Kohl, Senator Smith, Members of the Committee, I am 

pleased to be here today to discuss some recent research at the 

Federal Reserve on the effect that population aging may have on 

the growth of the labor force. 

I, too, will be reading a somewhat condensed version of my testimony, and I will be referring to charts at the end of my testimony 

that are also on the easel over here to my right. 

As we all know, the United States is at the front edge of a massive and important shift in the demographic composition of the 

population. Exhibit 1 shows that, around 2003, the population of 

those age 62 and older began growing as a share of the population 

age 16 and older. According to projections from the Bureau of the 

Census, shown in the shaded area of the exhibit, this upward trend 

in aging will steepen noticeably in the next few years. 

A subset of the adult population is in the labor force, that is, are 

either actively looking for work or have a job, and this is shown 

in Exhibit 2. Because the participation of men and women in the 

labor force declines sharply after age 50, the rising share of older 

individuals will put significant downward pressure on the total 

labor force participation rate in coming years, provided the basic 

pattern of participation over the life cycle is maintained. That is 

the pattern you can see on the chart in the rise and, in particular, 

the fall after age 59 in that participation. 

Changes in the labor force behavior within age groups also have 

the potential to affect labor force participation. Exhibit 3 shows 

that by the time men born in 1935 reached age 30, about 97 percent of them were in the labor force. In contrast, only about 92 percent of the 30-year-old men born in 1976 were in the labor force. 

Now, until recently, this decline in the labor force participation 

rate of successive generations of men had been more than offset by 

a steady increase in the participation rates for each new generation 

of women. Women born in the 1920’s and 1930’s had low participation rates at age 30, but three-quarters of the 30-year-olds born in 

1960 were in the labor force. However, participation rates for more 

recent generations of 30-year-old women have not risen any further, and you can see the red line levels out in that chart. 

Economists at the Federal Reserve have developed a model that 

combines information on the decline in labor force participation at 

older ages with information on changes in the labor force participation across generations. Exhibit 4 shows the actual participation 

rate, the model’s estimate of the underlying trend between 1995 

and 2006, and the model’s projection of the trend in participation 

out to 2015. 

Now, as you can see from the red line in that chart, the estimated trend has been declining since about 2002 and is projected 

by the model to fall substantially further by 2015. I would add that 

24

if the chart were extended, that line would continue to move downward. 

That decline in the overall participation rate, coupled with the 

slowing in the growth of the working age population projected by 

the Census Bureau, would be consistent with a slowing in the annual growth of the labor force from the roughly 1.25 percent average of recent years to only a .25 percent rate of increase in labor 

force by 2015. 

Now, this forecast is predicated on a number of assumptions, 

some of which may not be borne out. As I outline in Exhibit 5, several factors that are not incorporated into the model may work toward raising the labor force participation rate. In particular, increasing longevity and improvements in health may induce many 

more individuals to remain in the workforce well past age 65. 

For their part, employers, upon facing slower growth in the labor 

force, may attempt to attract and retain older workers by enhancing wages and benefits, creating more flexible work strategies and 

schedules, and increasing training. 

Government policies can also influence the attractiveness of remaining in the workforce. For example, to raise participation rates 

among older individuals, policymakers could seek ways to preserve 

or enhance the incentives to work beyond traditional retirement 

age. 

Finally, to a limited extent, immigration has the potential to 

alter the future pace of labor force growth. 

Some of the influences described above may already be boosting 

the participation rate relative to the model’s prediction. As shown 

in Exhibit 6, the labor force participation rate of individuals aged 

62 and older has been rising markedly since 1995. To some extent, 

this increase simply reflects the aging of a generation of women 

who were more likely to be in the labor force throughout their lifetimes than earlier generations. However, the magnitude of the rise 

is greater than can be explained by this factor alone. 

Reflecting the considerable uncertainty that surrounds any longterm economic projection, economists hold a range of views about 

the pace of future labor force growth. 

A projection from the Congressional Budget Office is shown in 

Exhibit 7. The CBO foresees the pace of trend labor force growth 

slowing to .5 percent by 2015. That is a smaller deceleration than 

projected by the model that the Board staff has, but it is still a 

very significant slowing. 

As I indicated at the outset, the aging of the population has important implications for future generations. Because total output is 

equal to output per worker times the number of workers, a slowdown in the rate of labor force growth will, all else equal, tend to 

slow the growth of output, and that is shown in the rightmost column of Exhibit 7. 

Moreover, if the growth in the labor force is lower than population growth, output per person will, all else equal, rise even more 

slowly than output per worker. 

Indeed, as indicated by comparing columns 1 and 2 with column 

3 in the exhibit, both the Federal Reserve’s staff projection and the 

CBO projection for growth of the labor force through 2015 are 

lower than the growth of the population expected in that period by 

25

the Census Bureau. Consequently, on these projections, the level of 

output per person will be lower than it would have been without 

population aging. 

Increasing labor force participation would help reduce these effects, but is unlikely to completely offset them. Thus, without an 

offsetting increase in productivity growth, the aging of the population likely means that output per person will have to be lower 

than it would have been in the absence of population aging. 

Accordingly, a critical question is how that burden will be distributed across generations. If we do nothing, it will by default fall 

entirely on future generations. However, by foregoing some consumption today to increase national saving, we can take on some 

of that burden today and thereby raise the living standards of future generations. 

A rise in saving can achieve that shift, because the extra savings 

would be used to increase the Nation’s stock of capital or increase 

our net holdings of foreign assets. Increasing the amount of productive assets owned by Americans increases the amount of consumption that future generations will be able to enjoy. 

Determining the best way to distribute the burden associated 

with the aging of the population should be high on society’s list of 

priorities. 

Thank you, Mr. Chairman. 

[The prepared statement of Mr. Kohn follows:]

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The Chairman. Thank you, Dr. Kohn. 

Mr. Walker, your forum participants said that most businesses 

are not focused on this issue and may not act until there is a crisis. 

Given the labor force projections, do you think that Government 

has an important role to play in encouraging businesses to act 

sooner to attract and to retain older workers? 

Mr. WALKER. Given the significant national implications that 

both of us have talked about, I do think that there is a broader 

public interest. I think that consideration needs to be given as to 

how public-private partnerships might be able to be used in order 

to enhance public education, and to facilitate sharing of best practices. 

I also think that Government should look at its own policies and 

programs to determine what it can do to lead by example. For example, the Government is the largest employer in the United 

States. What can and should we do in order to lead by example 

with regard to our own policies with regard to seasoned workers? 

Furthermore, as the Government looks down the road entitlement reform, namely Social Security, Medicare and Medicaid, tax 

reform and health-care reform, what can be done to try to facilitate 

and encourage people to work longer? I think there is a lot there. 

Hopefully, we will get some of that out of the Labor Department’s interagency task force that you referred to earlier. We are 

anxious to see what they come up with. 

The CHAIRMAN. Isn’t it true—and I think you are saying it is 

true—that our whole philosophy in this country, which has been at 

65 people just naturally retire, and our entitlement programs are 

predicated on that and pension programs are predicated on that, 

and we sort of drum it into the mindset of people in our country 

that when you get to be 65, you retire—that whole philosophy must 

change if we are going to get older people in the workforce? 

Mr. WALKER. Mr. Chairman, I think you are exactly right. I 

think a lot of times, people don’t realize that Federal policies can 

have unintended consequences. 

Let me take my father as an example, who was an executive 

with what now will be AT&T. He, was looking into determining 

when he was going to retire, and the fact that Social Security said 

you could retire at 62 had a significant psychological impact on 

him. 

Furthermore, his employer piggy-backed on the Social Security 

early retirement age and made the employer-sponsored programs 

equivalent to the Social Security program. So, there were tremendous psychological factors that were involved here. When you get 

right down to it, Social Security is not material to his particular 

retirement income, but that is something we need to think about. 

Frankly, I would respectfully suggest, I don’t know if there is 

anything as a normal retirement age anymore. Maybe there is an 

age at which you get full benefits, where you don’t end up having 

a penalty if you end up leaving earlier, or where you might get a 

supplement if you retire later. But words matter, and I think we 

need to think about our terminology and think about our policies 

in light of the tremendous changes in the economy and in light of 

the workforce shortages that we are expected to see in the future. 

The CHAIRMAN. That is very good. 

41

Dr. Kohn, I think you are telling us that if we don’t somehow anticipate what is happening, and perhaps even if we do, we will not 

be able to change the outcome; our standard of living is likely to 

be affected considerably by this change in demographics. 

Mr. KOHN. That is correct, Mr. Chairman. You can see it in the 

chart over there on Exhibit 7, and I think, partly, you see it in 

comparing the first or second column with the third column. 

We have a situation in which the labor force will be growing less 

rapidly than the population. That means each worker, in effect, is 

working for more people, and the consumption of the folks who 

aren’t working, who are dependent on the other folks, will have to 

be supported by their work. 

So we will have increases in standards of living, but they won’t 

be as rapid as they would be without the aging population. You can 

see, looking at, say, columns 4 and 5 there, we have enjoyed about 

a 2 percent increase in average standards of living over the last 10, 

11, 12 years. Now, look down to the last column, and that is about 

a 1.5 percent increase in the average standard of living. If people 

expect their recent gains to continue, they are going to be disappointed. 

So I think, yes, we do need to take steps to share the burden of 

how people retire and want to retire across generations. I think we 

need to take the steps that you and Mr. Walker have been talking 

about to encourage people to participate more in the labor force, to 

have more flexible work rules, to make sure that the Federal Government rules and the entitlement programs aren’t putting barriers up, either psychological or real barriers, to people adopting a 

more flexible attitude toward retirement. 

These are serious questions that stretch across generations that 

we need to confront. 

The CHAIRMAN. Thank you so much. 

Senator Smith. 

Senator SMITH. Thank you, Mr. Chairman. 

Mr. Walker, we are going to hear from a community college 

president from Oregon soon about skills. I am wondering, when you 

had your GAO older workers forum, did you focus at all on the 

skills gap that may exist for seniors and what we can better do to 

help remedy that? 

Mr. WALKER. We did talk some about that. Probably the biggest 

skills gap that exists is that many seasoned Americans aren’t as 

proficient with technology as younger workers are, in part, because——

Senator SMITH. I would be in that number, too, by the way. 

Mr. WALKER. Yes, and I would imagine there would be a lot—

but we don’t have to identify everybody. [Laughter.] 

That is a real challenge. Now, some jobs require proficiency with 

regard to the use of technology and some don’t. But I think that 

is clearly an issue that more attention has to be focused on, and 

that was probably the single biggest issue that came out. 

Senator SMITH. Yes. You know, I am just astounded at how much 

new technology comes out every year that is baffling to folks. That 

is probably undoubtedly an area where we can do a better job 

incentivizing community colleges to reach out and fill that gap. 

I don’t know if you have a comment on that, Dr. Kohn. 

42

Mr. KOHN. I agree that that is a problem for all of us, I think, 

most of us in this room. But I do think that technology also helps 

to simplify job tasks to a certain extent, and people can be taught. 

I don’t think I am as teachable today as I was 30 years ago, but 

I don’t think I have stopped learning, and I am using technology 

a lot better and a lot smarter than I did just a few years ago. 

So I think there are ways of adapting jobs and adapting the technology to most of the people in society. You don’t need to be cutting-edge, high-tech to use this. 

The technology is helping, I think, and should actually help older 

workers stay in the labor force by structuring the jobs in a more 

flexible way, for example, meaning that you don’t have to commute 

by car. Telecommuting and things like that are also a product of 

technology. So I think it is a plus as well as a problem. 

Mr. WALKER. I think we also have to keep in mind that, because 

of some of the comments that have been made earlier, many individuals may not want to embrace learning technology because they 

are planning to retire by a certain age, because they want to or because they think they can afford to, which, in many cases, they 

can’t. 

I think that one of the things that clearly has to happen is that 

we need to do more to help individuals plan, save, invest and make 

more informed decisions about when they really can afford to retire. 

There are many Americans that don’t realize that, with expected 

life spans, they have to have a lot more money than they may have 

at the point in time that they retire. That would provide them, 

then, another incentive to improve their skills such that they will 

ultimately be in a position to where they can retire comfortably at 

that point. 

The Pension Protection Act also was a positive step forward, 

which Congress passed last year. It provides some flexibility for individuals to go from full-time work to part-time work and draw on 

their pensions. That was a huge barrier before, because you had to 

change employers in order to draw on your pension, which, obviously, didn’t make a whole lot of sense. 

So we are starting to make some changes that I think are necessary, but much more needs to be done. 

Senator SMITH. I wonder if you can speak to financial planning 

literacy. I wonder if there is more that we could do at the Federal 

Government to foster that. 

I have a bill that requires Social Security every year to send seniors a retirement readiness checklist what with questions such as 

will it take for you to retire, what income will you need, have you 

determined your life expectancy, and what are you saving? 

I think you mentioned, David, that the savings rate is negative. 

I think most people—and if there are seniors watching this—understand that that calculation made by the Government is literally 

about two lines: What did you make, what did you spend, and the 

net is the savings rate. 

But I wonder if you could speak to the issue of what the Federal 

Government can better do, perhaps through the Social Security Administration, to facilitate financial planning literacy. 

43

Mr. WALKER. Well, first, it is my understanding that for the last 

2 years in a row, Americans spent more money than they took 

home, now, possibly because of taking out home equity loans—I 

mean, there are a lot of ways you can get there. But the last time 

that that happened, it is my understanding, was 1932 and 1933, 

which weren’t particularly good years for the economy. 

Now, we are in a very different situation than 1932 and 1933. 

I think one of the things we have to recognize is that we need to 

look at our education programs, and we need to start no later than 

high school and probably earlier than high school with regard to 

financial literacy. It is amazing to me how few young people really 

understand the basics. 

Unfortunately, many Americans are following the bad example of 

their Federal Government. They are spending more money than 

they make. They are adding debt at record rates, and they are facing increasing debt service costs due to compounding interest. 

So I would say that Government needs to lead by example more, 

but I would also say that we need to figure out how Government 

can work at all levels to increase financial literacy and related education efforts, starting early. 

Yes, we should think about what else could be done for individuals who are approaching retirement. But, quite frankly, in many 

cases, that is too late because people need to start thinking about 

planning, saving, investing and preserving for retirement so they 

can benefit from the miracle of compounding, because if they just 

find out late in the ball game, they have a lot fewer options. 

Senator SMITH. Dr. Kohn. 

Mr. KOHN. Senator, financial education has been a major initiative for the Federal Reserve over the last few years. Importantly, 

we are responding not only to the issues that Mr. Walker and you 

are talking about, the fact that people are living longer and need 

to think more carefully about what they have, but also the increasing complexity of the instruments available to people to borrow and 

to save. 

People need to understand the implications of what they are 

doing, the implications of the contracts they are signing for their 

future welfare. The Federal Reserve has a number of programs 

starting in schools, working hand in hand with school systems 

across the country to start this education process. But it is a big 

and growing problem. 

The financial miracle of our markets has extended a lot of opportunities down the income scale, across the age scale—opportunities 

for borrowing and saving that weren’t there 5, 10, 20 years ago. 

But extending those opportunities means that we need to make 

sure the folks that are newly attracted in the financial system understand what they are getting and what the implications are. 

It is a big issue. 

Senator SMITH. Thank you very much. 

The CHAIRMAN. Thank you, Senator Smith. 

Senator CORKER. Senator CORKER. Yes, Mr. Chairman. 

Thank you. This has been great testimony. 

Yesterday, in our offices, we went through some of the tremendous financial implications to our country and to individuals as it 

44

relates to the very subject matter you are talking about right now. 

Obviously, Congress has not been particularly adept at dealing 

with some of these upcoming issues, and yet people working longer 

and saving more can be one of those things that actually can give 

us some breathing room and actually be productive for us. 

I would love to hear some specific policy measures—I know you 

all have talked about incentives—both to encourage people to stay 

longer in the workforce, but also to addressing the savings side, 

which, obviously—as I traveled around the State of Tennessee extensively over the last couple of years prior to being here, I have 

a tremendous fear that we are going to have not just a tsunami as 

it relates to the workforce issue, not just a tsunami as it relates 

to Social Security and Medicare within Government, but I just see 

so many people that are going to be devastated in later years because of a lack of understanding about saving for retirement and 

not having the funds in place. 

I would like to hear specific proposals that we here in the Senate 

might engage in to actually correct this. 

Mr. WALKER. Well, I have mentioned a few things already, but 

let me note that I think we have four serious deficits in America 

today. We have a budget deficit. We have a balance-of-payments 

deficit, of which the trade deficit is a subset. We have a savings 

deficit. We have a leadership deficit. 

Now, on the savings deficit, saving is critical to our future economic growth. It is critical to improving our standard of living over 

time. With savings, you get investment. With investment you get 

R&D. With R&D, you enhance productivity. With enhanced productivity, you can improve economic growth and you can improve our 

standard of living. 

We have dis-savings at the Federal level, because we are running 

large deficits, larger than advertised, because we are spending all 

the Social Security surplus. We have negative savings rates for individuals, and that is a matter of concern. 

I think Americans need to recognize the reality that Social Security, Medicare and Medicaid will be reformed, and that people will 

have to assume more personal responsibility for saving and investing and preserving those savings for retirement. 

Now, that is going to be for younger people more than, after, people who are already retired or are nearing retirement. You are 

going to see little to no changes, in all likelihood, for those individuals. But the people who are not retired or who are not approaching retirement age, are going to have to assume more personal responsibility. 

I think the other thing we have to recognize is we have a lot of 

tax incentives for saving. They result in a lot of foregone revenues. 

So we need to do a better job of analyzing, do they really increase 

the savings rate? Second, who benefits from those tax incentives? 

I think one of the things, quite frankly, that we are going to have 

to think about, possibly in conjunction with Social Security reform, 

is whether or not there base ought to be a mandatory savings on 

top of a reformed and defined benefit Social Security program, e.g., 

2 percent mandatory savings, payroll deduction, going into an individual account, into a real trust fund, with real fiduciary responsibilities, with limited investment options along the lines of the 

45

Federal thrift savings plan, that would provide a pre-retirement 

death benefit, that would help to fund for long-term care, that 

would help to link people to the markets and how investments 

work. 

So I think we are going to have to think outside the box, because 

I think our historical approaches, quite frankly, have not been very 

effective. 

Mr. KOHN. Senator, I think if I could build on one of the remarks 

Mr. Walker made about people coming to realize what they can and 

can’t count on in Social Security and Medicare, here is an example 

where, I think, the sooner we can act, the better. 

I think people have to see action by their elected representatives 

to address these problems, so they can see what they can and can’t 

count on in the future, so they can do the planning they need to 

do to have the savings, the flow of income, that they want to have 

in retirement. 

These are issues in which the longer we delay attacking them, 

the worse the issues get. That demographic imperative means that 

you are not going to really cut benefits or make major changes for 

people near retirement. You want to give people a warning. This 

would be only fair. The longer we wait, the more that tsunami, that 

upswing in that chart, comes into play, the fewer people that can 

be affected by these changes. 

So I think one of the really most important things that you could 

do as our elected representatives is to tackle these programs soon, 

so that people know and can plan on what they need to save. That 

would be No. 1. 

No. 2, I agree that you should be looking at the incentives to 

save in the tax system. We have moved into the direction, to some 

extent, of taxing returns from savings a little less than we used to. 

But this is one of the issues raised by the tax commission last year, 

and that is something that you should be looking at. I don’t know 

whether we are in the right place or not. That is really your decision. 

But I think that interaction of the tax system and savings would 

be another fruitful place to look, as well as some of the things that 

we were talking about before, whether Social Security, Medicare, 

ERISA regulations, pension regulations are, at least, not giving 

people the wrong signals about when they should retire. 

Senator CORKER. Mr. Chairman, thank you for this testimony. 

I hope that each of you will meet personally with me later on. 

We want to set something up. We follow very much what both of 

you do, and I just see human tragedy on the horizon. 

So many people are working for companies—you go, you talk to 

them in the lunchroom where they are working, and they say, ‘‘Oh, 

my company has a 401(k),’’ and you say, ‘‘Well, how much are you 

putting into it?’’ ‘‘Nothing.’’ 

I think that all of us together need to show leadership to cause 

people to really begin to act in a different way. I certainly realize 

that we in Congress have not shown much leadership as it relates 

to the financial issues that we are going to be dealing with down 

the road as it relates to Social Security and Medicare. 

I thank you, and I look forward to meeting with you personally. 

I appreciate it. 

46

The CHAIRMAN. Thank you, Senator Corker. 

Senator CASEY.

Senator CASEY. Mr. Chairman, thank you very much for putting 

this hearing together. It is a very important issue. 

I want to thank both of the members of this panel for your testimony today as well as your work and scholarship that goes into the 

testimony you provide today. 

I want to make one comment. Senator Corker and I are in our 

first year, and we know the benefit of seasoned workers. Our colleagues who have been here ahead of us give us the benefit of that 

every day. 

I come from a State where we have a higher percentage of those 

over 65 than virtually any other State, other than Florida. The last 

time I checked, it was about 15.6 percent over 65. The rest of the 

country around 12.4 percent or 12.5 percent, somewhere in that. 

So we have in Pennsylvania, I know, both the reality of that demographic and also, I think, the opportunity to be able to test ideas 

maybe before other States do. 

Certainly, seasoned workers—and, Mr. Walker, I am glad you 

gave us that terminology. It is important to use the right terminology. But I have no doubt that those workers play a vital role 

in the economy of Pennsylvania and the country. 

I think one of the important points both of you have made is that 

this isn’t just a good thing to do. That, in and of itself, would be 

helpful to younger workers to have the benefit of that experience 

that their colleagues provide. I think it would provide, if not an 

economic benefit, certainly an intangible benefit you really can’t define. 

But the point you have made is that making sure that we are 

providing incentives for seasoned workers to stay in the workforce 

longer is not just an economic benefit, but there is an economic imperative here. 

Mr. Walker, I was struck by your introduction in the GAO report, where you say in the first paragraph, ‘‘By 2025, the labor 

force growth is expected to be less than a fifth of what it is today. 

Without a major increase in productivity or higher than projected 

immigration, low labor force growth will ultimately lead to slower 

growth in the economy and slower growth in Federal revenues.’’ We 

can’t say that enough, and I am glad that both of you have highlighted that. 

Then, also, there was a CBO number which I am reading from 

some of the summaries of the testimony: ‘‘From today to 2017, CBO 

projects that slower labor force growth will slow average economic 

growth to 2.6 percent, compared to an average of 3.2 percent over 

the past 4 years.’’ 

All of that by way of background to highlight the imperative. I 

guess the question I have is very simple, and I invite both of you 

to weigh in on this. 

In terms of the strategies, the real basic strategies the U.S. Senate should deal with, whether it is changing the national mindset, 

whether it is changing the culture of retirement, whether it is financial literacy, the clearinghouse idea that is highlighted in the 

GAO report, legislation or regulation to increase flexibility from 

47

employers—of those strategies—because we know what the problem is, and we know what the imperative is. 

Of those strategies, what are the ones that you think are most 

effective and most likely to be the subject of action in the U.S. Senate? 

Because too often we talk about theories, but we need to move 

the ball down the field, so to speak, expeditiously. 

Of those strategies or others, what do you think are the most important, first? Second, what do you think are the most likely to 

have success in the U.S. Senate and the House? 

Mr. KOHN. Well, Senator, I would hate to choose. I would like to 

say all of the above and dodge the question in that way. But I do 

think that the problem is serious enough that we can’t afford to operate on some dimensions and not others. 

As you were talking, I was thinking about my own mother, who 

was a resident of Pennsylvania and who retired as a teacher and 

then went back to work part-time, using some of her teacher training, at the Philadelphia Museum of Art. She had a second career 

of 20 years after her retirement. She had the opportunity because 

it was part-time, the hours were flexible, and they used the skills 

that she had acquired as a teacher in the Pennsylvania school systems. 

So I think that, to a considerable extent, people, through their 

private initiatives, will do a lot to solve these problems. Businesses 

will see that their incentives are to make work available that people can do, to be flexible. Individuals will be incentivized by the 

fact that they are living longer and feeling better. They are capable 

of working. They get a lot of satisfaction, as I know my mother did 

out of her work experience. I think, to a large extent, this will be 

taken care of by the private market. 

But we need to be very certain that people in the private sector 

are educated to what is possible and what can be done. We have 

all worked in places that are reluctant to make changes because 

there could be costs to them. But if they can see that other firms 

have made changes to accommodate seasoned workers, that there 

haven’t been the costs that they might fear, I think that this would 

be very important. 

So it is information, it is policies. I just don’t think we can choose 

certain things. 

Senator CASEY. Thank you. 

Mr. WALKER. Senator, I believe that, ultimately, market forces 

will come together and they will force people to act. 

But we need to figure out what we can do to encourage people 

to act sooner rather than later, because this is a national imperative. This is not a want; this is a need. We need to do something 

here. 

Now, I would respectfully suggest that there are probably several 

categories. 

One category would be: What are some of the things that need 

to be done, that need to be done cooperatively, that might require 

public-private partnerships, not necessarily just involving the Federal Government, but also involving State and local Government 

public education, the clearinghouse idea, financial literacy efforts? 

What can be done at different ages to try to help in that regard? 

48

Second, let’s make sure the Government leads by example. The 

Federal Government is the largest employer in the United States. 

Let’s make sure that our Government policies and programs are 

such that we are actually leading by example here. 

Then, last, I would say that there are certain things that only 

the Federal Government can do. The Federal Government is going 

to have to reform Social Security, Medicare and Medicaid, sooner 

rather than later. The Federal Government is going to have to engage in comprehensive health-care reform, and it is going to have 

to engage in comprehensive tax reform, probably in installments 

over a number of years, but we need to get started. 

So there are certain things that we should encourage. There are 

certain things that we should do in partnership with others. There 

are certain things that we should lead by example as the largest 

employer in the country. There are certain things that only the 

Congress, in conjunction with the President, can do, and that has 

to deal with legislative actions. 

Senator CASEY. Thank you very much. 

The CHAIRMAN. Thank you very much, Senator Casey. 

Gentlemen, I cannot say how much we appreciate your being 

here today and giving us the benefit of your experience and your 

wisdom. It has made a big contribution to this hearing and to the 

whole effort that we are engaged in. So we thank you for coming 

here today. 

Mr. WALKER. Thanks. 

I would like to thank our staff. Our staff does a great job, and 

I just try to make sure I don’t let them down. 

The CHAIRMAN. Thank you. 

Mr. KOHN. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you. 

Now, we will turn to our second panel. 

Our first witness on the second panel is Dr. Marcie PittCatsouphes. She serves as director of the Center on Aging and 

Work, a unique research center at Boston College. She holds an 

MSP from Boston College and a Ph.D. from Boston University. She 

is here to describe the impact of the aging workforce on businesses 

and what they could do, but are not currently doing, to prevent a 

brain drain. 

The second witness will be Javon Bea, president and CEO of 

Mercy Health System. I am proud to say that Mercy Health System, based in Janesville, WI, is ranked the number-one employer 

for older workers by AARP, in part because of its flexible work 

schedules. 

Mr. Bea’s leadership and success in the business world is widely 

recognized, and I hope other companies will follow his example. He 

will discuss his company’s need for older workers, his policies for 

hiring and retaining older workers, as well as a need for other companies to adopt similar policies on a Nation-wide scale. 

We have a third witness from the State of Oregon, who Senator 

Smith will say a word about. 

Senator SMITH. Thank you, Mr. Chairman. 

It is my pleasure to again welcome Dr. Preston Pulliams. He is 

a great Oregonian, and he is also the district president of the Portland Community College. He will be discussing Portland CommuVerDate 0ct 09 2002 15:20 Jun 29, 2007 Jkt 000000 PO 00000 Frm 00052 Fmt 6633 Sfmt 6633 H:\DOCS\35956.TXT SAGING1 PsN: JOYCE
49

nity College as it is supporting older learners who want to remain 

in the workforce and partnering with businesses to assist them in 

retaining older workers. 

So thanks for coming, Preston. 

Mr. PULLIAMS. THANK YOU, SENATOR. 

The CHAIRMAN. Thank you. 

Ms. Pitt-Catsouphes. 

STATEMENT OF MARCIE PITT-CATSOUPHES, DIRECTOR, CENTER ON AGING AND WORK/WORKPLACE FLEXIBILITY, 

CHESTNUT HILL, MA 

Ms. PITT-CATSOUPHES. Good morning, Senator Kohl, Senator 

Smith and Members of the Special Committee on Aging. I certainly 

thank you for the opportunity to come and speak before you today. 

This morning, I would like to address four key points. 

First, as we have already discussed, the time really is right. 

Demographers have used the metaphor of the pig and the python 

to describe how the baby-boomer population group has changed the 

contour of virtually every societal institution. Today, the boomers 

have passed the midsection of that python. An average of 4.6 

adults will turn 65 each minute in 2007. By 2025, this will increase 

to an average of 8.0 adults per minute. 

The projections for the aging of the labor force are also dramatic, 

and these statistics compel us to pay attention. If you consider 

older workers to be those who are 45 years and older—and I want 

to emphasize that this is an age demarcation that is often used at 

the workplace—older workers comprise approximately 40 percent of 

today’s workforce. 

Labor economists anticipate a significant increase in the percentage of older workers over the next 5 years, a 48 percent increase 

in the number of workers aged 55 to 64 and a 40 percent increase 

in those 65 and older. 

There really are three basic sets of reasons why anywhere from 

two-thirds to three-quarters of older workers anticipate working 

into their 70’s. 

First, as we have discussed, our life spans have expanded, and 

most people report they enjoy relatively good health during their 

older years. This makes it possible for people to consider working 

longer. If older adults leave the labor force as early as 62, they 

could have two decades or more in retirement, and many boomers 

are telling us this is just too long for full-time retirement. 

Second, many boomers do not have sufficient savings, as we have 

discussed, for the 20 or more years of retirement. These boomers 

will face precarious financial situations if they retire completely, 

and a substantial number will, in fact, outlive their savings. This 

is the have-to reason. 

Third, a significant portion of boomers indicate they also want to 

work, because being employed offers many quality-of-life benefits. 

My second point is that flexible work options, indeed, are important. Although a majority of older workers expect to work past 

what has become our traditional retirement age, few of them, in 

fact, less than 10 percent, report they want to work on a full-time, 

full-year basis. 

50

Older workers are seeking flexible employment situations which 

includes opportunities, choice and control. These flexible work options can take many shapes, but they include options for different 

starting and quitting times, the number of hours worked, the number of months they work each year, provisions for entering and 

exiting, re-entering the workforce, and remote work. 

The access that older workers have to flexible work options may 

well be one of the most critical factors in their decisions about 

whether they can and they want to remain in the labor force. But 

here is the rub: Only a minority of U.S. workers has access to the 

flexible work options that they both want and need. 

My third point is that employers are not yet taking many steps 

to get ready for the aging of the workforce. Indeed, many employers 

are aware of the predictions about the anticipated labor force shortages, and they acknowledge the value that older workers already 

do add to the workplace. 

Let me first speak to the labor force shortages briefly. As we 

have discussed, many labor force economists feel that U.S. businesses, at least those in some industries and in some regions of the 

country, will face either workforce shortages in general or may not 

be able to find the talent they need for specific occupations. 

The second point is the one that is most compelling for employers, that, in fact, there may not be enough people to fill jobs in 

some professions which depend on experienced workers, and these 

could confront challenges if a majority of the boomers abruptly 

transition into full-time retirement. Specific industry sectors, such 

as health care, may be particularly vulnerable to occupational replacement needs. 

The second point here is the value of older workers. This past 

year, our Center on Aging and Work/Workplace Flexibility conducted a study to explore the perspectives of U.S. employers about 

the aging of the workforce, their readiness to respond, and including their adoption of a range of flexible work options. 

The first thing that is important is the employers reported positive attitudes about their own older workers, these they have already hired, particularly when compared to their assessments of 

young-adult employees and workers at mid-life. 

It is particularly important to note that the employers were likely to report that it is very true that older workers tend to bring 

attributes that can directly contribute to organizational success. 

These included their high level of skills compared to what is needed for the job, their professional networks, their client networks, 

and their desire to lead and to supervise. 

Despite these positive attitudes, however, only a small percentage of employers in our study seemed to be getting ready. For example, a fourth of the employers stated their organizations had not 

analyzed the demographics of their own workforces at all, and only 

a third of the employers reported that their organizations had 

made projections about the retirement rates of their own workers 

to a moderate or great extent. 

Over half of the employers say that they have made a strategic 

link between flexible work options and business effectiveness. Unfortunately, less than half of the employers say that they allow 

51

most or all of their full-time employees to access different forms of 

flexible work options. 

The fourth point is that employers are interested in information 

about promising practices. In closing, I would like to share with 

you just a couple of lessons I have learned about the ways employers pilot-test innovative practices. 

First, they want a strong business case for the innovation. Second, they want solid, research-based evidence about the probable 

outcomes of innovative practices. 

But as important as these first two steps are, they are rarely 

enough to spur employers into action. Business practitioners often 

want to see examples of innovative practice as implemented by 

other employers before they are willing to try the innovations at 

their own workplace. 

For this reason, this spring, our center is pilot-testing a 

benchmarking data base project for promising practices. We feel 

such a data base with rich information about the real-life experiences will help employers adjust to both the opportunities as well 

as the demands of our 21st-century world of work. 

Thank you very much. 

[The prepared statement of Ms. Pitt-Catsouphes follows:]

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The CHAIRMAN. Thank you very much. 

Mr. Bea. 

STATEMENT OF JAVON BEA, PRESIDENT AND CEO, MERCY 

HEALTH SYSTEM, JANESVILLE, WI 

Mr. BEA. Thank you, Chairman Kohl, Ranking Member Smith, 

Members of the Committee, for this opportunity to discuss the 

shortage that we see of health-care workers coming forth in our industry. 

Mercy Health System currently operates 63 facilities throughout 

southern Wisconsin and northern Illinois. We are based out of 

Janesville, WI. 

As Chairman Kohl mentioned, last fall, we were named as the 

number-one employer in the Nation by AARP for workers over 50. 

Currently, 28 percent of our workers are over the age of 50, and 

we expect this number to grow in the upcoming years. 

We actually started to analyze this problem about a decade ago—

the impending shortage of health-care workers. 

Just a couple of interesting statistics that isn’t in my written testimony that I came across is that we employ at Mercy hundreds of 

physicians, and by 2020, the number of physicians that are expected to retire each year is going to be greater than the number 

who graduated last year. 

In 2001, an American Hospital Association survey showed that 

75 percent, 75 percent, three-quarters, of the 168,000 vacancies in 

health care were nurses. That is a real—it is hard to run a hospital 

without nurses. 

So, basically, we decided some time ago that we needed to start 

to change our systems of scheduling. We started talking to our 

older workers, older physicians, nurses and said, ‘‘What do we need 

to do in order to keep you in the workforce longer?’’ It came back, 

as Marcie just stated, flexibility. They want more control over their 

time, their lives, to be able to pursue other things. 

So we developed a system that really provides flexibility in hours 

of the day, days of the week, seasons of the year, and location of 

work site. That way, we are able to recruit older workers but, more 

importantly I think, maintain workers that we have invested a 

great deal of time, money and training in through the years, who 

are still very healthy and have forgotten the idea that, ‘‘Boy, I am 

going to leave at age 55 so I can pursue some interest ‘‘or’’ I can 

spend winters with my husband in Florida.’’ What we have done, 

then, is make that possible for them to do it now and stay in the 

workforce. 

One of our most popular benefits is what we call our work-to-retire program, which allows employees over age 50 the opportunity 

to work reduced hours, pool hours, work at home, and still maintain all their benefits. 

In the work-to-retire program, if you are age 55 or over, you can 

work seasonally. So you work 1,000 a year at your discretion, and 

then you can still maintain full benefits throughout the entire year. 

So that allows individuals, as I said, to spend winters in Florida, 

to pursue other interests. Some people go on mission work. We just 

had some nurses go over and do some mission work in Kenya for 

6 months, came back to their jobs, and maintained full benefits. 

66

What we have done, also, in addition, is invest a great deal of 

resources in training programs in order to help even our nonskilled personnel to be able to adapt to new technology changes. 

We have invested heavily in mechanical assisted lifting devices 

at all of our hospitals that allow older nurses to be able to lift patients more easily using these mechanical assisted lift devices—

doing whatever we need to do to keep people, again, who are highly 

skilled, highly experienced, at a time in their lives where their children are raised, they do want to give back to society, they do want 

to keep working, but they just don’t want to be in that 8:00-to–5, 

Monday-through-Friday, daily grind all year long. 

So throughout the years, we basically have also found—and this 

is more of an intangible note—that we have less complaints, patient complaints, regarding the care provided by our older workers. 

Our data shows that our older workers, our older nurses, are simply, generally—there are always exceptions—kinder, more patient, 

gentler, and they relate. 

You have to be really sick to get into a hospital today. You are 

usually older, and I think the more mature worker can actually relate to many of our patients sometimes more than our younger 

workers. 

So as a consequence, our older workers serve as good mentors. 

They serve as good role models. We started to discover on the patient floors where we had older workers that we had better patient 

satisfaction, because they were having a positive influence in a 

mentoring role on our younger nurses. 

So as a business, we really think that we benefit, as well as our 

older workers benefit. Some of our folks, because they are highly 

skilled physicians, nurses, they tell us that they are at a point—

and with our retirement program, they are not so much working 

for the money.What they don’t want to do is have to work the Monday through Friday, 8 to 5, all-year grind. So they really want to 

continue to contribute to society. 

So we really believe that providing programs will help older 

workers stay in the workforce. It is a win-win for businesses, as 

well as the workers. 

I think what I would like to do is just thank you again for inviting me and then open up to any questions. 

[The prepared statement of Mr. Bea follows:]

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The CHAIRMAN. Thank you, Mr. Bea. 

Mr. Pulliams. 

STATEMENT OF PRESTON PULLIAMS, DISTRICT PRESIDENT, 

PORTLAND COMMUNITY COLLEGE, PORTLAND, OR 

Mr. PULLIAMS. Good morning to Chairman Kohl, Ranking Member Smith and Members of the Committee. I want to thank you for 

the opportunity to testify this morning and to talk about this subject of the aging workforce and its impact on business and economy, but also what the local community college can do in this situation. 

At Portland Community College, we are experiencing, in part, a 

trend or a national trend in terms of aging baby-boomers and preboomers returning to college or school, not simply for enrichment 

but also for re-training and re-careering. 

In a conference that we are hosting today back in Portland, OR, 

at the college, we are releasing the results of three studies that directly impact the subject that we are discussing today. 

The first is the Oregon Gray Matters, which is a study of the impact of the aging population on Oregon’s workforce. 

The second is the AARP employer poll on workers 50-plus, a survey of some 400 Oregonian employers to determine how they are 

preparing for anticipated work and labor shortages. 

No. 3, Boomers Go To College, which is a survey at the college, 

by the college, of students who are 40 years of age or older. We believe that this last report may be the first detailed picture of the 

needs and aspirations of baby-boomers as they enroll in college and 

other lifelong learning programs across this country. 

What we are learning from this work is that 43 percent of Oregon businesses report that they very likely will face a shortage of 

qualified skilled workers in the next 5 years. But nearly two-thirds 

of them have also noted that they have taken little or no action regarding these projected labor shortages. 

At the same time, approximately 80 percent of Oregon’s older 

workers are planning on working past traditional retirement years. 

Furthermore, four out of five older students enrolled at the college 

are not taking courses simply for personal enrichment but to upgrade their skills and re-enter the workforce or re-career. 

Given the right conditions and incentives to both older workers 

and employers, Oregon can count on this aging workforce to meet 

most of its projected workforce needs within the next decade. 

Whether Oregon capitalizes on this great potential will depend 

on whether the State can bring together the necessary range of 

business, civic, education, and Government actions and partnerships to overcome the barriers older workers experience in working 

longer. 

For example, we must work to overcome the misperception that 

many employers have about older workers. While a number of businesses surveyed indicate that tapping into the institutional knowledge of long-term employees is extremely important, many businesses believe that older workers are more costly to employ. 

However, AARP’s research finds that workers over 50 make up 

for any increase in health-care costs with low turnover and a reVerDate 0ct 09 2002 15:20 Jun 29, 2007 Jkt 000000 PO 00000 Frm 00073 Fmt 6633 Sfmt 6633 H:\DOCS\35956.TXT SAGING1 PsN: JOYCE
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sulting reduction in recruitment costs, training costs and loss of institutional knowledge. 

To maintain a competitive edge in a tightening labor market, employers need to help design a workplace that attracts and retains 

workers who are eligible to retire. This may include flexible work 

schedules, enhanced training opportunities and competitive benefits. 

To stay competitive in a changing labor market, older workers 

require skills training and education. However, few have the luxury to complete a 4-year degree or perhaps even a 2-year degree 

through traditional semesters and quarters. Juggling work, home, 

family and school obligations, older students are extremely motivated to complete their studies in a relatively short timeframe 

through alternative modalities, such as distance learning, to enable 

them to translate their education quickly into meaningful employment. 

Colleges can do much to support the older student by increasing 

flexibility in class scheduling and content, providing credit for prior 

work experience, expanding college counseling and advisement 

services to assist older students to successfully reach their goals, 

and developing internships and other workplace training programs 

in partnership with local employers in the community. 

At Portland Community College, we have developed several 

strategies to help older workers stay in the workforce. 

The first is the Older Worker Transitioning Program, where our 

college, in partnership with several businesses and nonprofits, have 

begun a program to help baby-boomers near retirement to plan for 

their future. The partnership, Work by Design Northwest, is built 

around three stages for its participants: discover, design and engagement. 

In discover, our participant explores his finances and health to 

set the stage for planning. In design, he uses the information to develop a life path. In engagement, they connect with educational institutions, such as our college or community organizations, to pursue new careers, volunteer opportunities and other interests. 

The second is a short-term skills training by the college Career 

Pathway Program, which has developed 17 professional technical 

offerings, most of which are appropriate for older workers who are 

no longer capable of working physically demanding jobs. They are 

delivered in a compressed schedule, so students can get back to the 

workforce quickly. 

These programs, which are eligible for WIA funding and support, 

are scheduled with the working adult in mind, organized in cohorts 

so students can provide support to each other, linked directly to 

high-demand occupations. 

The college has also developed processes to provide college credit 

for prior learning, as well as for work-based learning that employers might provide. Our objective is to make sure that all legitimate 

college-level learning is captured and leads to credentialing along 

the way. 

The third is helping business manage the aging boom. PCC’s departments are anticipating or working with businesses’ needs to 

manage impending boomer retirement, to customize service training programs for employers. The planning workshops also lead to 

71

customized services, such as multi-generational management, supervisory training, mentoring programs for older workers so they 

can transition, again, into less strenuous work. 

In closing, I would like to thank you again for an opportunity to 

testify this morning on behalf of the 1,200 community colleges 

across this country. I sincerely appreciate your interest and consideration in terms of the work we do in our institution in addressing 

this issue. 

Thank you very much. 

[The prepared statement of Mr. Pulliams follows:]

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The CHAIRMAN. Thank you, Mr. Pulliams. 

Senator Smith, would you like to ask some questions? 

Senator SMITH. Yes, thank you, Mr. Chairman. 

Preston, I was struck by a comment in a survey you did—that 

some businesses were fearful that to employ seniors or an aging 

population was more expensive. How big an obstacle is that? I 

think you cited AARP to show that that actually wasn’t the case. 

Mr. PULLIAMS. Yes. Again, in our surveys and in terms of our 

meetings, in terms of training programs with business and industry, that appears to be one of those barriers that we are trying to 

address. We are also sharing those studies around our district so 

that businesses will realize that that is, indeed, not the case. 

But, again, in our surveys, we are finding that that is one of 

those, I guess, stereotypical kinds of views about this particular 

part of the population, but it is, indeed, not the case. 

Senator SMITH. Do you think that businesses in Oregon have a 

sense of the labor issue and the resource that PCC is for them for 

finding qualified seniors who still want to work? 

Mr. PULLIAMS. Well, in terms of my experience there in the last 

3 years, when I arrived in this position, I have had now many conversations with local business and industry leaders, managers and 

CEOs, and they are becoming very aware of this problem. As a 

matter of fact, in my conversations with them, this tends to be the 

number-one issue now. 

So as I get more familiar with the business and industry leaders 

in the community, they are beginning now to call me. At first, I 

was trying to knock on their doors and get appointments with 

them. In the last year, this has been really an issue that they are 

contacting me and working very closely in terms of these programs. 

Senator SMITH. I was going to ask that. So you find a receptive 

audience and an improving audience in terms of employers in 

Oregon who are looking to you as a resource. 

Mr. PULLIAMS. I certainly do, Senator. Times are changing. 

Senator SMITH. What kinds of businesses are you finding most 

often that you are doing business with, who come to you? Is there 

a category? Is it high-technology? Is it food service? Can you categorize it at this point? 

Mr. PULLIAMS. Usually, in areas of high-skilled areas, particularly technology industries, recently a lot of contact with healthcare facilities, as was testified earlier by the gentleman to my 

right; also the construction industry, welding—those areas where 

you have the boomer generation now retiring and moving out of. 

Now employers are recognizing these potential shortages, and they 

are now contacting us. 

There is also an attraction for trained employees of color, because 

of our large enrollment of non-traditional and students of color in 

the community college sector. 

Senator SMITH. Do you find that businesses are responsive to 

what Mr. Bea indicated has helped Mercy, and that is having flextime schedules, so that they can get seniors if they can provide 

them the kind of work schedule that still lets them enjoy some aspects of retirement age? 

Mr. PULLIAMS. I am finding that also to be the case in the Portland area, particularly in a number of the large health-care sysVerDate 0ct 09 2002 15:20 Jun 29, 2007 Jkt 000000 PO 00000 Frm 00080 Fmt 6633 Sfmt 6633 H:\DOCS\35956.TXT SAGING1 PsN: JOYCE
77

tems in our district, the realization that we simply have to do business differently. 

I am also facing the same situation as a large employer in the 

area in terms of shared job responsibilities, flexible schedules and 

the willingness to be non-traditional in terms of how we look at 

employees from the past. 

Senator SMITH. Thank you very much, Preston. 

Mr. Chairman, it seems to me that businesses are going to learn 

the message ahead of time that they have to get creative in employment and how they schedule people, because the work pool is 

going to be older in the future. 

The CHAIRMAN. Thank you so much, Senator Smith. 

Marcie, Mr. Walker’s forum participants said that the Federal 

Government should help create new models of employment for 

older Americans through specific legislation, for example, offering 

employers tax credits as a way to motivate employers to hire older 

workers. 

I would assume you believe that we are not going to tackle this 

problem effectively without a panoply of Government legislation to 

change the culture. 

Ms. PITT-CATSOUPHES. When we talk to employers, we often help 

them think about the kinds of changes that they need to implement 

as kind of a four-step model, and I think this may help answer 

your question. 

The first huge hurdle we have to get across is awareness. You 

have heard several people testify this morning that although, on 

the one hand, employers understand the labor force is different and 

there may be occupational shortages, on the other hand, since it is 

not in front of them necessarily this year or this quarter, they may 

not be taking action steps. So I think that the first hurdle for us 

to get over is an issue of awareness. 

The second one that they always go through is an alignment with 

their key business strategies, and I will come back to that in a 

minute. 

The third thing, of course, is some kind of adaptive action, and 

we have talked a lot about flexible work options and what helps to 

stimulate and motivate them. 

The last piece of that is for them to assess their impact. 

I think strategies such as tax incentives are very, very helpful 

in the first two steps. It gets the attention of employers who might, 

in fact, not yet be paying attention. 

There are many employers—I am interested in terms of the projected retirement rates at Mercy. Last week I was at a conference 

of about 400 employers, and when we asked people what they expected in retirement rates, we were getting retirement rates of anywhere from a third to 60 percent. When you ask them what they 

are doing about it, very few of them indicate they are taking many 

steps. 

I think that, on the one hand, they have an awareness, but that 

awareness has not become so acute that they are doing anything. 

I think measures such as tax incentives get their attention. 

I think the second thing, when you talk about alignment with 

key business strategies, one of the first things, of course, that employers ask about is how that may impact some kind of a business 

78

case. Thought leadership is important, and, again, I think it gets 

their attention. 

The CHAIRMAN. Thank you. 

Javon, you seem to have been particularly effective in tailoring 

incentives for people to stay on in the particular business that you 

are operating. Is it true that there are general things, but there are 

also particular things a business can do, depending upon the business that they are in? 

Mr. BEA. Yes, definitely, Chairman Kohl. I think that what we 

have found is that turnover is expensive, you know, recruiting, 

training new people. So, the longer that we can keep our workers 

that are skilled—and unskilled even—in the workforce, we think 

that the resources that we expend, the expenses that we incur to 

keep our older workers in the workforce is offset by the savings 

that we have through longer retention. 

One other key statistic is that one-third of the current Nation’s 

750,000 physicians that are post-residency physicians are over age 

55 and are projected to be retiring when the baby-boom generation 

is at the time of their greatest medical need. 

So, as Marcie alluded earlier, health care is especially facing a 

growing labor shortage of both skilled and unskilled workers, and 

we just decided that we needed to start now at putting in programs. 

Really, what it took was the commitment, the desire, to change 

our scheduling mechanisms, to change our way of doing business, 

to adapt to people who wanted to be able to take a season of the 

year off or work certain days or take an extended vacation. We felt 

that that was wiser on our part to do than just to find ourselves 

in shortages. 

Many hospitals today are closing units, entire nursing units, because they have nursing shortages. As I mentioned earlier, 75 percent of all the health-care worker shortage, 168,000, are nurses. 

So we realized, with 63 facilities, that we needed to begin taking 

measures now, not to speak of the fact that we felt since the senior 

senator from Wisconsin is Chairman of the Committee on Aging, 

we had better step it up a notch, too, you know. [Laughter.] 

The CHAIRMAN. Thanks a lot. 

Preston, any comments you wish to make about this paradox, 

that while so many companies do realize that they are going to face 

a shortage of qualified workers, so few of them seem to be responding in a way that anticipates the problem that they are going to 

be facing in just a few short years? What are your thoughts about 

this paradox? 

Mr. PULLIAMS. What I am seeing in terms of our area in Portland, OR, is that they are really quickly beginning to realize that 

there is not a pipeline of younger workers or trained workers to fill 

those who exit in retirement and whatever. As that hits them, that 

is when they call my office and want to know what can the community college do. 

Also, there seems to be an increase in terms of partnerships now, 

in terms of business and industry being willing to work with us at 

the community college, in terms of joint programs, where they can 

work with us to help recruit perhaps skilled workers or to help 

counsel those who are retiring to perhaps come back as a part-time 

79

worker in the same industry. So it is changing, as was reported 

earlier by the first panel. 

The numbers are really revealing the shortage, and people are 

really grabbing onto this reality, and they are getting quite creative 

in terms of how they are addressing this. But it continues to be a 

struggle in terms of people being aware and of what they can do 

and how they can react. 

The CHAIRMAN. Thank you very much, Preston. 

Senator CASEY.

Senator CASEY. Mr. Chairman, thank you very much again for 

our second panel here and this great information. 

One organizing or unifying subject in all of your testimony, one 

way or the other, that I have noticed is health care. I want to focus 

on that for a couple of moments. 

Doctor, I appreciate the work that you have done at Boston College, and I say that as a graduate of Holy Cross, long time ago rivals. But your school passed us a long time ago, so we are not even 

in the same league, athletically. I hope we are in the same league, 

academically. 

But, in particular, when you were trying to summarize your testimony—and I know you read or summarized this part of it, and 

I am not sure what page this is, but you said, ‘‘Specific industry 

sectors such as health care may be particularly vulnerable to labor 

force replacement needs anticipated for specific occupations.’’ Then 

you had examples, which I don’t think you got to because of the 

limited time. 

Your paper says, ‘‘Ten of the 20 fastest growing occupations are 

concentrated in health services. These positions include medical assistants, 59 percent growth; physicians’ assistants, 49 percent 

growth; home health aides, 48 percent growth; medical records and 

health information technicians, 47 percent growth.’’ I am struck by 

that, because in our State—as I mentioned before, Pennsylvania 

has the second-highest population over 65. Our fastest-growing 

population, literally, is 85 and up. I know that Wisconsin and Oregon and other States are facing similar challenges. 

But in my work in State Government, we spent a good deal of 

time on long-term care issues and, in particular, this real urgent 

need for health-care workers, from the lower-skilled positions to 

the higher-skilled positions. 

I really believe that people that do this work are not only essential for our future in terms of the services they provide and the 

skilled care they provide, but I think they provide a kind of ministry that is so critical to the fabric of America. 

I know from my own experience—my father was in a hospital, 

several, in the last months of his life—last couple of years, actually, 

of his life. I knew that even what is considered a low-skilled worker 

in the scheme of skills or the range of skills—a nursing assistant 

who comes in to a bed and takes someone who, in his case, could 

not move from one side to the other, had to have the pad underneath his body folded the right way, and the tiniest little person 

could do that because she had skill. I remember my family, that 

might have been bigger than she was, couldn’t do it because we 

didn’t have that skill. So I reflect upon that in a very personal way. 

80

Tell us more about that, though, the urgency of making sure that 

those health-care jobs are filled and how grave the challenge is. 

Ms. PITT-CATSOUPHES. Well, thank you, Senator. I appreciate the 

question. 

The health-care industry is important for us to look at for several 

reasons. When we anticipate or look at the projections around labor 

force shortages or, specifically, occupational replacement needs, the 

health-care industry is fascinating, in part because of course it is 

such a critical need for our country, as you pointed out. 

The second thing, which we have been focused on today, is that 

it happens to be one of those industries with several occupations 

that are so-called ‘‘aging out.’’ The third thing, which is equally interesting, and this has been for a while in certain health-care occupations, is that they have had to think of very creative ways of attracting new and, in many cases, younger workers into the socalled pipeline. So, in that sense, they have more experience than 

a lot of other industries. 

When you have this kind of double-whammy effect, you have an 

aging workforce on the one hand, but you have occupations that 

may not be attracting as many younger workers, so, as a consequence, all those things are happening. 

But the health-care industry is also interesting, because, of 

course, the aging of our population means there is going to be a 

higher demand. 

So, when you have all of those factors simultaneously, that, in 

fact, is one of the reasons, in addition to some good thought leadership, that the health-care industry is out front in this arena. 

Our conversations with employers would suggest that there are 

other industries that are also in similar situations but, of course, 

different occupations: for example, retail. If you look at the anticipated expansion of that, they have similar pressures as health 

care. 

You know, much like my colleague just commented on, retailers 

are also beginning to say that they are finding that customer service relations, in fact, can be improved when the experienced workers not only are dealing directly with customers but sort of modeling very positive behavior for their younger colleagues. 

So I think that you are exactly right, that although the conversations understandably turn to industry sector, that, really, where 

the pinch is felt, and that is where employers are paying a lot of 

attention, is in specific occupations. 

Thank you. 

Senator CASEY. Thank you. 

I have to run, but I do want to say to both of your colleagues that 

the work that you are doing in the context of a community college 

and in the context of a health-care facility and institution is critically important. We appreciate that. We appreciate the fact that we 

can find and identify models that are working. 

I want to see how we are doing in Pennsylvania in the context 

of both of your contributions. But we appreciate the good examples 

you provide. 

Mr. PULLIAMS. Thank you, sir. 

Mr. BEA. Thank you. 

The CHAIRMAN. Thank you so much, Senator Casey. 

81

In bringing this hearing to a conclusion, I think between yourselves, the three of you, and the two people who testified before 

you, plus the questions and the responses that we got, there is a 

keen, keen awareness of the problem that we are facing. 

There are a multiplicity of recommendations that have been 

made today that probably would give us a tremendous ability to 

impact this whole problem we are facing successfully, just on the 

basis of what we have heard today, what we have said today and 

the things that we have discussed today. 

Of course, the problem, the difficulty, the challenge is to get the 

things we have discussed out there in policy, in position, in taxes, 

in reform, in legislation—not an unawareness of the problem or not 

an unawareness of what needs to be done, but getting it done. I 

mean, that is really what we are facing. 

I think what you have brought here by way of your experience, 

your thoughts and your recommendations really adds an awful lot 

to our understanding of the problem that we face, to its importance 

and to the solutions that we need to seek and find and put in place. 

So I thank you. We all thank you for journeying here to Washington today and for testifying in front of this Committee, and you 

have made a real contribution. 

With that, the hearing is closed. 

[Whereupon, at 12:05 p.m., the Committee was adjourned.] 

(83)

A P P E N D I X 

PREPARED STATEMENT OF SENATOR LARRY E. CRAIG

Chairman Kohl, I want to thank you for holding a hearing on this important 

topic. I know you are well aware of the enormous changes the retirement of the 

baby boom generation will have on our nation. 

We face several challenges when it comes to responding to our Aging workforce 

in a manner that is beneficial and practical for both baby boomers and the business 

community. Some of these challenges include concerns about the costs of retaining 

older workers or negative stereotypes about older Americans. Fortunately, implementing policies that will benefit Aging workers and benefit businesses are not mutually exclusive. 

As many of the witnesses today have noted, there are numerous reasons why 

older workers will benefit from staying in the workforce past traditional retirement 

age. I wanted to take a moment to highlight the fact that many older workers remain in the workforce, not simply because of financial concerns, but for their overall 

health. Several studies have shown that having a social network and being intellectually challenged are incredibly beneficial for the mental and physical health of 

older Americans. The statistics indicate that that more Americans are beginning to 

realize that. In the past 10 years, the percentage of men and women aged 62 and 

older who are paid employees has increased. 

However, this message has not reached all Americans who are facing retirement. 

While we should not try to force individuals to stay in the workforce, it is important 

that work place options are available to allow older Americans to reap the benefits 

of remaining in the workforce. 

Fortunately, businesses will also benefit from retaining older workers. Older 

workers provide invaluable institutional knowledge and save businesses on recruitment and training costs. There are negative perceptions out there about older workers, but some companies are already proving that older workers have a lot to offer. 

I am pleased that Javon Bea of Mercy Health System is here today to talk about 

their experience with older workers. If I may, I would like to point out what I feel 

is a particularly significant observation that Javon Bea made in his testimony. He 

noted that the older older workers in the Mercy Health System are ‘‘no longer working as much for the money as they are working to make a contribution to society.’’ 

This is yet another compelling argument for older workers. It is an opportunity to 

have employees who are personally invested in the work they are doing. 

Mercy Health System has provided an excellent example of how businesses, and 

older Americans, can benefit from remaining in the workforce. Now our goal has to 

be to encourage other businesses to follow Mercy’s example. 

Finally, I just want to say that I am proud to join Senators Kohl and Lincoln in 

cosponsoring the Older Worker Opportunity Act. This bill will provide tax incentives 

for businesses to create flexible work programs in order to retain older workers. I 

am confident that these kind of incentives will go a long way in reducing the negative impact that retiring workers will have on our nation’s economy. Given our 

evolving workforce and economy we must continue to reexamine our definition of retirement. Even the United State Senate, where the average age of a Senator is 60, 

can provide an example of Americans working past retirement age. 

Again, Chairman Kohl, thank you for calling this hearing and I look forward to 

hearing from our witnesses.

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