New Retirement Gap Is Blue- And White-Collar

By Adam Belz, Star Tribune (Minneapolis)

May 12--Ken Bueckers loved being a pipe fitter. It took him to the tops of tall buildings and to furnaces below. He yanked valves open and wrestled pipe into crawl spaces.

In a perfect world he would still be doing that. He's 69, but he has a clear mind and 32 years of experience. He and his wife could use the extra income. "I would probably go out and do it if my body would let me," he said.

At a time when financial necessity is forcing many Americans to work longer, some don't have that option. Bueckers is one of millions of blue-collar workers who have grown too old for blue-collar work.

White-collar professionals like consultants, lawyers and accountants are often able to retire gradually, finding ways to keep earning money in fields where they have connections and skills. Almost two-thirds of Americans between 45 and 60 say they plan to delay retirement, according to the Conference Board research group, thanks in large part to a recession that ripped into retirement accounts and home values.

But workers in physically demanding jobs are less likely to keep working, and more likely to enroll early for Social Security, according to the AARP. For most blue-collar workers -- pipe fitters, oil workers, roofers and many factory workers -- the options are to shift to what will likely be lower-paying work, or to stop working at all.

It's pretty clear, if you're a blue-collar worker and you're physically unable to work, you don't have as many options as a white-collar worker," said Steve Vernon, a scholar at the Stanford Center on Longevity. "That is a problem, and there are no easy answers."

Tom Fossum, 60, of Minneapolis, was a concrete laborer for 32 years.

He poured concrete at the Mall of America and for high-rises in the Twin Cities.

But as he got older, the lifting, bending and kneeling hurt his back and then his knees. Now he has two knee replacements.

"They basically retired me at age 54, because I couldn't do my job anymore," Fossum said. "I'd love to do concrete again, but it just ain't happening."

His pension through Laborers Local 563 is about two-thirds what it would be if he'd been able to work until 62. And it's not just the money that's missing.

"You get out every day, and meet friends and you work all day," Fossum said. "Time goes by fast."

In 2012, more than 500,000 Minnesotans worked in what can be reasonably considered a blue-collar industry, like manufacturing, warehousing, construction, transportation, logging or mining, according to census data.

Even by that narrow definition -- not including blue-collar jobs in government, education and health care -- roughly 228,000 blue-collar workers in the state are between 45 and 64 years old.

"Roofers are probably not going to continue roofing after they retire," said Tom Gillaspy, the semiretired former state demographer. "Statisticians may very well continue to work after they retire."

On the job at 75

Herb Schechter worked until he was 66 at the accounting firm he helped found, Schechter Dokken Kanter, and retired in 2004.

For a year he did nonprofit work, golfed occasionally and helped some elderly poor with tax returns.

But after tax day in 2005, he had a pivotal midweek realization. "I really had no desire to play golf every day, and further, I had no desire to sit and play gin rummy with a bunch of guys in the afternoon," Schechter said.

He slept on it, and the next day called a former client at Minneapolis Portfolio Management Group, Phil Grodnick, who said they'd be glad to have him.

They're numbers guys, and thinkers, and so is Schechter. Plus, he knows a lot of people after running one of the top accounting firms in the Twin Cities.

At 75, he loves the ritual of going to the office. He wears a tie, drives from Minnetonka to the IDS Center and rides the elevator to the 19th floor.

He calls around, reads, analyzes company balance sheets, holds forth on the economic importance of Chinese and South African eating habits, or the demand for fertilizer in Brazil.

Instead of 60-hour weeks he works 40, and the buck stops on someone else's desk. It almost feels like vacation, and he has no plans to quit.

"What I'm doing is really an intellectual pursuit," Schechter said. "I'm in good health, but I wouldn't be able to work on an assembly line today."

Retirement trends

Delayed retirement is a recent historical phenomenon.

In 1880, as many as 80 percent of men age 65 and older were still working. But incomes rose in the 20th century, giving people the freedom to retire earlier, according to "Early Retirement: The Dawn of a New Era?" a 2011 paper written by Joseph Quinn and Kevin Cahill at Boston College, and Michael Giandrea from the U.S. Bureau of Labor Statistics.

Social Security and defined-benefit employer pension plans grew in prominence after World War II and provided predictable income for retirees.

Also, up to half of workers were forced to quit their job at age 65 in the 1970s, and pension plans included subtle calculations that penalized workers who stayed on longer.

By 1985, only 16 percent of men 65 and older were working.

Ever since, the pendulum has been swinging back.

Congress outlawed mandatory retirement in 1986 for most workers, and Social Security benefit calculations were changed to make retirement and delayed retirement equally beneficial, the paper's authors explained.

Defined-contribution plans like 401(k)s began to replace pensions.

Older Americans grew healthier than previous generations, and lots of jobs became less physically demanding. Then the recession hit, popped the housing bubble, triggered millions of job losses and forced many older workers to raid their retirement accounts. So they decided to keep working.

The Conference Board says that between 2010 and 2012, the percentage of people 45 to 60 who planned to delay retirement rose from 42 percent to 62 percent, mostly because of depleted savings and home values.

Some retirees have tried to go back to work, and retirement has evolved into a more gradual process.

But the skills of a bricklayer don't transfer into old age because the job is too physical.

"The blue-collar, highly skilled crowd, they're the ones who are most likely to go from their careers to directly out of the labor force," said Kevin Cahill, an economist at the Sloan Center on Aging at Boston College.

"There's this big percentage of the population that's counting on retiring at 62."

Demanding work

Donna Alexander is still working at 67, and she tries to stay cheerful about it.

She's on her feet throughout the day as a security officer in a downtown office building, where she works weekends and three weekday second shifts. She's been doing the job for 11 years.

"The constant pounding on your feet and knees, that exacerbates the arthritis," she said.

In June she will have reconstructive surgery on one of her feet, she said. The other foot has already been repaired, and both her knees have been replaced.

She can't quit yet because she doesn't have enough money for retirement, and because she needs the job's health insurance coverage to pay to repair the damage the job helps cause.

While she would miss the exercise, the chances to talk to new people, and the paycheck, she knows her days in that work are numbered.

"Each surgery takes a little bit longer to heal from," she said.

Bueckers' job ushered him into retirement from Pipe Fitters Local 539 at age 56.

He carried lengths of pipe, climbed ladders and crouched a lot. Steampipe joints could be closed so tight that not even cranking on a 24-inch pipe wrench would pop them loose.

Bueckers remembers throwing a 5-foot pipe over wrenches for extra leverage.

"We had some pipe wrenches where the steel handles were actually bent -- that's how tight some of these joints were," Bueckers, 69, said.

His back first blew in 1984. He took five weeks off. It blew again in 1990, and again in 1995, leaving him frozen in pain on the floor for an hour, he said. He quit in 2000, at his doctor's insistence. His case was extreme, but in the sense that his body gave out before he turned 60, not unusual for a pipe fitter.

Now he stretches in the mornings at his home in Brooklyn Center.

He exercises at the YMCA, reads the paper and fiddles with the computer. He volunteers at church, organizes blood drives and troubleshoots the church's HVAC system.

Now and then he might gingerly play a round of golf. He can't mow the lawn, so his wife, Jean, does it.

"When we get to our 60s, our bodies are pretty well worn out," Bueckers said.

Adam Belz --612-673-4405 --Twitter: @adambelz

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