65 Speed Limit

With the economy’s ill health continuing and their own personal health improving, America’s senior citizens are not retiring like they used to. In fact, more of them are working every day.

Since the late 1980s, the labor force has seen the participation rate of those aged 65 and older increase by nearly 50 percent, and the rate for workers aged 55 to 64 has increased even more— from 55 percent to 65 percent.

Number crunchers tell us this trend is likely to continue. Actuaries at the National Council on Compensation Insurance (NCCI) say it’s more than the economy that’s keeping seniors in the workforce. They say changes in Social Security as well as improved health, a decline in physically demanding jobs and longer life expectancy are also at play.

Younger workers might not be pleased by this news. After all, the more seniors stay on the job, the fewer openings and opportunities for them. This could have ramifications for the insurance industry, where many think there are already too few younger people. But let’s not blame the seniors who are staying on the job now —the industry has long lagged in attracting young talent.

While young insurance professionals may have mixed feelings, for workers’ compensation underwriters and claims adjusters—young or old—the fact that more seniors are sticking around at worksites and in offices could be good news.

That’s because workers who have been around for 65 years and longer tend to have lower indemnity costs than do younger workers, largely because of their lower weekly wages.

A report by the National Council on Compensation Insurance (NCCI) found that the average weekly wage tends to increase with the age of the worker until it maxes out when a worker hits early 50s. It then gradually falls until age 64, when it then plummets by as much as 30 percent for workers 65 and older.

NCCI also found that indemnity severity increases steadily with age through age group 45-49 and then flattens through age 64, after which it declines by roughly 20 percent. All told, indemnity severity for workers 65 and older is roughly four percent less than that for workers of all ages, according to NCCI.

Seniors on the job may slip and fall more than others but that is rare and if and when they do get hurt, their injuries can be more serious than those of younger workers, although not by as much as you might think.

Bottom line, here we have an army of trained, responsible workers who cost less in wages than their younger peers and won’t blow a hole in the workers’ compensation budget either.

Years ago The Beatles, when they were still young, asked the musical question:

Will you still need me, Will you still feed me, When I’m 64?

The answer is that many 64-year olds — and those older– don’t need to be taken care of by others. They can not only feed themselves, but they can also still put the food on the table.