Tag Archives for Kathleen Connell

Report: Hiring Older Workers Makes Good Business Sense

Published in Woonsocket Call on May 4, 2015

Here’s a sound strategy for America’s CEOs to follow to improve their corporation’s bottom line. AARP’s recently released study suggests, just hire or retain older workers.

An AARP study, released on April 27, discredits widespread myths and misconceptions about age 50+ employees, showing that they have skills and abilities that can make them key to operating a successful business. The report, “A Business Case for Workers Age 50+: A Look at the Value of Experience 2015,” says that the argument for employing older employees has grown even stronger during the last decade, reinforcing a 2005 AARP study that found that these experienced workers are highly motivated, productive and even cost-effective.

Researchers claim that this study documents for the “first time why attracting and retaining experienced age 50+ workers is critical for businesses seeking an advantage in the labor market.”

Older Workers Sound Investment

“Leading employers across all industries value the expertise and experience of workers 50+ and know that recruiting, retaining and engaging them will improve their business results,” said AARP CEO Jo Ann Jenkins in her statement on the releasing the 92 page report.

Just as today’s 50+ population is disrupting aging and eroding negative stereotypes, today’s 50+ workforce is adding value by exhibiting traits that are highly sought after in today’s economy,” Jenkins added.

Adds Roselyn Feinsod, senior partner at Aon Hewitt, a multinational company providing human resources, retirement and health solutions, that prepared this report, “Workers age 50+ are highly valuable within many organizations – particularly in those industries that require highly skilled workers or workers with unique skill sets, such as health care or energy.”

Researchers say that the AARP report comes at a time when experienced workers are playing an increasing role in America’s workplace. In 2002, workers age 50+ made up only 24.6 percent of the workforce. By 2012, they were 32.3 percent. By 2022, they are projected to represent 35.4 percent of the nation’s total workforce.

The AARP new study addresses a widespread misconception that older workers cost “significantly more” than younger workers. In fact, adding more talented older employees to your workforce can result in only minimal labor cost increases, says the researchers, noting that 90 percent of large employers now base pay in part on job performance, rather than exclusively on length of employment.

In addition, in terms of retirement costs, only 22 percent of large companies now offer a defined benefit pension plan, down significantly from the 68 percent in 2004.
Looking at the 50+ segment of the workforce from a performance standpoint, AARP and Aon Hewitt say that older workers remain the most engaged age group. The study reports that 65 percent of workers age 55+ are considered “engaged”, based on survey data, while younger employee engagement averages 58 to 60 percent.

Although the generational differences in engagement might not seem large, “it takes only a five percent increase in engagement to achieve three percent incremental revenue growth,” the report finds. This can translate into a large company with $5 billion in revenue achieving a $150 million revenue increase as a result of even a five percent engagement improvement, the study says.

The report concludes “An engaged older workforce can influence and enhance organizational productivity and generate improved business outcomes.” Other advantages of older workers include their job experience, professionalism, strong work ethic, lower turnover, and knowledge.
AARP commissioned the study to assess the advantages of both retaining and attracting older workers. The analysis relies primarily on data from Aon Hewitt databases, an extensive literature review and interviews with 18 large employers to obtain anecdotal information on how they approach older workers.

Contributing to Rhode Island’s Economy

“We have noted in the past the relevance of Rhode Island’s so-called Longevity Economy,” said AARP Rhode Island State Director Kathleen Connell. “Despite being just 36% of Rhode Island’s population in 2013 (expected to grow to 38% by 2040), the total economic contribution of the state’s 50-plus population accounted for 46% of Rhode Island’s GDP ($24 billion). Now we see another reason to embrace the older population.

Connell notes that “This new report reinforces the value of older Rhode Islanders as they continue to be a key asset in the workforce. It is especially good to have reliable data that exposes the false concept that older workers cost significantly more than younger workers. The truth is, that older workers increase labor costs minimally while contributing experience and stability to businesses across the spectrum.

“Many employers in Rhode Island understand this. AARP Rhode Island gets frequent calls from business actively seeking older workers. They know the value and the wisdom they bring to the workplace,” says Connell.

According to Charles Fogarty, Director of the Division of Elderly Affairs (DEA), the recently released AARP study helps his agency spread this message, “older workers are expected to play a key role in sparking Rhode Island’s comeback.”

“We support policies and programs to help this crucial segment remain active in the labor force by connecting older workers to services and training,” says Fogarty, noting that AARP’s study confirms, “our seniors are a valuable asset in our workforce given their wealth of knowledge, ability to mentor younger colleagues, and commitment to hard work.”

Deputy Director Lisa D’Agostino, of the state’s Department of Labor and Training agrees with DEA’s Fogarty. “Age 50+ workers are a talented segment of our workforce that is often overlooked and untapped when businesses seek workforce solutions. Given today’s demand for a skilled workforce the solution is simple – mature workers can bring the talent, leadership and work ethic employers need,” she says, noting that labor force participation for this group is on the rise and unemployment rates are lower than that of the prime working age population and have been for the last ten years.

Oak Hill resident Hank Rosenthal, 64, confirms the importance and value of hiring older workers. But, during his two-year job search, after being laid off, he experienced job discrimination, he claims. “Having been interviewed by numerous Human Resource professionals, they just seem incapable of understanding that the years of experience someone has gained is an asset. They seem unable to appreciate that knowledge, experience, and even skills acquired over a lifetime can be transferred and used in virtually any organization or business,” he says.

Rosenthal, now gainfully employed, views his older contemporaries as being “more stable, reliable, have better work ethics and generally make great employees, in line with the observations of the AARP report. With the difficulty in finding employment he believes that companies have not figured this out yet. “What a terrible waste of human capital,” he says.

While older workers may be forced to continuing working to pay their bills, many employees will take jobs for both psychological and social fulfillment. Hiring and retaining older workers may be a simple way for American businesses to maintain their competitiveness in a world economy. The report says that this can easily be accomplished by having “flexible workplaces, options for transitioning to retirement and fostering generational diversity and inclusion.” The AARP report is a must read for any CEO or Human Resource Director.

For the full report, go to http://www.aarp.org/research/topics/economics/info-2015/business-case-older-workers.html.

Herb Weiss, LRI ’12, is a Pawtucket-based writer who covers aging, health care and medical issues. He can be reached at hweissri@aol.com.

Rethinking Rhode Island’s LTC Delivery System

Published in the Woonsocket Call on April 12, 2015

AARP Rhode Island releases a state-specific analysis, of the 2014 edition of “Raising Expectations: A State Scorecard on Long-Term Services and Supports (LTSS) for Older Adults, People with Physical Disabilities, and Family Caregivers” that just might give state officials cause for concern, a low rating on its long-term care delivery system, when compared to other states.

The 2011 Scorecard was the first multidimensional assessment of state performance of LTSS. Like this earlier version, the release of the 109 page 2014 report, referred to as the LTSS Scorecard, and its state-specific analysis (prepared by policy consultant Maureen Maigret), measuring how well the nation and each of the states is doing in providing long-term care services, does not bode well for the nation’s littlest state. It finds the Ocean State ranks 38th nationally on 26 performance indicators, with it achieving the lowest rank of all New England States.

“Our analysis provides a closer look at where Rhode Island is keeping pace and where we fall short,” said AARP State Director Kathleen Connell. “The report indicates that, as the state with the highest percentage of persons 85 and older, we face exceptional challenges. It is our hope that the General Assembly and state policymakers find the analysis to be a valuable tool,” she says.

Failing Grades

The 2014 LTTS Scorecard indicates that Rhode Island:

• Ranks 4th highest among states in nursing home residents per 1,000 persons age 65 and over

• Has a high percent of low-care nursing home residents and spends a far higher percent of its LTSS dollars than the national average on nursing home care as opposed to home and community-based services.

• Has some of the highest long-term care cost burdens in the country making private pay long-term services unaffordable for the vast majority of older households.
But, on a positive note, the state-specific analysis noted that Rhode Island’s best progress was made in the Legal and System Supports dimension largely due to the 2013 passage of the Temporary Caregiver Insurance program and Caregiver Assessment requirements for Medicaid Home and Community Based Services (HCBS).

In addition, to revisiting the 19 recommendations made following the release of AARP’s 2011 Scorecard, the more recent 2014 analysis recommends five new major policy initiates to improve the littlest state’s LTSS. Among the recommendations: funding of an Aging and Disability Resource Center; the developing an online benefits screening tool to allow access to income-assistance benefits and conducting outreach programs to increase participation; reviewing the Rhode Island’s Nurse Practice Act to allow nurse delegation of certain health maintenance and nursing tasks to direct care workers; requiring hospitals to provide education and instruction to family caregivers regarding nursing care needs when a patient is being discharged; and exploring emerging medical technologies to better serve home and community based clients.

The current analysis finds that only four recommendations out of the 2011 recommendations have been implemented, most notably those to promote coordination of primary, acute and long-term care and to strengthen family caregiver supports.

Meanwhile, only six recommendations were partially implemented, including the expansion of the home and community co-pay program and authority (but not implementation) under the 1115 Medicaid waiver renewal to provide expedited eligibility for Medicaid HCBS and for a limited increase in the monthly maintenance allowance for persons on Medicaid HCBS who transition out of nursing homes. Finally, nine recommendations, although still relevant, have not been implemented.

Response and Comments

Responding to the release of AARP’s 2014 Scorecard and state-wide analysis, Governor Gina Raimondo says, “we need to ensure that we have a strong system of nursing home care for those who truly need those services, but we must invest our Medicaid dollars more wisely to support better outcomes. We cannot continue to have the fourth highest costs for nursing home care (as a percent of median income of older households) and also rank near the bottom of all states in investments in home and community-based care.”

According to Raimondo, the state’s Working Group to Reinvent Medicaid is looking closely at AARP’s Scorecard and state-specific analysis and Rhode Island’s spending on nursing home and long-term care. Health & Human Services Secretary Elizabeth Roberts has directed her staff to look directly at the proposals recommended by AARP Rhode Island.

“I expect the Working Group will include specific proposals stemming from these findings in their April budget recommendations and their long-term strategic report they will complete in July,” says the Governor.

AARP Rhode Island Executive Director Connell, representing over 130,000 Rhode Island members, was not at all surprised by the findings of the recently released 2014 Scorecard. “Based on benchmarks set in the 2011 Scorecard, it was apparent that there was much work to do,” she says, recognizing that there are “limited quick fixes.”

“Some steps in the right direction will not lead to an immediate shift in the data. This is a big ship we’re trying to steer on a better course. We were encouraged, however, by ‘improving’ grades for lower home-care costs and the percentage of adults with disabilities ‘usually or always’ getting needed support rising from 64 percent to 73 percent,” adds Connell.

Connell says that the Rhode Island General Assembly is considering legislation to improve the delivery of care, which might just improve the state’s future AARP ‘report’ cards.” “In this session, there is an opportunity to improve long-term supports and services with passage of several bills, including one that would provide population-based funding for senior centers,” she says, stressing that it’s a “responsible investment that will help cities and towns provide better services.”

Connell adds, “The proposed CARE Act gives caregivers better instruction and guidance when patients are discharged and returned to their homes. This can be a cost saver because it can reduce the number of patients returned for treatment or care.”

The larger mission for state leaders is the so-called ‘re-balancing’ of costs from nursing care to home to community-based care. That’s where real savings can occur and home is where most people would prefer to be anyway.”

Finally, Virginia Burke, Executive Director of the Rhode Island Health Care Association, a nursing facility advocacy groups, supports the implementation of the policy initiatives recommended by AARP’s state-specific analysis. But, “The primary driver of our state’s nursing facility use is the extremely advanced age of our elders,” Burke says, noting that the need for nursing facility care is more than triple for those aged 85 and older than for seniors just a decade younger. Due to the state’s demographics you probably won’t see a change of use even if you put more funding into community based home services, she adds.

Governor Gina Raimondo and the General Assembly leadership will most certainly find it challenging to show more improvement by the time the next Scorecard ranks the states. Older Rhode Islanders deserve to have access to a seamless system, taking care of your specific needs. Creative thinking, cutting waste and beefing up programs to keeping people in their homes as long as can happen might just be the first steps to be taken. But, the state must not turn its back on nursing facility care, especially for those who need that level of service.

Herb Weiss, LRI ’12 is a Pawtucket writer who covers aging, health care and medical issues. He can be reached at hweissri@aol.com.

Protecting Retirement Savings Should Be a Priority

Published on March 7, 2015 in the Pawtucket Times

Last month, President Obama used his presidential bully pulpit to publicly support a proposed U.S. Department of Labor (DOL) rule, endorsed by a coalition of aging, labor and consumer groups, that reportedly limits conflicts of interest, increases accountability, and strengthens protection for Americans receiving retirement investment advice.

At the February 23 press conference held at the Washington, D.C.-based AARP headquarters, attended by Obama, Save Our Retirement Coalition members and lawmakers, the President called for the issuing of the proposed rule, still awaiting Office of Management and Budget (OMB) review and final DOL action. The updating of DOL rules and requirements would require higher standards for financial advisors, requiring them to act solely in their client’s best interest when giving financial advice, said Obama.

The Save Our Retirement Coalition says that the final rule is “needed to help protect Americans’ hard earned retirement savings from advisers who recommend investments based on their own interest – such as those that pay generous commissions – not because they serve their clients’ best interest.”

Existing Rules Outdated

In his remarks at AARP, Obama called the rules governing retirement investments written over 40 years ago “outdated,” filled with “legal loopholes,” and just “fine print,” needing an overhaul.  The existing rules governing retirement investments were written “at a time when most workers with a retirement plan had traditional pensions, and IRAs were brand new, and 401ks didn’t even exist,” the President explained.

At the event, Secretary of Labor Thomas E. Perez., claimed that his agency has substantially reached out to “a wide range of stakeholders,” to craft the proposed rule that was sent to OMB.  “The input we have received to date has been invaluable, but we’re not even close to being done. We have a lot more listening to do, and once the Notice of Proposed Rule Making is published in the coming months, I look forward to hearing from as many stakeholders as I can. We’re going to get this right, because the strength of the middle class depends on a secure retirement,” he says.

“We know the people we represent have worked hard to save for retirement, and we believe that they deserve to have financial advisers who work just as hard to protect what they’ve earned,” said AARP CEO Jo Ann Jenkins, in her remarks.  AARP is a member of the Save Our Retirement Coalition.

“AARP, a major consumer advocate, has been fought for this consumer regulation for over five years to ensure that Americans of all ages get the best financial advice when planning for their retirement,” says Jenkins. “Recently AARP also found that 9 out of 10 employers who sponsor retirement savings plans support holding advice to such a ‘best interest’ standard,” she adds. .

“In today’s world, it’s hard enough to save for retirement and achieve your financial goals” added Jenkins. “We don’t need to make it more difficult by allowing some on Wall Street to take advantage of hard-working Americans. Bad financial advice is just wrong,” she says.

According to Save Our Retirement Coalition, “the need for the proposed rule was made starkly apparent in a White House report released showing that conflicts of interest are costing middle class families and billions of dollars annually. The 30 page report, released last month, details the current regulatory environment for financial planners, providing evidence on the negative financial impact of conflicted professional investment advice draining older American’s retirement saving accounts.

The White House report, issued by Council of Economic Advisors, cited evidence pulled from the literature, showing that “conflicted advice reduces investment returns by roughly 1 percentage point for savers receiving that advice” The report also found that “a retiree who receives conflicted advice when rolling over a 401 (k) balance to an IRA at retirement will lose an estimated 12 percent of the value of his or her savings if drawn down over 30 years.  For those receiving conflicted advice “takes withdrawals at the rate possible absent conflicted advice, his or her savings would run out more than 5 years earlier.”

Holding Wall Street Accountable

“Many investment professionals do what’s right,” said AARP Rhode Island State Director Kathleen Connell. ”But loopholes in the law are allowing some on Wall Street  to take advantage of hard-working Americans, recommending investments with higher fees, riskier investments, and lower returns to make even higher profits for themselves. Last year alone, hidden fees, unfair risk and bad investment advice robbed Americans of as much as $17 billion,” she states.

“AARP agrees that financial professionals of all types serve a valuable role in building the wealth and security of the investing public,” added Connell. “We simply want to achieve some consistency in the standards across the industry. Here is Rhode Island, many retirees are very concerned about their investment savings and they deserve protection. Our position is that retirement accounts managed by a broker should receive the same protections as regular investment accounts held with an advisor,” she says.

“Rhode Islanders have who have worked hard for their money and deserve a new standard that holds Wall Street genuinely accountable for helping them choose the best investments for themselves, their family and their future,” she adds.

Security Trade Group Concern

             The Securities Industry and Financial Markets Association (SIFMA), a trade group representing securities firms, banks and asset management companies, is waiting to see the details of the proposed rule.  SIFMA CEO Kenneth E. Bentsen, Jr., stated: “While we cannot comment on a proposal we have not yet seen, we have ongoing concerns that the DOL regulation could adversely affect retirement savers, particularly middle class workers.  The new regulation could limit investor choice, cause inconsistencies as different regulators would apply different standards to the same regulatory accounts, prohibit guidance, and raise the costs of savings for retirement.”

But, both Obama and the Save Our Retirement Coalition strongly disagree with SIFMA’s assessment of the potential impact of DOL’s proposed rule, which has not yet been issued and is ultimately subject to change after the public comment period.

A large majority of financial planners put their clients first when giving them investment advice. But, as you know a few bad apples can truly spoil the barrel.  If trade groups representing financial planners fail to act to rein in financial planners who give conflicted advice to pad their pockets, than federal regulations can quickly do that job by applying “simple, commonsense standards.”

It makes practical and political sense to me.

Here is a linked to President Obama’s comments at the AARP Press Conference: http://www.whitehouse.gov/photos-and-video/video/2015/02/23/president-obama-speaks-aarp.

Herb Weiss, LRI ’12 is a Pawtucket-based writer who covers aging, health care and medical issues.  He can be reached at hweissri@aol.com . Or call 401/ 742-5372.