A story in this morning’s news caught me up. Social Security is apparently in trouble because more people than expected are taking early retirement, often after losing jobs and failing to find new ones. This is making demands on S.S. payouts sooner than expected and drawing down the “trust fund.”

But wait a moment, wasn’t the problem last week that boomers weren’t retiring fast enough? The next generation in line is being denied promotions because their elders aren’t quitting fast enough.

It brings to mind the old country-western song, “How can I miss you if you won’t go away?”

The first story:

Big job losses and a spike in early retirement claims from laid-off seniors will force Social Security to pay out more in benefits than it collects in taxes the next two years, the first time that’s happened since the 1980s.

The deficits – $10 billion in 2010 and $9 billion in 2011 – won’t affect payments to retirees because Social Security has accumulated surpluses from previous years totaling $2.5 trillion. But they will add to the overall federal deficit.

Applications for retirement benefits are 23 percent higher than last year, while disability claims have risen by about 20 percent. Social Security officials had expected applications to increase from the growing number of baby boomers reaching retirement, but they didn’t expect the increase to be so large.

What happened? The recession hit and many older workers suddenly found themselves laid off with no place to turn but Social Security.

“A lot of people who in better times would have continued working are opting to retire,” said Alan J. Auerbach, an economics and law professor at the University of California, Berkeley. “If they were younger, we would call them unemployed.”

The second story:

The financial downturn has left all sorts of casualties in its wake: more unemployment, depressed wages, and greater economic uncertainty. But I’d like to direct my angst at a different target — the baby boomers.

A hidden effect of this crisis is that, in the workplace, as in popular discourse, they simply refuse to get out of the way.

To understand my lament, you have to realize that the oldest of the baby boomers are on the cusp of retirement. For younger generations, this should be a cause for relief. For decades, Gen X-ers like myself have had to hear the standard declarations about the uniqueness of the baby boomers. Maybe they were not the Greatest Generation, but they were the ones who glorified the whole idea of generational identity. For decades, Gen X-ers have had to hear complaints about our political apathy, our popular culture, and our musical tastes.

We have suffered many of these critiques without complaint. Why? Because so many of us worked for so many of them. They were the bosses of the business world. And they were supposed to be retiring very soon, but the recession has changed all that.

In 2008, U.S. workers aged 55 to 64 who had 401(k)’s for at least 20 years saw their retirement balances drop an average of 20 percent. A recent YouGov poll showed two-thirds of this generation have not made the necessary adjustments in their financial planning. This is not a recipe for leaving the workforce anytime soon.

What does this mean for the rest of us? Younger workers who expected promotions when the boomers cleared out are going to have to stew in their own juices. With this job market, looking for a better opportunity elsewhere is not in the cards.

Leaving aside the Boomer bashing, this seems to be a contradiction. Are Boomers retiring early or not? I suspect that some of what’s happening is class based. The managerial and Creative Class 60-somethings are continuing to work because they can and often want to – their skills are relevant, they’re not caught in large layoffs and if they need to they can consult. On the other hand, working class, non college-educated boomers who are laid off aren’t finding jobs – their health care costs are high and they’re expensive to hire. So many of them who can’t find work may be taking Social Security at 62 in spite of the disadvantages (smaller checks, limits on earned income).

Does anyone have statistics on who’s retiring and who’s keeping working?

In Canada, the number of self-employed people has been rising month after month during this recession. Recently, the thousands going into business for themselves have mitigated many of the employment losses and made the Canadian job numbers look reasonably rosy in comparison to the declines happening in the U.S.

The Globe and Mail referred to this as “The Do-It-Yourself” recovery.

On the one hand, this seems logical in a recession – losing a job can be the spark that pushes people into business for themselves. Yet, on the other hand, the same phenomenon does not appear to be happening in the United States. So, what’s happening and what’s significant?

The divergent self-employment trends may be an indicator of different employment, economic, and workplace trends in the two countries.

It should be noted that some economists argue that self-employment is inferior to full-time, salaried employment and thus should be considered an indicator of economic weakness rather than strength in Canada. However, because the numbers of self-employed are growing so early – when collecting EI benefits would still be an option – it suggests this shift to self-employment is more of a deliberate choice than a move made in desperation.

Also, the 55+ age group has been the dominant demographic group shifting into this category in Canada – it may be that well-educated baby boomers are seeking more flexibility and the option to “cash in” on their years of experience and extensive contacts made over the years. Because basic health care coverage is universal in Canada, the aging baby boomers may feel more free to leave their large employer (or not seek another if their employer laid them off).

Implications:

Could this give the Canadian economy the productivity boost (to catch up to American levels) that has been lacking? That is, in pure economic productivity terms, would it be more efficient for many corporations to hire the talent they need when and as they need it via contracting the self-employed?

From the talent’s perspective, could this be the style that allows much better control over work and life balance?

Can salaried staff and free agents work together on teams (when the free-agents might be working on several projects simultaneously for different companies)?

Flipping the coin, does it matter that the U.S. self-employment rate is not growing?

Your thoughts?

Ironically, the most effective telecommuters and home-based workers are those who are naturally great at connecting with people and intuitive, good communicators. This is one of the messages in Kate Lister and Tom Harnish’s new book, Undress for Success: The Naked Truth About Making Money at Home (John Wiley & Sons, 2009). Introverts tend to be less successful working from home.  Another key message is that slackers need not apply — successful home-based workers tend to be self-starters, highly motivated, and dedicated.

With technology now making it possible to work from virtually anywhere, this book offers some advice on whether you should try to do so, and how.

This book covers all variety of work that can be done away from the conventional office. Besides the option of shifting one’s regular corporate or government job to home, the authors cover other possibilities such as becoming a virtual assistant, medical transcriptionist, writer, or virtual nurse or doctor – and detail what’s involved in doing this as an employee or as a freelancer (your own business), including contracts, taxes, self-marketing, and pricing your time.

Although the authors personally have thrived operating their own businesses from home, they are quick to point out the pitfalls, drawing on others’ experiences as well. Among the challenges presented:

• The tendency feel like you should always be working, especially when working flex hours around children’s schedules. Over half of freelancers work more than 48 hours per week, for example.
• The difficulty in convincing family members and friends that you are really working, and therefore cannot be disturbed at certain times.
• How difficult it is for freelancers to maintain a steady stream of work and keep up with administrative requirements: most put in one to four hours of non-paid efforts for every billable hour, the authors claim.
• Self-control if you have tendencies toward over-eating or alcoholism.

The audience for this material appears mainly to be baby boomers, the authors’ generation. Most of the suggested work-from-home options require a number of years of professional experience as well as specific education. The book also devotes considerable time to explain how Google, Facebook, MySpace, Monster.com and Craigslist works, which may be helpful for baby boomers ready to try something different, but probably information that the average gen x’er or millennial person already knows.

Indeed, the authors have been away from the office for so long – and clearly had negative personal experiences with it – that they begin their book with two chapters and a foreword basically saying how ridiculous it is that anyone would want to work in one. They assume that offices are simply places where people waste time at the water cooler and no social interaction that takes place there is productive – which is far from the case in many office environments today where engineers collaborate, researcher-writers get new ideas, video game strategy is debated, and business direction is discussed. The authors miss that workplaces today are increasingly being designed as a resource to support this productive activity, rather than being a generic destination for spending time in exchange for a paycheck.

Most of their examples of office-building-based work sound like the office of the 1970s where strict hierarchies, rote work, and a micro-management approach reigned along with a different dress code. Indeed, Ms. Lister states several times that she left office work because she hated wearing pantyhose – it’s been at least a decade since women routinely felt they needed to wear those (pant suits anyone? or just more casual attire?).

For those readers seriously interested in how to work from home, and whether they possess the aptitudes and skills to do so, this book is a valuable resource – especially if you are over the age of approximately 40 and therefore have the experience to fit yourself into their examples and options. I do suggest you start your reading at chapter three however, where the writing becomes stronger and the inaccurate assumptions about today’s office as well as the forced cliches around working in your underwear are dropped.

Would you want to work from home 100 percent of the time? If you do, what are the pitfalls and benefits?

If you had any doubts, check out these nuggets from a new study by David Rosnick and Dean Baker of the Center for Economic and Policy Research (h/t Robert Wuebker). Boomers are really screwed.

So much home equity has been lost that 30% of boomers, aged 45 to 54, are underwater in their homes, according to “The Wealth of the Baby Boom Cohorts After the Collapse of the Housing Bubble. ” The report, released by D.C.-based think tank the Center for Economic and Policy Research, also found that 18% of boomers aged 55 to 64 would owe money at close if they sold their homes.

The CEPR also found that people who were renting homes in 2004 will have more wealth in 2009 than those who were owners. That’s true for all five wealth groups the study analyzed, from the poorest to the wealthiest …

Boomers between 45 and 54 have lost 45% of their median net worth, leaving them with just $80,000 in net worth, including home equity, according to the report. Older boomers have fared marginally better. Those between 55 and 64 have lost 38% of their net worth, leaving them with $140,000. But this group is rapidly nearing retirement age and they have few working years left to make up the losses.

The full study is here.

Generational and gender shifts are contributing to a different workforce and workplace.

Who is working, the ways they are working, and what kind of work they are doing has changed. How people live their lives outside of work is also different, along with their attitudes toward their careers.

Accounting firm Deloitte & Touche has done their own research to better understand who the new generations of workers are and what they will need from their employer. Here are five facts and analysis taken from Volume 2 of their studies.

Then: Only 37% of married women worked outside the home in 1967.
Now: 61% of married women worked outside the home in 2000.
Implication: Deloitte notes that with a gainfully employed partner, many employees have the flexibility to quit or change jobs whenever they want. Retention is therefore a greater challenge today.

Then: Workers typically had a partner at home who looked after household and personal matters.
Now: Between working married women and working single parents, few employees have a “homemaker” at home.
Implication: Employees need flexibility to handle personal matters and blend their energy between personal and professional.

Then: Men earned the majority of university degrees.
Now: Women earn 55% of all accounting degrees (and 55% of bachelor’s and master’s degrees as of 1998 according to Knoll).
Implications: Attracting and retaining women will be essential for firms like Deloitte (as well as many knowledge economy companies).

Then: Older baby boomer fathers spent an average of 2.2 hours per day with their children.
Now: Generation X fathers spend and average of 3.4 hours per day with their children and 90% say they have either a primary or equal focus on the family compared to work.
Implication: A generation gap at Deloitte who notes that “although many of the leaders in our organization have a stay-at-home partner and a single-minded focus on work, only a small proportion of today’s younger workforce places a primary focus on work.”

Then: Most baby boomers wanted to climb the corporate ladder. In 1992, 66% of college-educated men and 50% of college educated women wanted to move into jobs with more responsibility.
Now: In 2002, only 50% of college educated men and 35% of college-educated women wanted more responsibility. In an independent (non-Deloitte) study, 80% of prime candidates for promotion wanted to work fewer hours.
Implication: Today’s employees will work hard, but will typically not work longer hours and will frequently not trade promotion for their personal time.

I would argue that because of corporate inertia (sticking with “the way things have always been done”) the workplace does not fully reflect these new realities. There is a tension between the previous approach to life that centered on work, and a more current one in which work is blended into the rest of a person’s everyday life.

But changes are happening. When the big four accounting firms are making dramatic changes to work philosophies (and not just Google), it provides strong evidence that mobile and flexible workplaces are not a fad.

“The only thing [McCain] is going to let [Palin] do in the White House is teach him how to use the Internet.”

- A comment on McCain’s nomination of Sarah Palin as his vice presidential running mate

A generational shift in corporate leadership positions is one reason why workplace change is accelerating. The wartime generation (McCain’s cohort) along with the older Baby Boomers have generally retired or stepped away from the day-to-day management of large numbers of employees.

Meanwhile, younger Baby Boomers and older members of Generation X have taken over. They understand the Internet, a range of business software applications, the power of mobile computing, and the need to both collaborate and, at times, separate oneself from the office in order to think through issues clearly. Many have developed a love affair with Blackberries and similar devices that allow more mobility.

Today, I believe that there is much less of a generation gap in the workforce than 10 years ago, especially when it comes to technology, and despite what some other workplace writers say.

Here’s an example (supplied on the condition that the company not be publicly named): In a specific division, almost all employees were offered the chance to become mobile, and trusted to work when and where they needed. Or, they could retain the status quo – a private office or workstation depending upon their job. The majority chose mobility.

But what’s interesting is that 1/3 were Generation Y; 1/3 Generation X; and 1/3 Baby Boomers, and this is roughly the age breakdown of that company.

Those who resisted losing an office tended to be workers of any generation who had only recently been promoted to a position with a private office. Those who had their own office for a long time seemed to prefer the idea of working from home occasionally, flexible hours, and being able to sit “where the action was” within the company.

And technology is just one area where the workplace has changed. Management hierarchies have also tended to flatten and company leadership at middle levels is often more fluid, with people switching roles from time to time. Higher productivity in knowledge-based work typically requires employees to feel inspired – a difference from more service-oriented work in which hiring more people or insisting on longer hours would increase output.

Each workplaces is, of course, different. All of this may (or may not) be irrelevant at the White House.

Do you perceive a distinct generation gap where you work? Or is the gap along different lines?

In Who’s Your City?, I wrote that the old trend of kids moving home after college was beginning to give way to a new one – boomer parents following their kids to more exciting cities. According to this New York Times report, it’s starting earlier than that. I’d heard about affluent parents buying condos for their kids to live in during college. But now, apparently, parents are following their kids to college and buying their own homes there. And to think: I went “away” to college (30 miles down the New Jersey Turnpike to Rutgers College) to get away from my parents’ ever-watchful eyes. I guess it’s less distance to travel to get the laundry done.