The economy has made it harder for business owners to part from their businesses, and the material handling industry is no exception to this trend. When The MHEDA Journal spoke to members for the 2011 Industry Forecast, several business owners said they couldn’t even think about taking a vacation. Where business owners are hard-pressed to take leave from their companies, the thought of retirement is quickly becoming remote.
A recent survey by Gallup/Wells Fargo points to the rising age of retirement for small business owners. Not only is the age of retirement going up, but increasingly, owners say they may never retire—at least not until forced to do so for health reasons. Forty-seven percent of those surveyed responded as such, up from relatively steady numbers of 38 and 40 percent in 2005 and 2007 respectively.
For those who do plan to retire, the numbers speak for themselves: 69 percent of respondents said they don’t expect to retire before 65, a significant increase from 2005, when only 41 percent planned to stick around as long. And the “older” in “65 and older” may be going up as well. According to the Social Security Administration, only those born before 1938 can receive full social security benefits at age 65. The normal retirement age is 66 for anyone born between 1943 and 1954, and progresses to 67 for those born after 1960. Earlier this year, the Senate debated raising the retirement age even further.
A Shortage of Workers
As the economy forces many employees to stick around longer than they originally planned, the material handling industry faces a challenge. The industry faces a worker shortage, and during the down economy, there was an increased emphasis on having a lean staff. With companies working at full capacity with a reduced staff, it becomes impractical or impossible for an owner to retire without jeopardizing the business. In “The Art of Material Handling Leadership,” Dr. Shankar Basu, president and CEO of Toyota-Lift of Los Angeles (Santa Fe Springs, CA), says, “As Baby Boomers approach retirement age, there is a severe shortage of qualified people in our businesses. This places extreme importance on succession planning. Unfortunately, this topic remains grossly neglected by material handling distributors.”
Can’t Buy Me Love
The economy has caused many business owners to change their retirement plans—60 percent of those polled, according to Gallup/Wells Fargo. There are many obstacles making it harder to retire, ranging from social security and lost investments to being understaffed. But when owners were asked what they would do if money were no object, 51 percent said they would continue working, and another 18 percent said they would start another business. As Howard Bernstein says in “The Man In The Straw Hat Steps Down,” “I considered retirement when I turned 65, but I just wasn’t interested in playing golf and bridge. Interacting with customers, suppliers, MHEDA members—all of those things were just more interesting to me than being retired.” When it comes down to it, there are many reasons to keep working—but perhaps none is better than loving what you do.
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