Blog Posts

A Tipping Point for Corporate Culture

11/1/2017

When I began writing about the workplace on a regular basis in 1988, today’s timely topic of sexual harassment was still emerging from water-cooler shadows.

Our tight-knit group of highly spirited male and female writers, editors and office-support staffers used to joke how sexual harassment was actually an employee benefit at the small publishing company where we toiled away. There were a lot of harmless, off-color remarks bandied about in the face of intense deadlines and high expectations. It was a time when emotional intelligence and maturity were in short supply.

I cringe when thinking about overstepping the bounds of good taste to add levity or soothe a bruised ego over a potential office romance that never ignited. No one is perfect, and I will gladly take a number and wait in a long line along with anyone else who seeks atonement for crossing a line that now seems to have transformed from sand to cement. What’s fascinating to me is that Corporate America – along with Hollywood, the world of politics, education and nearly every nook and cranny in society – has reached a significant and historic tipping point.

We live in very different times than three decades ago, and I’m heartened to see an important cultural change take root whereby once-powerful figures are finally being held accountable and suffering actual consequences. It’s akin to watershed events in movements seeking an end to discrimination based on gender, race, religion or sexual orientation, as well as equal rights.

Since more than 50 women apiece have accused both comedian Bill Cosby and movie producer Harvey Weinstein of sexual harassment, assault or rape, a floodgate of similar charges have been unleashed and aimed at many other powerful men dating back decades before the statute of limitations have run out on the possibility of pursuing legal action. The list is long. It includes stories that are both old and new – everyone from Roger Ailes and Bill O’Reilly to Eric Bolling and Mark Halperin to Roman Polanski and Woody Allen and Bill Clinton to Donald Trump have been caught in the crosshairs of this mounting national controversy.

When I interviewed famed discrimination attorney Gloria Allred about the Bill Cosby revelations, she noted at the time that “it’s a wake-up call for women and men.” The same can be said about scaling a harrowing timeline on sexual harassment over the past month or so.

I’m hopeful that more victims of unwanted advances will come forward swiftly and decisively to their HR departments. I’m also hoping that we as a society will take these allegations more seriously and that HR leaders pressure top executives to investigate and mete out punishment where necessary. That goes for holding jerks and predators alike accountable for unacceptable behavior.

Why We Need to Think Outside the Cubicle

9/29/2017

For 18 years and counting, I have lived in an area long known for having the nation’s worst traffic congestion not only during rush hours, but also off-peak times. As an independent contractor, I have been able to dodge this asphalt madness with a so-called carpet commute from my bedroom to a living room office.

Los Angeles is driven by a car culture, with nearly 4 million estimated residents in the second-largest U.S. city scrambling for limited space on freeways so big that their numbers are actually preceded by the word “the” to describe them in the vernacular. The county’s population is more than double that number, while the larger metropolitan region more than triples the body count. It’s not surprising given that L.A. is the entertainment capital of the world and ground zero for California dreaming.

What made me appreciate an ability to work from home more than usual was a recent article I wrote about telecommuting. However, it also made me lament a troubling trend that has befallen legions of managers and supervisors across Corporate America.

A survey of executive recruiters, employers and job candidates cautioned that ordering remote workers back into corporate offices could alienate top talent in the executive, managerial and professional ranks. What’s more, it is happening at a time of tightening skilled labor markets.

One of my sources, a seasoned industry observer, called out AT&T, Yahoo!, Hewlett Packard and IBM’s marketing division as chief culprits. By ending work-from-home arrangements, he noted how they stood to lose millions of dollars a year they previously saved on consolidating office space and worsen traffic congestion in their respective cities.

It’s a real head-scratcher for me to think that such a counter-intuitive directive could be repeated by several respected blue-chip companies – and in the process, eviscerate years of operational efficiency, corporate goodwill, high morale and employee loyalty. My impression of this cultural change based on the interviews I conducted is that it stems from self-imposed pressure that has turned telecommuting into a convenient scapegoat for missing quarterly earnings or losing market share.

But the fact is we all operate in a virtual world wherein the line of demarcation between work and life is barely recognizable and all office workers really need is a way to get online. If texts or emails aren’t enough to complete a certain task, then there’s always conferencing calling or video-chatting services. I even remember seeing a movie featuring holograms beamed up for a corporate boardroom meeting, which now seems more like a realistic future than science fiction.

It no longer makes sense to tether people to a cubicle or office in this changing business environment, especially since U.S. workers are infamous for not using all of their vacation time and burning the midnight oil. The number of working Americans who griped about working more than 40 hours a week spiked to 26% last year from just 6% in 1974, according to government data cited in a report by The Wall Street Journal.

My view of the situation, of course, isn’t surprising. I have a dog in this fight as someone who has benefited from telecommuting for nearly half my 34-year career. But if we truly want to work faster and smarter, or at least happier and healthier, then why not let flexible work schedules offered as a valued employee benefit lead the way? It’s better than caving into a misguided notion that employees or managers must be able to literally brush up against one another at all, or most, times during the work day.

How Movie Studios Can Fire on All Cylinders

9/5/2017

While running errands the other day, one of my favorite local afternoon talk radio shows noted that Hollywood is facing its worst box-office run in 25 years and then opened up the phone lines to ask listeners whether or not they still go to the movies.

Most of the callers griped about overpriced tickets, texting moviegoers and subpar material – noting that it’s better to simply rent a DVD or watch something on demand in the comfort of their own home. Others are too busy playing video games, keeping up with friends and family on social media or other hobbies.

All of these developments were starting to take hold in the early 2000s when I closely covered Hollywood for various trade publications. Among the most worried were theater chain owners, known in Tinsel Town as “exhibitors.”

Fast forward to 2017, which industry insiders consider another golden age for television, and you’d be hard pressed to find really good quality cinema. Most of the fare these days is formulaic and uninspiring, dominated by so-called franchise pictures and tired sequels, car chases, mind-numbing violence and eye-popping visual effects. It’s not my idea of a fun night out, and apparently most Americans agree.

But as an avid moviegoer, I simply look for alternatives and frequently choose an art house theater a block and a half from my home that features the best independent and foreign films money can buy.

Rarely do I come across a blockbuster that speaks to me on a cerebral or emotional level, and when I’m truly lucky, I get a little of both. One such film (don’t laugh) is “Cars 3.” Yes, an animated film aimed primarily at children, but also one that can appeal to grownups. This release proves once again that Disney Pixar hands down has the best track record of any movie studio in Hollywood history when it comes to quality cinema. If only the other major studios would tear a page from their impressive playbook, then maybe they, too, would be firing on all cylinders – literally and figuratively.

The reason is simple: a terrific story at the core that’s perfectly told, has wonderful pacing, a compelling subplot, wonderful character development and killer themes around which anyone at any age can wrap their hearts and minds. “Cars 3” is a thoughtful film, and I think the best of all three in this winning franchise.

What I like about this film is all the wonderful lessons it teaches the little ones, though I still haven’t been able to convince my own 6 and 8 year olds to see it (they’ve outgrown this particular franchise!). They also translate so well to my principle topic of interest for nearly 30 years, which is the workplace.

In the end, it’s a film about following your occupational dreams (i.e., moving from “trainer” to race car driver), knowing when it’s time to do something else (i.e., retiring from racing to mentor a rising star), honoring the past (i.e., recognizing the contributions of trailblazers) and being fully in charge of your own destiny (i.e., not allowing others to force your fate). Ironically, critics and audiences on Rotten Tomatoes give it only a satisfactory rating, which I suppose just goes to show how subjective it is to measure the quality of movie content.

In my view, good stories are the missing ingredient in so many movies and have been for a long while – at least since the last truly golden age of cinema in the 1970s. If you offer a product or service that’s second to none in any business, then you’ll acquire customers.

That’s why TV is clobbering movies. There’s so much more creativity and choice on the small screen. And whereas movie stars used to look down upon their peers who did TV shows, they’re all drawn to that medium now for a number of reasons. One is they’re following the money – and lots of it. With Netflix and Amazon.com getting into the act, lucrative deals abound for top talent. A TV show’s schedule is also more 9-5 than on movie sets, so it’s appealing to both cast and crew members who’d rather live a more normal life. But that’s also where the entertainment industry’s mojo has been now for a while and probably will stay.

What Hollywood needs is more movie studios like Disney Pixar whose primary focus is on great storytelling. To paraphrase that famous line from “Field of Dreams”: “If you build it, they will come.” Movie studio execs, along with theater chain owners, need to heed that call, or they’ll continue to lose the huge audiences they’ve been accustomed to seeing year after year.

Work Less, Play More and Higher Productivity, Loyalty and Satisfaction will Follow

7/10/2017

Whenever summer rolls around, I can’t help but think how hard Americans work and fail to take all the vacation time they’ve accrued – often at the expense of their wellbeing. If only we could be more like Europe when it comes to our attitude about paid time off (more on that later).

How ironic that I’m actually penning this blog midway through what I like to call a “working” vacation for three weeks during which I’m hoping to barely work and play as much as possible. So far so good!

Months ago, I was intrigued by a study of more than 600,000 workers from the U.S., Europe and Australia that suggested those who toil away for 55 hours a week run a 33% greater risk of having a stroke than those who work 35 to 40 hours. Another key finding was a 13% increased risk of developing coronary heart disease.

Other related developments that caught my eye include a two-year experiment in Sweden where businesses are embracing a standard six-hour work day. Preliminary results have been mixed. While improvements have been reported in the areas of employee satisfaction and health, for example, higher employment costs were seen in some cases where additional staffers had to be brought on board.

Linus Feldt, CEO of Stockholm-based app developer Filimundus, which switched to the compressed work week last year, questioned the effectiveness of an eight-hour work day and encouraged employees to spend more time with their families, learn or exercise more. One tradeoff for workers there was a request to steer clear of social media and other distractions at work, while management would not have as many meetings. The strategic objective (and hope) is that employees will have more motivation and energy to get more done in fewer hours.

Several Toyota service centers in Gothenburg, the country’s second-largest city, made the switch as many as 13 years ago, reporting happier staffers, lower turnover and better recruitment of new hires.

In a Fortune commentary, S. Kumar wrote urged Corporate America to adopt the six-hour work day, arguing that “shortening the work day may not quash around-the-clock emails and conference calls, but at the very least, it would reduce stress for workers during the work day.”

When thinking about this topic, I’m also reminded of a provocative interview I heard on a talk radio show earlier in the year about a Brave New World that’s upon us. An expert predicted that the robotics revolution will force developed countries to essentially pay people to do nothing in the years ahead. But I’ve also seen commentaries that suggest jobs will evolve and grow with innovation. Case in point: the emerging specialty of robotics management. Someone still has to tell the robots what to do and keep track of what they’re doing, right?!

Whatever might, or might not, happen with regard to the eight-hour work day, I’ve always been a big believer in efficiency and nimble operations. One such approach is telecommuting, which I’ve been doing now for nearly 18 years. My motivation, energy and time management have always been much higher during that time than when I was at an office attempting to dodge water-cooler banter lest I’d miss a writing deadline.

History Repeats on Health Care Reform: It's Deja Vu All Over Again!

3/17/2017

As the White House and congressional Republicans scramble to repeal and replace the Affordable Care Act with viable legislation that will earn enough votes in the House and Senate, I’m reminded of the past.

It was nearly seven years ago to the date when the ACA, aka Obamacare, was enacted. The first of many huge mistakes that would follow is that the landmark bill, while well-intentioned and politically courageous, sailed through without a single Republican vote. That bothered me a lot, and I blogged about it at that time. Now the Democrats are vowing to do the same to whatever eventually emerges in the vernacular as Trumpcare.

This is why I’ve long been a registered independent. Not since the days when Ronald Reagan and Tip O’Neil could hammer out compromises on issues of the day and grab a beer afterward has either major political party in the U.S. been able to work together in a respectful and bipartisan way that benefits the entire electorate. Citizens are sick of gridlock and deserve much better than the deck of cards politicians have been playing with in recent decades.

But I digress. Health care is serious business. Lives literally hang in the balance over this issue, and many of us are getting a raw deal in terms of sky-high premiums for which we receive very little value.The greatest irony of the ACA is that, despite reducing the number of uninsured Americans by about 20 million through public exchanges and Medicaid expansion it failed to deliver on the operative word, which is to make care affordable for the average American.

Of course, there are many explanations for that colossal failure. Namely: not enough young or healthy people signed up for coverage after being uninsured, federal mandates such as the medical loss ratio tied the hands of insurers, premium-stabilization efforts stalled and triggered litigation, nothing was done to curtail pharmaceutical spending and nonprofit cooperatives that were supposed to compete with commercial carriers in underserved markets collapsed when their funding source dried up.

Moreover, the health insurance market still largely chases the low hanging fruit associated with cost-shifting onto consumers rather than fix the root causes of expensive care, people don’t take enough personal responsibility or make healthy choices and doctor pay continues to be based on patient volume rather than outcomes – with wild variations that make the cost of leading procedures appear arbitrary and perverse. It’s also highly confusing and frustrating for consumers and large health care payers who lack simple and standard quality measures.

I had to chuckle upon recently hearing President Trump admit that repealing and replacing Obamacare is proving to be much harder than he anticipated. “Nobody knew that health care could be so complicated,” he said. You’re damn right it’s complicated!

And with that in mind, I can only hope that the White House and Republicans in both houses of Congress take their time before passing any legislation to fix current problems. I also hope that Democrats place love of country over partisan politics and be willing to not only accept responsibility for the ACA’s failures, but also offer their constructive input and compromise rather than obstruct when the time comes to seek a better solution.

Let’s finally get health care reform right. Our lives and wallets depend on it!

It's Time to Stop Demonizing the Media and Respect the Mission of a Free Press

2/1/2017

When I first became interested in journalism in the late 1960s and then decided to pursue it as a career, Bob Woodward and Carl Bernstein were rock stars in a profession that drew in scores of people just like me. We were young, naive, noble, idealistic, well intentioned and passionate. We wanted to change the world or make history – as Woodward and Bernstein surely did.

In deciding on this commitment, we placed a relentless pursuit of the truth ahead of earning a comfortable living. Many of my college classmates later went into public relations or marketing when they grew tired of living on ramen noodles and shopping for clothes at Goodwill.

But not me – I toughed it out, and after five seemingly endless salad years in the newspaper business, patience bore the sweetest possible fruit. I “followed the money,” as Woodward and Bernstein did in their groundbreaking Watergate reporting, and discovered I could actually make a decent living in trade journalism. Translation: writing for a sophisticated audience whose education went far beyond the fifth grade level that general assignment reporters are expected to infuse in their storytelling.

In making this transition, I learned the ropes on writing for business people rather than consumers of news in the general populace. That meant emphasizing solutions and not belaboring problems. But one thing never changed, which was to present a balanced view wherever possible.

Much has changed since I became a journalist. Members of the media are no longer viewed in a positive light, and in fact, we’re seen as no better than used car salesman, telemarketers or other smarmy folks. The public eventually turned on the profession and lost its trust in us. News outlets were accused of false or biased reporting, not covering important stories or reacting to events rather than being proactive or muckraking enough.

Given this trend, a growing number of the sources I interview routinely ask to review the accuracy of my reporting prior to publication so that they’re not misquoted. Some of my editors confirm the same request being made to other freelancers like me or staff writers.

While I totally understand and appreciate why such criticism is so intense and agree that the profession must do a much better job to restore public trust in the so-called Fourth Estate of democracy, I take issue with the way President Trump and his foot soldiers are portraying us. They have gone way off the deep end in making hysterical and incendiary generalizations – demonizing the entire news-gathering field.

At least Trump recently walked back some of the vitriolic remarks from those in his inner circle by pointing out that not all journalists are doing a lousy job. He even praised members of the media for showing restraint on reporting unconfirmed allegations about his behavior in Russian hotels during business trips.

But his administration’s new war on the media is disturbing on a number of levels. Chief White House strategist Steve Bannon recently made several blanket statements about news organizations that I found overly emotional, hyperbolic and offensive. In a rare interview with the New York Times, the former head of Breitbart News described journalists as “among the most dishonest people on earth” and possessing “zero integrity, zero intelligence, and no hard work.” He went on to describe the media, and not democrats, as “the opposition party,” and even suggested the profession “keep its mouth shut.”

His remarks are not only unfair, but nonsensical in a society that prides itself on having a free press. It’s the job of journalists to question authority, and while many conservatives rightfully gripe that media members with a liberal bias didn’t do nearly enough of that when a democrat ran the White House, now that the shoe is on the other foot, so to speak, they need to respect our mission as well as freedom of expression.

Stephen Engelberg, editor in chief of the nonprofit news organization ProPublica, perhaps said it best when he recently wrote that journalists “are part of an essential function in any democracy.”
Now more than ever, the media needs to be even more aggressive, yet also painstakingly accurate, in its reporting for a few reasons. In pledging to drain the proverbial swamp of ineffective or corrupt Washington, D.C., insiders, bureaucrats and lobbyists, the newest occupant at 1600 Pennsylvania Ave. must show a willingness to accept the personal scrutiny that goes along with his new job title.

We’ve never had a president or pack of nominees for key cabinet posts who have collectively shown such an alarmingly high level of potential conflicts of interest where business and politics intersect. It’s only natural and logical that these connections be reported on and investigated. That’s a healthy thing.

I actually admire the fact that Donald Trump disrupted politics as usual and pledged to make government more efficient. The system most definitely needs to be fixed, but we also need the return of a bipartisan spirit that places love of country ahead of ideology. That could very well be why I've been a registered independent voter for as long as I can remember.

My readers, largely comprised of HR executives and consultants, certainly appreciated these campaign promises and are hopeful that his administration will roll back regulations that have hamstrung businesses and triggered unintended consequences. Four years from now, we all might be pleasantly surprised if he’s able to produce some positive results.

But until we reach that point, I hope the Trump administration takes a deep breath before deepening any bitterness toward the media and realize that not all journalists are out to bring down the White House or Republican establishment. Some of us are even brave and have died over a commitment to reporting the truth. There have been 1,228 journalists killed since 1992, while a 2016 prison census shows 259 journalists jailed worldwide, according to the Committee to Protect Journalists.

In hostile parts of the world like Iran or North Korea, government officials would just as soon chop off the hands of journalists or execute them without a trial in the face of any criticism. In the U.S., where a free press flourishes – warts and all – the worst we can expect is a tongue lashing or losing our job over an egregious mistake. The new leadership in Washington, D.C., needs to be reminded of these facts and place its view of the press in perspective before fueling a senseless war on free speech. I think they have more important things to do – like create more jobs, weed out terrorism, improve our infrastructure and education, and, dare I say, make American great again!

Sharing Is Caring When it Comes to Employee Health Care Data

12/8/2016

I had an epiphany while researching a recent article on so-called “medical captive” insurance to help level the playing field for mid-market employers who pledge a more aggressive stance on containing their employee health care costs.

It got me thinking that President-elect Donald Trump and his advisers should become better acquainted with this issue before tinkering with the employer-provided health insurance system. And it reminded me of the time President Barak Obama signed the landmark Affordable Care Act, aka Obamacare, into law without any Republican support. The part that troubles me about both situations is that poor decisions were made, or continue to be made, in a vacuum with little or no thought given to unintended consequences or the impact on various stakeholders.

Let me explain further: My main source for the story suggested that these specialized arrangements are designed to wrest control from “managed care intermediaries that hold employee health data hostage” in fully insured group plans. His list of chief offenders includes so-called BUCA plans (i.e., Blue Cross Blue Shield, UnitedHealthcare, Cigna and Aetna).
He also noted that health insurance carriers withhold detailed claims information from the employers to whom they provide group insurance often under the guise of concern about violating the Health Insurance Portability and Accountability Act and won’t even share it in aggregate form.

Employers that are fed up with rising insurance costs for their employees and family members have increasingly decided to ditch the annual increases from insurance carriers and self-fund the benefits with the help of stop-loss insurance, third-party administrators, consultants and other specialists. In some cases, they also turn to insurers for “administrative service only” contracts. The trend is finally trickling down market to smaller businesses that are the backbone of the U.S. economy.

The fact that none of the BUCAs or trade group that reps health insurance carriers, nor a leading health care analytics firm, would even comment for the story I wrote was very telling. It’s almost as if they simply decided not to defend an indefensible practice, or in the case of that analytics company, upset any of the insurers that hire their analysts.

It also reflects a critical moment in time for employers and their advisers about the current state of fully insured group health insurance relative to self insurance and alternative risk transfer arrangements such as medical captives.

The cost savings of the captive scheme I wrote about was pegged at 20% on average, which provides a double-digit advantage over traditional fixed cost health insurance for like-minded employers that band together to leverage their purchasing power and secure direct contracts with health care providers.

It certainly has the attention of industry leaders. I quoted the head of a key business coalition on health care issues who said “employers have a fiduciary responsibility to manage their plans effectively, and they can’t be handcuffed in doing so without appropriate and transparent access to the data.”

Another source of mine made a humorous analogy by suggesting sports fans have more information about their fantasy football team than business owners have about the health and welfare of their employee population.

Health insurance is complex enough to understand and manage, and it doesn’t need to be further complicated by industry power brokers that are too busy looking after their own interests to do right by their customers. Without hearing their side of the story, my only conclusion is that the nation’s leading health insurance carriers are placing their profits ahead of people.In fact, a former insurance broker who now heads a company that provides HR departments with inexpensive resources told me that “carriers don’t want to share usage data because it causes them to lose their profitable groups.”

Ironically, this is the same group that politically left-leaning critics described as benefiting from a wet kiss in the form of Obamacare, which gave them an opportunity to insure 46 million new customers rather than submit to deeper regulatory scrutiny about their business practices and pricing. Competition would take care of those concerns, at least in theory, and we all know how well that has worked out with several major insurers bailing out of federal and state-run health insurance exchanges amid steep costs for carriers and consumers alike.

What’s unfortunate is that lives actually hang in the balance over their collective decision not to be forthcoming about sharing meaningful health claims information. As someone who has written extensively over the past four years about the power and merits of self-insurance, I can only hope that more employers take this path in hopes of doing a better job at managing costs than health insurers that continue to operate without enough transparency.

Time to Rethink Executive Exit Packages?

10/5/2016

There’s a clear business imperative to robust executive compensation and severance benefits, but it can collide with public outrage and turn off customers when leaders are accused of compromising positions or caught in corporate scandals. It’s also an opportunity for HR and PR departments alike to engage in damage control and revisit corporate policies. As for benefit brokers and advisers, they can help craft a strategy that anticipates and addresses these issues.

Two such examples from over the summer come to mind. The first involved sexual harassment allegations against former Fox News CEO Roger Ailes whose exit package totaled $40 million, the unpaid balance on his contract. As one of the most feared and admired figures in cable TV news, he was accused of bawdy patterns involving multiple female on-air personalities and Machiavellian plots to silence opponents.

The second involved two C-Suiters from Wells Fargo following a probe of the retail bank’s phony accounts scandal. CEO John Stumpf was grilled at a congressional hearing by Sen. Elizabeth Warren (D-Mass.), who suggested he resign or at least forego his pay.

His initial response was defiant, but after mounting pressure from lawmakers and shareholders to be held accountable for allowing high-pressure sales tactics on his watch, the bank’s board took swift action. The chief exec was forced to forfeit much of his 2016 salary, which included a bonus and $41 million in stock (coincidentally just north of Ailes’ severance).

News of his stunning concession was accompanied by an announcement that Carrie Tolstedt, who ran the division where these accounts were created, immediately left Wells Fargo ahead of a scheduled retirement at the end of this year. She also was pressured into giving up a bonus and severance, as well as forfeit all $19 million worth of her unvested stock awards and not exercise $34 million in stock options during the investigation.

Despite these eye-popping givebacks, about $43.3 million in stock Tolstedt owns outright from her career at Wells Fargo will line her nest egg, which could nearly double if she’s allowed to keep options valued today at an estimated $77 million.

On the heels of these developments comes a class action lawsuit by former employees and vilified whistleblowers who felt victimized by an unhealthy corporate culture of greed and unethical practices.

As for Ailes, who hasn’t admitted to sexual harassment or stood trial over those charges, there’s no indication that he’ll decline a generous severance from one of the most infamous golden handshakes in recent corporate history.

Anita Hill, who 25 years ago accused then-Supreme Court nominee Clarence Thomas of sexual harassment, suggested in one report that the co-founder of Fox News “injured the company in a way that would keep him from being entitled to a severance pay.”

Whatever ends up happening next with these two high-profile scandals, the fact remains that they serve as teachable moments for those in the industry whose role involves recognizing and rewarding executives. Is it time to make a morals clause a standard part of executive exit packages across Corporate America? It’s a question some might want to ponder. However generous benefits and comp practices are at various organizations, it seems at least the public – if not the boardroom – would hope they’re tied only to a job well done.

Is the Sky Falling on Retirements?

6/15/2016

I don’t want to sound like Chicken Little, but the sky is falling on retirements in the U.S. And unless the average consumer becomes much more prudent about spending and saving their income, along with meaningful public policy reforms and innovative financial products or services, our current notion of life after work will never be the same. Put another way: Retirement will be unattainable for most Americans and considered an anomaly or blip on history’s radar.

There are a number of reasons why that could turn out to be the case. Let’s start with some sobering numbers. As I wrote in a 2009 blog:

“Most experts on the retirement-planning topic suggest that workers will need to salt away more than $1 million in order to live comfortably after they quite working, which these days could last as long as 30 years considering advances in medical science that have extended the average lifespan. About 25% of those dollars will be spent on health care bills, which have been rising faster than the rate of inflation for many years.”

As many as 68% of millennials who are eligible to participate in a 401(k) plan don’t, according to a recent T. Rowe Price survey that suggested these young workers should be saving about 10% of their annual income for retirement.

But here’s the rub: Many of them are drowning in debt. The average graduate holds about $28,950 in student loan debt, according to the Project on Student Debt. Americans now owe more than $1 trillion in outstanding student loans based on various federal government estimates.

From an anecdotal perspective, we all know people or friends of friends who are paying off more than $100,000 they had to borrow for a college degree. Can you imagine entrants to the workforce thinking about retirement when they need to work off a mountain of debt? Student loan refinancing programs are being called the new 401(k).

Another factor to consider is the sharp rise of robotics, which could render a number of jobs obsolete in the years ahead. Couple that with work continuing to be outsourced abroad in a global economy mired in unfair trade practices and it’s a perfect storm for social chaos.

Finally, for those American who are fortunate enough to actually retiree, University of Michigan researchers have found that fewer of them are “very satisfied” with life after work and a growing number are “not at all satisfied.” Apparently, the higher someone’s net worth the higher their retirement satisfaction, which also plummets with poor health. No surprise there.

But I also believe that ageism will be another factor that delays or eliminates retirement right alongside inadequate income streams. In addition, there always will be a growing share of Americans whose identities are tied to their work, and therefore, they will voluntarily decide that retirement just isn’t for them.

Whatever the case may be, it will be interesting to see how these trends play out.

Welcome to the Dark Side of the American Dream

5/5/2016

Student loan refinancing for millennial workers represents a potentially huge opportunity to attract and retain an energetic young talent pool, but there’s a dark side to this employee benefit offering.