Not Quite Ready to Retire

Two years ago, Bob Markway retired. Or so he thought. After joining Shell's exploration and production unit in 1973, Markway had climbed the ranks to manage its deepwater operations in the Gulf of Mexico. He had reached an age and accumulated enough years of service to sail off into the sunset with a good pension. Both kids' college tuitions and one of their weddings were out of the way; his 46-ft. sailboat, the Sazerac, beckoned. But then Hurricane Katrina walloped his house two blocks from Lake Pontchartrain, and his plans for a clean break from his career shifted. "Suddenly, having cash outside of retirement plans began to look like a pretty good idea," says Markway, now 55. Besides, he felt a need to be useful. When Shell offered him interesting work on a project basis, he took it--on the condition it not interfere with sailing season.

What Markway is experiencing is a new kind of American career stage: the not-quite-retirement. As life spans lengthen, pensions tighten and workplace rules change, hopping from full-time work to full-time leisure is appearing less realistic and, to some, less desirable. The trend has given rise to a new category of employment, the so-called bridge job. Economists use this term to describe part-time or full-time jobs typically held for less than 10 years following full-time careers. According to a 2005 working paper from the Center on Aging and Work at Boston College, one-half to two-thirds of workers take on bridge jobs before fully retiring--one reason the number of workers 65 and up is expected to increase 117% by 2025. "Why go from 100 m.p.h. to zero?" says Joseph Quinn, a Boston College economist and co-author of the paper. "You wouldn't do that in your car. You'd do 70, then 50, then 20."

The prolonged-work ethic comes at a time when American companies face a demographics-driven crisis: What happens when the 76 million baby boomers retire? As older workers begin to leave work in droves, economists project a labor shortage of 10 million by the end of the decade. Some industries, such as utilities, education and energy, are already struggling to stanch the institutional brain drain. So, older workers want to keep working, and employers need them--crisis solved. Right? Not quite, says Deborah Russell, director of workforce issues at the AARP. Revamping retirement systems requires shifts in attitudes and bureaucratic pension rules. "It comes down to the perception that if you're 58, how much do I want to invest in you?" she says. "This is a critical issue for employers to overcome--for their own good."

Like Shell, some major employers are ahead of the game, offering options like bridge jobs to attract and keep older workers. The advantages are many: surveys find older workers score high in company loyalty and productivity, and the bridge period can be used to transfer a veteran employee's knowledge and skills to the next generation. Quest Diagnostics, Cendant Group, New York Life and Verizon were among 11 corporations that recently teamed with the AARP to figure out how to hire and retain over-50 workers. Eli Lilly, Procter & Gamble and Boeing partner with YourEncore, a placement company for retirees seeking project work. CVS/ pharmacy, Home Depot and Borders have "snowbird" programs to allow older workers to migrate south in winter, jobs in tow.