Boomers

Pew Research, Urban Institute and Gloomy Boomers

Pew Research Center recently released a study entitled “Baby Boomers: the Gloomiest Generation.” Widespread commentary about this study in op-ed columns and news articles has weighed real and mythic factors that might contribute to a generation suffering its contemporary zeitgeist of dreariness.

Then this week, the Urban Institute released a new study, "Will Employers Want Aging Boomers?"

Because a primary driver of dread is economic insecurity about the future, these studies provide interesting juxtaposition and invite further analysis.

Being part of a large generation has its advantages in the aggregate (including collective impact on mainstream culture and business), but a large generation often penalizes individual members.

Millions of Boomers have not had optimum opportunities to achieve their goals due to numerous socioeconomic factors, including competition for entry-level jobs, corporate downsizing and offshoring of jobs. Generational competition has further limited the number of opportunities for top-paying jobs; only so many positions exist at the C-level; only so many have the right stuff to succeed as entrepreneurs.

Guaranteed retirement benefits (defined benefit plans) have morphed into defined contribution plans, placing retirement assets at risk in stock markets. The recent market downturn has caused many pre-retirees to lose 10% to more than 40% of the value in their retirement portfolios.

While nearly 30% of the generation have college degrees, 70% don’t. This has further limited economic opportunities as the nation has shifted from manufacturing to a knowledge-based economy, beginning in the mid-1980s. College-educated Boomers will have more robust vocational opportunities in the future than do those without post-secondary education.

A July 22, 2008 article in the New York Times points to the emergence of a slowdown in workforce opportunities for Boomer women after decades of gains:

“After moving into virtually every occupation, women are being afflicted on a large scale by the same troubles as men: downturns, layoffs, outsourcing, stagnant wages or the discouraging prospect of an outright pay cut.

“Indeed, for the first time since the women’s movement came to life, an economic recovery has come and gone, and the percentage of women at work has fallen, not risen, the Bureau of Labor Statistics reports. Each of the seven previous recoveries since 1960 ended with a greater percentage of women at work than when it began.”

Chronic underemployment and accelerating costs of raising children have influenced lower retirement savings rates (with one-third of the generation economically insolvent today), thus diminishing a real sense of independence and economic security.

According the Pew study, around 55% of Boomers believe it’s likely their incomes will not keep up with the cost of living over the next year, compared with 44% of younger Americans and 43% of older generations. This is an anomaly because Boomers are in their peak earning years, with higher median household income than other generations (based on U.S. census data from 2006).

Findings in the Urban Institute study point to some reasons why Boomers can legitimately be concerned about future income shortfall:

“…an increase in global labor supply, which U.S. firms can tap through outsourcing or immigration, will more than make up for any slowdown in the domestic labor force (Cappeli 2005; Freeman 2007). The emergence of China, India, and nations from the former Soviet Union in the world economy may have doubled the supply of workers worldwide. If the expected shortage in prime-age workers does not materialize, employers may face fewer incentives to turn to older workers.”

Not only is global competition a Boomer concern, generational overcrowding may again become an economic factor. According to the Urban Institute study:

“The substantial increase in the share of the workforce over age 55 in the coming years could lead to a glut of older workers despite the overall labor force slowdown (Sapozhnikov and Triest 2007). Too many older workers could result in lower wages and employment rates at older ages.”

Besides, higher income is meaningless for those with higher expenses. Although the Pew researchers found that Boomers are less likely to have been laid off or needed to search for another job during the previous year than younger generations, they are also confronting age-related limitations should these crises appear in the near future. For example, many Boomers face larger mortgages, college education for their children and even subsidies for aging parents.

The Urban Institute offers evidence supporting concerns about the big elephant in the room, age discrimination:

“Although older workers are paid more than younger workers and may be less likely to be laid off, experimental evidence suggests some employers may still discriminate on age in hiring decisions and survey evidence from the 1990s finds they are less likely to train older than younger workers.”

People in their fifties cannot as easily find other jobs after layoffs, as suggested by the Urban Institute:

“Older workers who do lose their jobs experience longer unemployment spells than their younger counterparts. In 2006, 28 percent of unemployed adults ages 55 to 64 were unemployed for at least 27 weeks, compared with just 26 percent of those ages 25 to 34 and 20 percent of those ages 35 to 44 (Bureau of Labor Statistics 2007).”

Millions of Boomers are now experiencing enormous financial and/or psychological burdens due to caretaking. Many in this generation are sandwiched between parents with failing health and adult children who have returned home as "twixters."

Not surprisingly, 76% of the Boomer generation believes it is easier to fall behind than it was ten years ago, and a mind-boggling 86% say it is harder than it used to be to keep up a middle-class lifestyle (versus 77% of younger people and 72% of older).

A deep glumness based on real issues confronts the generation. And some pessimism may be grounded in more ephemeral factors beyond economics.

We live in a youth-centric culture, thanks in part to the influence of Boomers when they were young. Marketers and members of the media communicate hundreds of messages every day that associate aging with loss, decline and lesser social value. This has been a longstanding tradition in this country and now incongruent with demographic reality. It's difficult for members of such a vital and engaged generation to accept being marginalized.

This is a time of enormous cultural and sociological transformation as nearly one in three American adults has passed the threshold of 50. The nation is just beginning to adjust to an unprecedented era when the old outnumber the young, and the pressures fomented by this adaptation are falling squarely on the shoulders of the Boomer generation.

In the short term, these are pretty gloomy realities. And new research is bearing this out.

Professor Randy Pausch, A Lecture, A Gift for Boomers

The sad news has arrived. Professor Randy Pausch succumbed to the ravages of pancreatic cancer after a noble fight and a noteworthy battle to make the world aware of the disease that killed him. As he wisely observed, pancreatic cancer does not have a celebrity spokesperson because its victims do not live long enough. So, during the last ten months, he had become an accidental national celebrity for an engaging "last lecture" and as an intrepid crusader to fight this disease, even though his own demise was inevitable.

For those of you unfamiliar with Dr. Pausch, he was Professor of Computer Science, Human-Computer Interaction and Design at Carnegie Mellon University. He was diagnosed with pancreatic cancer in August 2006, undertook aggressive chemotherapies and radiation treatments, but a year later his cancer had metastasized to his liver and spleen. According to his doctors then, he had but three to six months of functional health remaining.

Carnegie Mellon, as well as other universities, has a tradition called "The Last Lecture." The context is simple but inspiring: What if you have but one last chance to share your experiences and wisdom with others? What enduring values, lessons and ideas would you communicate if this is your final chance?

Professor Pausch, who I will refer to as Randy, gave his last lecture in September 2007, but of course it was not a hypothetical lecture framework in his case. It was reality; he was dying. But the lecture is not about dying; it is about really achieving your childhood dreams. Randy presented his lecture with enthusiasm, humor, humility and clarity.

A videotaped recording of this lecture ended up on YouTube, and millions have watched it. Randy appeared on Oprah's daytime television show and gave a condensed version of the lecture. Jeffrey Zaslow with the Wall Street Journal, who had attended the live lecture, worked with Randy to write and publish a small book of wisdom and motivational encouragement, also called "The Last Lecture." (I wrote the third posted review of this book on Amazon.com.) The book topped bestseller lists for weeks following its release in April.

Defying the odds against him, Randy nevertheless lived long enough to see his lecture become a worldwide phenomenon, to watch his book soar to heights of publishing success, to appear on ABC network in an hour-long special with Diane Sawyer, to appear on The Oprah Winfrey Show with eleven precious minutes to communicate his powerful messages, to testify before Congress about the need for research into preventing and curing this horrific disease, to give an address in May for the 2008 Carnegie Mellon graduating class, and, finally, to keep his admirers informed about his journey through a personal website.

Randy wasn't just a dedicated professor, a father of three small children, a husband very much in love with his wife Jai, and a valient crusader for those afflicted by fatal diseases. At 47, he was also a young Boomer man who has given us a glimpse of how an optimistic generation will tackle the final challenges of mortality and eventual dying.

Through his brave journey he demonstrated the many ways that this next generation of aging mortals will confront the inevitable: by communicating new narratives about the value of human life, by showing how one's final months can be dedicated to sharing timeless wisdom with children and young people, by not going quietly into that dark night.

Randy spent his final days under hospice care, a noble organization that gives the truest context for reconciliation, remembrance, communication, acceptance and dignity. (I had the immense privilege of addressing the nation's hospice CEO's at Duke University in October 2006 as part of a meeting of the National Hospice Work Group. I also participated in a PBS special focusing on hospice, which will be released in August.)

In pondering how a generation will change dying in the most constructive ways, I realized that those Boomers who address the challenges of a slow dying process will likely choose to die the way they've lived: idealistically, intensely and intently focused on creating a legacy for those who survive. Many will follow in Randy's footsteps. They will give new meaning to the end of our mortal journeys, leaving behind a wiser nation.

Maybe they will help our fragile species finally understand and accept that human life is precious and each person, given the proper context, can contribute meaningfully to our collective journey, even in the final days.

REI, Authenticity and Boomers

Several years ago, I wrote a blog posting about REI and Jilted Boomers. The thrust of my post was to harangue REI for consistently depicting its customers as exclusively under age 40. They do this throughout their catalogs and wall graphics hanging in their Denver "flagship store."

Here's a little back-story. As the Program Committee chair for Rocky Mountain Direct Marketing Association (RMDMA) in 2005, I planned a major event featuring noted marketing professionals. Our keynote speaker was Joe Pine, author of The Experience Economy and Authenticity. Atsuko Tamura, senior vice president of marketing for Recreational Equipment Incorporated, also graciously agreed to speak.

I was pumped up about this speaker line-up. You see, I'm the paradigmatic REI customer. My co-op membership number is 288,XXX, which means I've been buying stuff from REI since about 1970. I've purchased more backpacking and camping equipment through their catalogs than I can ever use. I've already shopped at REI three times this year (which is infrequent for me), dropping a few hundred more dollars on equipment I don't really need (but badly want). Their flagship store in Denver is an experience-seeker's dream-come-true with all kinds of cool and interactive ways to play with the toys before buying.

I was thrilled to be hosting a marketing thought-leader with two bestselling business books to his credit and a senior marketing executive representing my favorite outdoor equipment retailer.

Here's the problem. Several weeks before Atsuko and Joe arrived in Denver, Business Week interviewed me concerning the Boomer business opportunity. When asked to cite some companies that target Boomers but are not effectively reaching out to this market with marketing communications, I mentioned REI. That article appeared about ten days before the big event in Denver.

About a week before the event, I received an email note from REI's Public Relations Manager, with the following comments:

A story in the current issue of Business Week magazine has generated quite a bit of comment around my office, and when I took a closer look I noticed that you were quoted. The part of the article that has my colleagues talking is the implication that REI doesn't understand the importance of the aging population — and I've been encouraged to write a letter to the editor to set the record straight that not only do we recognize the importance of this segment, but that a significant portion of our customer base falls within this category. As such, I'm curious to know if it's your opinion (as a loyal REI member) that we don't place importance on this segment of our population, or if the reference to REI is an editorial comment from the reporter?

Oops.

Why did I skewer REI, one of my personal favorites? You see, I had studied REI catalogs for several years and noticed that they never used older models. Marketing management carefully balances ethnicity and gender throughout their catalogs, but they almost never show older customers — not just Boomers but even members of the Silent Generation and GI Generation. I took the initiative to write the former REI CEO to make him aware of this obvious oversight.

The subject of my comments to Business Week never came up during the visit. However, Atsuko did tell me one important factoid: Boomers represent around 27% of REI's business. I suspect it is even higher in Denver because this city has the highest Boomer percentage of any major city in the country. In fact, you could say that Denver is the "Boomer Capital of the United States."

If you wander through REI's hallowed Denver flagship you'll see lots of photos like this one:

If you look further, you'll also see a wide diversity of employees, including one graying rock climbing instructor:

Since I wrote the first blog posting about REI in 2005, I've continued to watch their catalogs closely to see if they have made any changes. Once in a great while I have seen a little gray on one or two catalog models (and I'm referring to younger looking male models who might even be prematurely gray. I haven't yet seen any PrimeTime Women.)

Today I sorted through my mail to discover one of my favorite direct mail gifts: REI's summer 2008 catalog. It's graphically inspired but does not have a single photo of a Boomer or someone older ... not one. REI's creative team might defend this because the summer catalog has a distinctly "young family" theme. With respect to this creative decision, I ask, "What about grandparents?" How many Boomer grandparents buy outdoor equipment and share the majesty of natural spaces with their children and grandchildren? Could this be a market worth targeting and developing?

About 28 million Boomers are now grandparents, representing 36% of the generation. Over three million more Boomers will become first-time grandparents this year. They spend lavishly on their grandchildren, not only because that's what grandparents tend to do, but because thoughtful gifts teach core values.

For example, two months ago I gave my neighbor's son, Ian, an REI backpack filled with the "ten essentials" for outdoor survival. Although he's not my grandson, chronologically he could be. In giving Ian this gift, I wanted to share my profound love of nature and the lessons I've learned from wilderness experiences. The backpack symbolizes values bestowed to me by my father.

Several weeks ago, I read blog postings by my colleague Marilynn Mobley, who writes Baby Boomer Insights. It's a good place to find interesting commentary about this dynamic (and challenging) market. She attended the JWT LiveWire Summit in San Francisco last month where Joe Pine discussed concepts from his newest book, Authenticity. As Marilynn reported, "Joe asked audience members to name brands they connected to because they believed the brands were authentic." One brand at the top of the list: REI. (This is an ironic nomination at a conference populated by those dedicated to advancing perceptions and practices of mature marketing. But sometimes these details can be elusive, even to professionals.)

I'm having a problem with REI's authenticity when the company steadfastly refuses to reflect the true diversity of its customer base through marketing communications. I might be the only customer in the world concerned that REI appears to be ageist, but revolutions in social thought and business practice need to start somewhere. (Thank you, Betty Friedan.)

Boomers' money and loyalty built REI into today's outdoor equipment retailing powerhouse. Failure to include these loyal customers in marketing communications is, well, disingenuous.

P.S. I thought you might appreciate this link to the photo of REI's Board of Directors. Clearly and ironically, the majority are Boomers.

P.P.S. You'll need 20-year-old eyes or serious magnifying eyeglasses to read the 8 or 9 pt. sans serif font used throughout REI's summer catalog.

Footnote: A sweeping article in Advertising Age, entitled "Changing Face of the Consumer" and written by my colleague Peter Francese (formerly founder of American Demographics magazine), included the following observation:

The average U.S. head of household is now nearly 50 years old (49.5, to be precise). But here's the bigger story: More than 80% of the growth in the number of households in the next five years will be among those headed by people 55 and older. That's pretty scary stuff for the youth-obsessed.

Update July 9: I visited REI.com today to purchase a birthday gift certificate for my niece Heidi, a tradition I've honored for many years. Out of curiosity, I visited every product category page on the website. (Those can be found in the column of hyperlinks on the left-hand side of the home page.) Each category section leads off with a photo and a block of copy in a yellow rectangle. Out of perhaps 50 pages, I found one page, for backpacks, with a photo depicting someone maybe over 40.