Katherine Newman

Downhill from Here: Retirement Insecurity in the Age of Inequality, a new book by sociologist Katherine Newman, illuminates how millions of Americans are at risk for an old age that is far less secure than the one they expected. Pensions today cover just 10.7 percent of U.S workers, most of them in the public sector, and nearly half of all private-sector employees—some 58 million people—have no company-sponsored retirement plan. Moreover, the plans that do exist are subject to the fluctuations of the stock market and don’t provide a stable guaranteed income. The result, writes Newman, is that “the good fortune of longer lifespans is colliding with the inadequacy of the public policies we assumed would undergird financial stability in retirement.”

Newman, who in previous books explored such topics as urban poverty and school violence, interviewed three hundred people for Downhill from Here from all over the country. They include blue-collar Teamsters, professionals working for big corporations such as Verizon and United Airlines, elderly African Americans from Opelousas, Louisiana and municipal workers from Detroit and California. She interweaves vivid portraits with statistics and research studies to show that retirement insecurity cuts across class and racial lines and generations. Younger workers, in fact, may be the hardest hit. They’re not only challenged by steep student loan debt, they typically have less access to employer-sponsored retirement plans than their baby boomer parents.   

With traditional retirement becoming financially impossible, older Americans increasingly are joining what Newman calls “the gray labor force.” The income from their “encore jobs”—whether minimum-wage work at retail chains or entrepreneurial businesses they start themselves –is “a lifeline without which they couldn’t cover their bills,” she writes.

Working longer isn’t enough or possible for all older people, argues Newman, who disputes the current view that Americans should each be in charge of their retirement destiny. She describes how countries like Australia, Denmark and Canada have enacted health-care coverage and savings policies that ensure more secure retirements for their citizens and recommends that an immediate, necessary reform is to stabilize Social Security by requiring wealthy Americans to contribute more. The current cap that shields all income over $127,200 from Social Security contributions “is neither wise nor necessary,” she writes.

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This article was recommended by Carol Hymowitz, author, journalist and visiting fellow at the Stanford Center on Longevity.