As life expectancy increases, a larger proportion of older workers may desire to postpone full retirement by continuing to work either at their career jobs or by shifting to bridge jobs. This paper examines reasons why employers might adopt policies to facilitate the extension of work life or limit the ability of workers to remain on the job until older ages. Employers may be concerned about potential higher costs, lower productivity, and a suboptimal age structure of their labor force if retirement age, on average, is delayed. Employer responses will likely vary across sectors of the economy and over time with changes in economic and regulatory condition. Employer responses to the desire for older retirement ages may include redefining job conditions, levels of responsibility, and compensation for older workers to modify and reduce any negative effects of delayed retirement. Employment policies such as phased retirement and modifications of job titles and span of responsibilities can reduce negative effects on the promotional opportunities for younger workers; however age discrimination policies may restrict such changes.
