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Economic downturn casts pall over many who are set to retire

May 30, 2009|By ARNOLD S. PLATOU

Judy Kerns is feeling anxious over her decision to retire this week after 40 years in Washington County's public school system.

Mostly, she's worried about whether she will be bored, will she miss teaching and should she really give it up when she's still enjoying it so much?

But also, she's worried about the economy and whether this is really the best time to give up the security of a good job.

"I want to be able to do things when I retire. It takes money to travel, so will I be able to do that?" Kerns asked.

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"Of course, I have second thoughts about it," she said. "My tax shelter investments have gone down the tubes like everyone else's and we don't have a lot of time to make it come back."

Kerns, 61, isn't the only one with such worries this year.

A survey of 1,000 people, age 25 and up, in January found "the recession has cast a pall over the retirement expectations of the vast majority of Americans," said an official with the Employee Benefit Research Institute, a nonprofit organization based in Washington, D.C.

According to the survey, only 13 percent -- the lowest since at least 1993 -- of workers still are very confident of having enough money to live comfortably in retirement, Research Director Jack VanDerhei said at a news conference in April.

"Because of the economic downturn, many workers say they expect to work longer than they had previously planned and more workers say they are planning to supplement their income in retirement by working," he said.

One result here as elsewhere, experts say, is fewer jobs will be available for America's latest class of college graduates.

Hanging in there

That already appears to be happening in Washington County.

"We, by far, had less retirees this year," said Donna Newcomer, executive director of human resources for the county's public school system.

In all, 37 school employees are retiring this year -- about a third fewer than the 55 who retired a year ago.

"Of administrative ranks, we had one retiree (this year), whereas last year, we had three," Newcomer said. "Of the teachers, we had 25 retire this year and 32 last year. For our support staff, we had 11 retire this year compared to 20 last year.

"We know that there were folks who would have retired this year, who did not -- based on what's been happening in their investments."

To what extent that's also been happening at other large employers here isn't clear. A reporter's calls weren't returned by either a spokeswoman at Citi's 2,200-employee credit card processing operation near Hagerstown or a personnel official for Washington County's government.

But others are seeing the trend, too.

"I hear regularly from faculty who are delaying retirement because of the way that their portfolios look right now," said Suzanne Shipley, president of Shepherd University in Shepherdstown, W.Va.

In Washington County, a related trend also is becoming clear.

As job openings dwindle throughout the region, "we are seeing a huge increase in applicants," Newcomer said.

"I see applications on a daily basis and get phone calls, not only in teacher (positions), but also in our support staff," she said. Increasingly, the job candidates are "people who are way overqualified," she said.

"There were 1,100 applications for teachers last year at this time," she said. "Now, we have over 1,700 applications from folks for teachers."

She said part of the attraction probably is that the county's school system hasn't laid off workers or chopped pay raises, as some other counties in the region have had to do.

To fill the retirees' jobs plus those of workers who might move or take maternity leaves, the local school system is estimating "we may hire around 100 (teachers) this year for next year," Newcomer said. A year ago, it hired 151 new teachers, she said.

Overall, the feeling seems to be it's best to stay put in a shaky economy.

"People aren't leaving," she said. "They're holding on to their positions."

"Somebody at one time might have said, 'Things are looking pretty good (paywise) over in Pennsylvania,'" she said. "But they'd start out as low man on the totem pole and if there were financial problems there, the folks (who'd transferred in) could be the first ones to go."

The biggest chill

Diane Martin is among those who backed away from retirement this year because of the continuing economic downturn.

Martin, who teaches special education at South Hagerstown High School, has been a teacher for 31 years. She taught first in West Virginia, then in Garrett County, Md., and came here 11 years ago.

Now 53, she had planned to retire to spend more time with her elderly parents.

The economy changed her mind.

"I didn't have a lot of money invested in the market, but I did have a couple small retirement accounts that lost a good bit," Martin said.

More than that though, the biggest chill "was probably the real estate market because I have invested in a property here and was planning on selling that.

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