First, let me tell you about my neighbors in Florence, Minnesota. Both are guys in their late 50s/early 60s, they worked hard all their lives and you can see it in their hobbled walk and limited range of motion. Neither works full time anymore as they try to scrape by on occasional work and disappearing unemployment insurance. After a lifetime of working for employers that were too cheap to provide a pension they've been cast aside to fend for themselves; If they're lucky they'll survive a few more years to collect their small social security check and finally get health insurance via Medicare.
Today I got to enjoy lunch with a group of much happier and healthier retirees- Teamsters all, retired members of Teamster Locals 289 and 471. We loaded and drove trucks delivering Wonder, Sara Lee, Earthgrains, Master, Taystee, Old Home, Emrichs, Hostess, Mickey and Egevist baked goods and some of our members processed and hauled Milk too. I hired on at Continental Baking (Wonder Bread and Hostess Cake) in 1978 and was fired by them 12 times before I quit in 1998. But due to a legal technicality that resignation is null and void, so technically I'm still an employee of what is now Hostess Brands.
But there's no job for me to return to- our Minneapolis bakery closed in 1987 and the warehouse closed in 1998. What's left is a couple depots and even they're half empty as through mismanagement the company has lost market share through the last three decades. Thus despite being only 60 I was far from being the youngest retiree there. Several of my union brothers (the company didn't hire any women Teamsters until the late 1970s, so I was the only Teamster sister present last year, this year one of the pension administrators retired so I finally had some company) who were laid off when the warehouse closed in 1998 still haven't found good permanent jobs and were forced to start collecting their pensions as soon as they became eligible at age 55. We even have one retiree who hasn't found permanent living wage work since the bakery closing in 1987, fortunately he's found self employment rehabbing housing and is now old enough for Medicare.
Good thing, because like my neighbors in Florence that were denied union protection, we have a lot of aches, pains, and worse from pushing, pulling, and lifting bakery products and milk for most of our adult life. At my table alone two of us in our 60s had already had joint replacements. And thanks to our union contracts, we can keep our health insurance when we retire, but it ain't cheap. And thanks again to our union contracts that kept us from having to sleep in the trucks we're clearly exceeding the 61 year life expectancy of over the road drivers- we had a moment of silence for the 17 of us that passed in the last year; In a pool of over 500 retirees that's a low number. I saw several seven and eight decade old teamsters, and a brother who hired on in the 1950s stopped by our table to visit. He drove about a hundred miles to the luncheon today and is still active, serving on the board of his rural electric cooperative. Contrast that with the life expectancy of 55 for the largely non union over the road drivers who are members of the Owner Operators Independent Driver's Association.
The lesson's from the retiree's luncheon? Even modest pension benefits can greatly improve the lives of seniors- we may not be rich, but we're not drowning in poverty. And despite what the sleezy promoters of the 401K and IRA industries will tell you, the cost isn't that great- the current employer contribution to our pension plan is only $100 a week, that's at most $2.50 an hour. That $5200 a year investment for 30 years provides a $36,000 a year pension for life at as early as age 55. Not a bad deal, and a cheap way for the employer to build employee loyalty and help us old slow folks retire and make way for more productive young workers.
The takeaway? Pensions are an affordable way to fight senior poverty and build a stable workforce. In the grand scheme of corporate finance pensions cost peanuts. And pensions shouldn't be just the preserve of a lucky few- every american worker deserves a pension plan!