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NEW YORK NEW YORK – Older folk and recession

Tony Best

NEW YORK NEW YORK – Older folk and recession

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ECONOMIC RECESSIONS conjure up images of severe job losses, falling housing values, foreclosures and general uncertainty about the future.
That’s the picture that is being painted of the situation in the United States, Barbados, Britain, Jamaica and other countries around the world.
Consider what’s happening with middle class housing in Barbados.
“Under the present circumstances, it is not possible to produce a product that comes within the range of the average-income person” in Barbados, Stanton Gittens, managing director of Ideal Homes, told the Business Authority as he surveyed the housing market in the country.
Edward Barrow of PDL Construction went a step further when he told the NATION’s business weekly paper that a “lot of people are skeptical about their jobs, so a lot of them are not going for a mortgage at this point”.
Bajans and other West Indians, indeed people across the United States, share that scepticism and it’s particularly rampant among people in the 50-plus age group, who have seen their retirement nest eggs dwindle.
“Many older Americans have been buffeted by skyrocketing health care costs, dwindling home values, shrinking pension and investment portfolios and employment struggles,” said John Rother, executive of the American Association of Retired Persons (AARP), the United States equivalent of the Barbados Association of Retired Persons.
And even if they happen to be employed, people realize they are not immune to the negative effects of the recession, which began in 2007 and technically ended in 2009.
One such person in New York is Maria, a Bajan in her 50s in New York City, who worries every day if she will have a job tomorrow.
“I have never seen it like this since I came to the United States from Barbados more than 25 years ago,” she said. “What makes it so tough on people my age is that you realize that companies and indeed governments at the state and local levels are always looking to cut costs and my employer isn’t any different.
“That increases the pressure on you. I know my salary is high, much higher than what a younger person would accept and you fear that you would be laid off and then can’t find work because of age and salary expectations.”
The results of a recent AARP national survey of more than 5 000 people support the Bajan immigrant’s assessment:
Workers over 50 years old are pessimistic about retirement because of the financial pain they suffered after the recession struck home.
 One person in four older people spent all of his or her retirement savings in order to get through the recession.
Almost 53 per cent of people 55 and older said that their family’s financial well-being was either fair or poor. An equal number said they were less financially secure today than two years ago.
 Almost 13 per cent of people in the 50-plus bracket had lost their health insurance and 49.5 per cent delayed medical and dental care because of financial troubles.
Almost 14 per cent had to start collecting their Social Security retirement benefits – the equivalent of the National Insurance in Barbados – earlier than they had planned and were therefore taking home much less than they would have if they had delayed it until age 66.
 Overall more than half, 52.6 per cent, were “not too or not at all confident” that they, along with their spouse or partner would have enough to live on comfortably through their retirement.
More than 40 per cent believed their standard of living would be worse in retirement than that of their parents.
“In brief, the recession and its aftermath have not been easy on middle-aged and older Americans and the future is the big question mark for many of them,” stated AARP.
How then are people, Bajans among them, coping? How are they making ends meet in the tough economic environment?
“We are cutting back on what we spend,” said Maria. “It’s that simple.”
Her response matches the reaction of almost 70 per cent of people in the AARP study. They are dining out less; going to movies less; reducing their health insurance costs; 56 per cent were withdrawing money from savings accounts; and 36 per cent were cutting the amount they are setting aside to live on when they retire.
The health care issue in the United States is more of a hot button question for Bajans in the United States than it is for their relatives back home. That’s because they receive free medical care and medication in Barbados.
So at least in one area, universal health care, people in Barbados may be somewhat better off than their cousins in the United States.