In a recent New Yorker cartoon, a financial planner is talking to an old man. "Have you given much thought to what kind of job you want after you retire?" the planner asks the old man. Yes, work — for many Americans — is the new retirement plan.

Americans may need or want to work longer. But do employers want older employees? The answer, unfortunately, is a tad murky, according to a new Center for Retirement Research at Boston College report. Some do and some don't.

Specifically, small employers, those with 100 or fewer employees, and large employers, those with 1,000 or more employees, as well as "young" organizations are generally less fond of older workers be they white-collar or rank-and-file.

Employers overall view older workers — white-collar more so than blue collar — as equally if not more productive than younger workers and "more attractive" or "equally attractive" than younger workers.

The problem is that what employers say to survey takers and what they do may be two different things. Indeed, the report cautioned that there is no connection between employer attitudes and actual personnel decisions. The report said employers often examine less a person's age and more other factors such as "trainability" and potential length of service. Read the report here.

Positives and negatives

What do older employers have over younger employees? Employers cite the following advantages: knowledge of procedures and other job aspects and ability to interact with customers. That older workers are more productivity than younger workers is not surprising to some experts.

"Our research shows that older workers are, indeed, more satisfied with their jobs, better adjusted on the job, and more engaged in their work and with their employers than the young or midcareer cohorts are," Bob Morison, executive vice president of The Concours Group, a consulting firm that works with older executives, said in an e-mail. "Factor in experience as well, and that translates into higher productivity.

Employers did, however, say younger workers have it all over older workers when it comes to expectations for how much longer workers will be working.

The not-so-good news is this: Older workers may be equally or more productive, but employers also seem them as expensive. In fact, four in 10 employers say older workers are more expensive than someone younger. Morison thinks that's simply a case of getting what you pay for.

"If you're paying for skills applied and performance, then you get what you pay for," he said. "Older workers often justifiably cost more in salary. If pay is based predominantly on seniority, then older workers may be overpaid — and should be willing to take a realistic cut in pay if they choose to work in retirement."

The Boston College report also suggested that older rank-and-file workers will have a tougher go extending their careers than white-collar workers. For instance, 20% of employers said older workers who use their brawn more than their brains at work are less productive than younger workers.

Potential to keep going

In the main, the report suggests older workers have reasonably good prospects for extending their work careers. "It will not be easy for older workers to extend their careers" the report states. "But ... the potential exists."

Making the potential a reality will require some compromise and retooling, say experts.

"Undoubtedly there is still a lot of work to do," Tamara Erickson, president of The Concours Institute and co-author of "Workforce Crisis," said in an e-mail. "Companies need to revise many of their existing policies and programs to create a work force that is both enticing and engaging for older workers. Pension policies may need to be rewritten, work arrangement made more flexible, new recruiting pipelines established, supplemental training programs added, and so on."

The other good news for older workers: Employers may have no choice but to hire older workers at some point.

"Our work points to the unavoidable conclusion that corporations will need older workers over the upcoming decade," Erickson. "There simply won't be enough people under our current views of 'retirement age' with the skills required by our businesses, particularly in the areas of science, engineering and math. Tapping individuals who are 65 and above, will be key... Logic dictates that companies will soon realize this situation."

Arthur Koff of RetiredBrains, a Web-based job service for older workers, said older workers might, for instance, have to accept lower pay or part-time work to stay employed.

"Many employers are hiring older workers on a part-time, temporary or project-assignment basis and not necessarily full-time," he said in an e-mail. "This means that not only do they get employees who need less training and are generally more reliable that their younger counterparts, but employers rarely have to pay benefits, unless they are hired 30 hours a week or there is a union issue, and often pay an hourly rate or a project-basis rate that is far less than what these workers were earning when they worked full-time."

In addition, older workers might have to seek out midsize employers. Unfortunately, midsize firms represent just 25 percent of total employment, so pickings may be slim.

Health costs an issue

Morison said employers could reduce the cost of hiring older workers if they focus on Medicare-eligible prospects.

"The cost picture changes dramatically for working retirees who have reached the Medicare eligibility age or who have already retired with health benefits covered," he said. "Providing a bit of supplemental coverage for workers in this category is much cheaper than providing more extensive benefits to younger employees. A smart company hires the other guy's well-benefited retirees."

In addition, older blue-collar workers should consider retooling their skills and experience to land a white-collar job, given the better overall prospects for that type of worker.

"The demand for unskilled labor is pretty flat, but that for skilled labor continues to rise," Morison said. "The skilled and educated worker of any age is going to be in demand."

Copyright (c) 2006 MarketWatch, Inc.