There is a lot of concern over the state of the U.S. health care system, but there is another crisis brewing that anyone who manages workers—or who works, for that matter—can’t afford to ignore. In the next several years, more and more employees are going to find that they can’t afford to retire.

As Teresa Ghilarducci notes in her most recent book, When I’m Sixty-Four: The Plot against Pensions and the Plan to Save Them, retirement is a generally accepted part of the American Dream. After years of working hard, we will all be able to retire and enjoy a period of leisure before we die.

But this period of relaxation apparently is getting shorter and shorter. By 2010, 65-year-olds will be living longer than ever before. However, their expected months in retirement will fall by 14 percent, Ghilarducci writes.

So the good news is people are living longer, but the bad news is they are going to be working longer too.

Ghilarducci goes into great detail about why this is happening. She largely attributes the problem of inadequate retirement funds to the switch from defined-benefit plans to 401(k) plans.

There are lots of problems with 401(k)s, and many of Ghilarducci’s criticisms are not new, although I feel like they have been muffled a bit by the passage of the Pension Protection Act. The act, which took effect in 2007, encourages companies to put their 401(k)s on auto-pilot, so that employees are automatically enrolled in the plans. Most often these employees are enrolled into target-date funds, which reallocate to more conservative investments as the employee gets closer to retirement. Saving, and saving right, becomes a no-brainer. Or so the theory goes.

However the Pension Protection Act doesn’t solve all of the problems, and Ghilarducci notes many of the ones that remain. First, even with automatic enrollment, too often employees don’t contribute enough to their 401(k)s. Many times when workers switch jobs, they cash out their plans—causing another hit to their retirement savings. Many low-income workers don’t contribute to these plans at all. And nothing in the act addresses a major issue for retirees: how to make sure they don’t outlive their savings.

Those are just some of the concerns that Ghilarducci has about 401(k)s. Although many of these issues have been brought up by critics before, she does have some interesting theories on why 401(k)s have replaced traditional defined-benefit plans as the primary retirement savings vehicle at most companies.

Ghilarducci rejects two commonly held beliefs about this shift: that employees prefer 401(k)s and that pension plans cause companies to get into financial trouble.

On the first issue, the accepted notion is that 401(k)s make better sense for today’s workers, who are much more mobile than the lifers of 20 or 30 years ago. 

However, Ghilarducci provides evidence showing that workers don’t switch jobs as much as some of the hype would have us believe.

She cites statistics showing that the percentage of employees with more than 10 years of service in one job increased from 1996 to 2004—from 30.4 percent to 30.6 percent for men and from 27.9 percent to 28.6 percent for women.

Ghilarducci also doesn’t believe that defined-benefit plans are the reason that so many companies recently have declared bankruptcy. She argues that these companies were already well down that path to begin with, even if they didn’t have a pension plan.

According to Ghilarducci, the real reason that companies are shifting to 401(k)s is because the plans are better for employers—they take on less risk and less cost.

Again, that’s not a new argument, but Ghilarducci comes up with an interesting twist that I hadn’t heard before: She points out that companies can use 401(k) plans to reward their most productive employees. Ghilarducci cites research showing that productive employees are the most likely to contribute to their 401(k) plans, and thus receive the employer match.

“This in turn means that the employer is paying a higher wage to the most productive worker, which makes sense economically,” Ghilarducci writes. “In these ways, 401(k) plans not only reduce pension costs but are also clearly efficient forms of compensation.”

She goes a step further to imply that employers are setting up this whole system and promoting this culture of working in retirement because it suits their own needs.

Ghilarducci argues that the more retirees that continue to work, the greater the labor pool and thus the less pressure there is on employers to raise wages. “Working ‘retirees’ help manufacture healthy profits.”

OK, so it’s in the best interest for employers to keep us working, and it looks like many of us are going to have to anyway. So what’s working America to do?

Ghilarducci has an answer: guaranteed retirement accounts, which would be mandatory retirement savings accounts managed by the Social Security Administration and invested by the Thrift Savings Plan. Basically, employees would be required to contribute 5 percent of their earnings, which can be split with their employers, and instead of the contributions being tax-deferred, employees would receive a $600 tax credit. While 401(k) plans and their tax breaks could be maintained (because many high-income employees would still want them), Ghilarducci estimates that the guaranteed accounts, along with Social Security, could allow employees to retire when they want to and have 70 percent of their pre-retirement income.

Ghilarducci’s proposal is a bit more complex and has some nuances, but it’s very interesting and definitely something worth further examination.

I am not sure how feasible her idea is, given the heavily entrenched interests in the 401(k) industry (financial services companies, consultants, etc.). But again, I think the point is that the Pension Protection Act didn’t solve all of our retirement savings issues. It just shaved a little off the tip of the iceberg.

And although many employers may be concerned about the pending talent shortage, I very much doubt they want to retain disgruntled retirees who are working only because they have to.

Any time of the year, HR is among the toughest jobs out there—psychically, anyway. But the holidays, as they are collectively called in PC land, might be the worst time of year for the profession: It’s raise time, bonus time, spend-your-vacation-days-or-else time and, perhaps worst of all, office party time. I can’t begin to count how many press releases we get at Workforce Management about how HR should prevent and police bad party behavior. Lucky you.

One office party press release I got was connected to a new book, Office Mate: The Employee Handbook for Finding–and Managing–Romance on the Job. The blurb on the back of the advance reading copy (but not the final version, interestingly) says: “The best place to find a guy could be the watercooler.”

Don’t you want to gouge your eyes out just reading that? Then imagine the reaction among HR people at the American Red Cross, or Boeing, or any of the other companies that have seen their morale, fundraising and maybe even stock price brought low by such romances. (It’s interesting to me that this book is very much geared to women. Maybe the men don’t need the tutorial. Or maybe they’re just looking for playmates, not office mates.)

To their credit, authors Stephanie Losee and Helaine Olen have a chapter called “Don’t Go There,” explaining why sleeping with a married colleague is a bad idea. Chapter 2 is all about HR and is subtitled “Why you should love and adore human resources even though they’re always sending you all those annoying memos.” I’ll let you be the judge of the authors’ “takeaways” from the chapter:

• Human Resources, in Office Mate-ese, translates to “matchmaker.”
• Human Resources professionals are rarely opposed to interoffice dating, contrary to popular opinion.
• As invisible as they seem in the process, your friendly neighborhood Human Resources person is the first person you should thank when you find love at the office.

Anyway, in the spirit of the season, the authors are offering employees tips on how to pursue romance at your holiday party. They give 10 pointers—I’ll edit it to five:

• Don’t indicate your interest in a colleague at the office holiday party. An average happy hour on an average Friday night when the work gang heads to a bar together is a much better time. The entire firm isn’t present. And if you’re rejected, you can leave.
• That goes double for your boss. No, triple. Your boss is there to relax with colleagues, not fend off requests for raises or juicy assignments or—heaven forbid—advances from a subordinate who has decided the time is right to reveal a long-simmering crush.
• Don’t dress sexy. There’s no conceivable benefit to showing more flesh than you would on any other day. Dress up; don’t wear a neckline that’s, well, down.
• Don’t go home with a co-worker. Your career is at stake here. The office is a great place to meet your partner in life. Not a sex partner of the one-night variety.
• Don’t be the last one to leave. Be an adult. Dress beautifully but demurely, stop drinking after you’ve downed half of whatever someone hands you when you walk in the door. Don’t close down the place.

Not bad advice, really.  If your employees listen up, the tips might save you from having to clean up after a failed-romance debacle—either literally or legally. But I can’t vouch for what might happen at your organization in 2008 if your employees all read Office Mate between now and the end of the year.