We marvel at the continuing energy of octogenarians such as Warren Buffett, Ruth Bader Ginsburg and Clint Eastwood, but let’s face it: Few 80-year-olds are as good at their jobs as they were in their 50s.

In most workplaces, wages rise with seniority, but productivity does not. In the U.S., after many years of a declining retirement age, the average worker is now retiring later, which means that there are fewer jobs for young people. Given the added fact that mandatory retirement and age discrimination are illegal, employers hesitate to hire middle-aged workers, who may stay on the job long after their pay has exceeded their productivity.

What to do about these cross-generational problems? A relatively simple set of reforms could help American businesses and workers at the same time. These would include a relaxation of age-discrimination laws, so that contracts could require workers to retire at 65 or older, and a reduction in Social Security benefits for well-paid older employees who decide to keep working.

Read more at The Wall Street Journal