According to urban legend, no one in his final days states, “I wish that I had spent more time in the office.” Ah, but in the years to come, Baby Boomers may say in the decades before those final days, “I am glad that I stayed longer in the workforce.”
So, are you ready for the Silver Tsunami (a.k.a. the baby boomers greying) at your workplace? If not, you should be.
- As the first members of the largest cohort of Americans (i.e., the Baby Boomers) start turning the formerly magic age of 65, they are facing longer life spans than ever before. According to AARP, a US man who hits 65 has a life expectancy of 84 and a woman has one of 86. Thus, they have a 50% chance of living for the equivalent of more than half of their working lives.
- They will need a lot of money for these golden years. Many don’t have it. Far fewer Baby Boomers will have the pensions of the WW II/Silent Generation. They will have to rely on Social Security (they hope) and their savings. And one in two workers age 51 to 64 does not have $250, 000 in retirement savings. Thus, it’s not surprising that 50% of these same workers plan on working past the traditional retirement age.
- They actually already are working past 65. After decades of falling participation of this age group in the workforce-the percentage of men fell from 47 percent in 1949 to 15.6 percent in 1993-the trend reversed. Between 1993 and 2011, labor force participation increased in this demographic by 47%. Today approximately one-third of all men between 65 and 69 work.
But after decades of phasing out older and more expensive workers with layoffs and early retirement plans, are companies ready for this great big silver wave? Well, if they aren’t today, they will need to be in the near future. Why?
- American companies are facing a labor shortage. By 2020, there will be approximately 165 million jobs in the United States. According to a study by Georgetown University, the shortage will be at least 5 million jobs, as not enough individuals will have the appropriate skills to fill them. In certain industries, the situation will be critical. For example, the Oil & Gas sector could lose 50% of its management to retirement over the next decade.
- American companies will require a more skilled, educated labor force in the near future. Of those nearly 165 million jobs in 2020, 65% will require some type of post secondary school education, up from 59% in 2010. For information technology and government, 80% of the positions will require education beyond high school. The educated Baby Boomers will be needed to fill a number of those jobs, albeit with training in some of them.
- American companies are facing a knowledge drain. As far back as 2007, an Ernst & Young survey found that 68% of Fortune 1000 companies considered “maintaining intellectual capital” to be their greatest organizational risk and 62% said the impending retirements will create a “brain drain” within their organizations. In a more recent SHRM and AARP poll, 72% of HR professionals said loss of talented older workers was a “problem” or a “potential problem.” Yet only 5% had implemented policies and practices to address the situation.
Knowledge is becoming the most prized commodity in this workforce. All generations will need to acquire, understand, share and build on all types of knowledge. They will need knowledge to better understand their existing jobs, to acquire skills for new positions, to move their companies forward and to continue competing in the 21st century. In this environment, companies must view their workforce in a holistic, non-stratified way. Yes, the 21st century workforce is and will become more racially, ethnically, nationally, gender and age diverse. But companies will only succeed if they can blend that diversity into a multi-national, multi-racial, multi-generational whole.
So how can knowledge be retained in the organization? How can organizations help close the skills gap with this cohort? It’s not enough just to keep or hire more seasoned workers. Programs, initiatives and structures must be in place to ensure that their existing knowledge is unlocked and shared as well as helping them to acquire new skills. Some interesting initiatives have already been implemented.
- According to the Deloitte Report Talent 2020, Oil & Gas companies are looking at a series of retention moves for older employees including flexible work arrangements, additional bonuses, changing job statuses (e.g., going part-time) and mentoring younger workers. Most likely, companies will start offering “late retirement packages” to baby boomers they way that they gave “early retirement” ones to the WW II/Silent Generation.
- Reverse mentoring (i.e., younger employees mentoring older ones) has taken hold at such companies as GE, Ogilvy and Mather, and The Hartford. In fact, employees at HP demanded it! Topics often include technology, social media and consumer culture. An unexpected benefit: some companies have found increased retention with younger workers involved in the program.
- Last September, two hundred and fifty companies, including Google, AT&T and MetLife, signed a pact with the AARP to “recognize the value of experienced workers and vowed to consider hiring older applicants.”
The MetLife Foundation has actually been funding The Council for Adult and Experiential Learning to work with community colleges across the country and address the skills gap with older workers.
Technology will play a major role in the support of these initiatives as well as the acquiring, retaining and sharing knowledge among all cohorts. Platforms such as BraveNewTalent can be used by enterprises to engage workers from all demographics to unlock, capture and acquire more knowledge around topics of mutual interest. For example, our communities can be used for retired professionals to mentor younger workers or younger ones to mentor those who wish to remain longer. Age also is the one “diverse” cohort (e.g., women, veterans) that will include nearly all of today’s workforce. After all, today’s millennials, who represent the “baby bump “ of the late 80’s and 90’s, are the silver tsunami of the 203o's. Now, will you be ready for them?