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Long-standing human resource practices invest heavily in youth and push out older workers. This must change—and public policy, too—or companies will find themselves running off a demographic cliff as baby boomers age. The general population is aging and with it, the labor pool. People are living longer, healthier lives, and the birthrate is at a historical low. The Bureau of Labor Statistics projects a shortfall of 10 million workers in the United States inand in countries where the birthrate is well below the population replacement level particularly in Western Europethe shortage will hit sooner, be more severe, and remain chronic.
Skills, knowledge, experience, and relationships walk out the door every time somebody retires—and they take time and money to replace. And while the brain drain is beginning now, the problem is going to become much more acute in the next decade or so, when baby boomers—more than one-quarter of all Americans, amounting to 76 million people—start hitting their mid sixties.
Based on the of their yearlong research project, the authors of this article offer recommendations for gaining the loyalty of older workers and creating a more flexible approach to retirement that allows people to continue contributing well into their sixties and seventies. Companies can no longer afford to think of retirement as a onetime event, permanently dividing work life from leisure.
Your company faces a looming threat to its competitiveness: a severe shortage of talented workers. New workers will be harder to come by. The valuable skills, tacit knowledge, and relationships that older workers have accumulated will melt away from your organization. How to prevent mass retirement from starving your business of talent? Replace the traditional notion of retirement—whereby people stop working at a certain age—with a more flexible one that encourages people to become lifelong contributors to your company.
Develop retention programs that reengage baby boomers—such as flexible work arrangements, asments that help them master new skills, and opportunities to take on part-time contracting work after they retire. They hunger to learn, grow, and try new things. Retire retirement in its traditional sense, and you solidify your connection with older employees—before competitors can snap them up.
Older workers receive less than half the amount of training their younger cohorts receive. Retailer CVS has created a welcoming environment for older employees. It has no mandatory retirement age. Half of its 3, regular, full-time employees are over In the past 12 years, CVS has more than doubled its percentage of over employees.
Many mature workers want to keep working, but in a less time-consuming and pressured capacity. Offer flexible work arrangements—job sharing, telecommuting, compressed workweeks, part-time schedules—to older workers.
You and your older workers will benefit. To revive productivity, the company upgraded technology to enable some call center employees to work off-site. Then it actively recruited baby boomers to fill these jobs.
And the company was able to expand without moving into a larger, expensive facility. Some government Im town on business younger seeking older make it financially prohibitive for older workers to delay retirement in favor of flexible work arrangements.
To get around these restrictions, allow employees to take regular retirement and then, after a specified break in service, return as independent contractors working on a part-time basis. They can then work on a project-consulting basis for up to 1, hours per year at their old base salaries or less, depending on responsibilities. Eighty percent of retirees up—some starting back the day after they retire.
Most participate into their mids, some beyond The general population is aging and, with it, the labor pool. People are living longer, healthier lives, and the birthrate is at a historic low. In the United States, the overall rate of workforce growth faces a sharp drop.
Meanwhile, age distributions are shifting dramatically. As the population at large ages, and ever-more spending power is concentrated in the hands of older customers, companies will want to show a mature face to their clientele—and yet those faces will be in high demand.
The problem is pretty clear. Workers will be harder to come by. Tacit knowledge will melt steadily away from your organization. And the most dramatic shortage of workers will hit the age group associated with leadership and key customer-facing positions. The good news is that a solution is at hand: Just as companies are learning to market to an aging population, so they can also learn to attract and employ older workers. And yet, despite irrefutable evidence of workforce aging, many managers may be marching their companies straight off a demographic cliff.
These employees are bottlenecked, with too many people competing for too few leadership positions. Meanwhile, they stand back and watch as recruiting, training, and leadership development dollars, as well as promotion opportunities, are overwhelmingly directed at younger employees, with little thought to the skills and experience that the over crowd can bring to bear on almost any business problem.
In short, most baby boomers want to continue working—and they may need to, for financial reasons—but they may not want to work for you. Among those age 55 and older who accepted early retirement offers, one-third have gone back to work. Most baby boomers want to continue working—and they may need to, for financial reasons—but they may not want to work for you.
We recently conducted a yearlong research project in which we looked at the implications for businesses of an aging workforce. Broadly speaking, our findings suggest an urgent need to find ways to attract and retain employees of all ages. But of most concern is the potentially debilitating mass retirement that threatens to starve many businesses of key talent in the next ten to 15 years.
Sponsored by 30 major public and private organizations in North America and Europe, the project explored the emerging business challenges presented by workforce aging and other profound shifts in workforce demographics. On the basis of our findings, we developed a series of management actions and pragmatic techniques for anticipating, coping with, and capitalizing on those changes.
Member organizations shaped the focus and direction of the project, shared their experiences as part of the field research, and participated in a series of workshops. If companies are to win back the hearts and minds of baby boomers and other generations of mature workers, they need to start with the work environment itself, which has become increasingly alienating to anyone over the age of Human resource practices are often explicitly or implicitly biased against older workers, and these biases can seep into the culture in a manner that makes them feel unwelcome.
It starts with recruiting, in subtle ways such as the choice of words in a job advertisement. Traditional recruiting channels such as want or help wanted s may not attract older workers either. Twelve years ago, pharmacy chain CVS looked at national demographic trends and concluded that the company needed to employ a much greater of older workers.
Now the company works through the National Council on Aging, city agencies, and community organizations to find and hire productive new employees. Interviewing techniques can be unintentionally off-putting as well. Training and development activities also tend to favor younger employees. According to the Bureau of Labor Statistics, older workers age 55 plus receive on average less than half the amount of training that any of their younger cohorts receive, including workers in the 45 to 54 age range. And yet many midcareer and older employees require refresher training in areas from information technology to functional disciplines to nonhierarchical management methods.
At Dow Chemical, the companywide expectation is that employees at all levels will continue to learn and grow; as a result, employees regularly seek training and development opportunities, readying themselves for their next career moves.
Most important, mature workers will be attracted to a culture that values their experience and capabilities—an environment that can take some time and effort to build. The Aerospace Corporation is a company that has, over the years, built a reputation for valuing experience and knowledge. Nearly half of its 3, regular, full-time employees are over age 50—a clear al to job candidates that experience is appreciated.
CVS has made great strides in creating a company that is more welcoming to older employees, having more than doubled the percentage of employees over age 50 in the past 12 years. It has no mandatory retirement age, making it easy to the company at an advanced age and stay indefinitely six employees are in their nineties.
The company boosts its age-friendly image through internal and external publications. For most of history, people worked until they dropped. Older workers can see that CVS honors experience. What influenced his decision? She was recently given a year pin.
By giving Penn credit for time served before she ed the company, CVS once again sent a strong al about the value attached to experience. Companies need to de jobs such that staying on is more attractive than leaving. Many mature workers want to keep working but in a less time-consuming and pressured capacity so that they may pursue other interests.
And many baby boomers have a direct and compelling need for flexibility to accommodate multiple commitments, such as caring for children and elderly parents at the same time. The concept of flexible work is not new, of course, and many companies offer it in some form—job sharing, telecommuting, compressed workweeks, and part-time schedules. But such programs are usually small in scale and, in practice, are often taken up by new mothers and others with consuming family commitments.
Kansas City hosts some 90 call centers, so employees had numerous other options, and the applicant pool was shallow.Im town on business younger seeking older
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