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As the more than 76 million Baby Boomers approach retirement, an imminent talent shortage is affecting the workforce, and many U.S. companies will be challenged with a significant loss of experienced workers. This talent drain can be partially alleviated if companies entice older workers to remain in the workforce longer, according to Joan Strewler-Carter and Stephen Carter, co-founders of the Life Options Institute, an organization dedicated to helping people plan for life after age 50.
“The coming talent shortage may force employers to overcome their age bias and introduce new opportunities with which to utilize this powerful asset,” says Strewler-Carter.
More significant than the talent shortage is the looming “brain drain.”
“Few companies have solved the knowledge-transfer problem,” says Strewler-Carter. Retaining older workers, even part-time, gives them the opportunity to teach younger workers what they know. Mentoring and action-learning teams are techniques that have helped some organizations succeed in transferring knowledge.
Many experts are predicting a shortage of 10 million workers by the year 2010. By 2014, nearly 20 percent of the workforce will be comprised of people age 65 or older. This increase will make mature workers the faster-growing workforce segment, according to the U.S. Department of Labor’s Bureau of Labor Statistics.
According to the Merrill Lynch New Retirement Study published in 2006, 71 percent of Baby Boomers say they will work after retirement. The new retirement for people 60 and older won’t involve withdrawing from working life. Instead, Boomers want to find a new life balance that includes some form of employment, notes Carter.
A New Employment Paradigm
Retirement for Baby Boomers will blend work with leisure activities. The boundaries between work and play will no longer be so firm. Flexible work will become the rule. The Boomer generation will demand more autonomy, flexibility and satisfaction on the job, says Carter.
“To be more precise, the upcoming working retirees want to work on their own terms,” he says.
An option to be considered is “phased retirement,” the gradual tapering off of working hours and responsibilities, culminating in a final break from the company. This period of phased employment can extend for years, describes Strewler-Carter.
Although workers age 50 and older want to work, many don’t want full-time employment. Some corporate trendsetters are experimenting with phased retirement – continuing to work for the same employer but with reduced hours, says Strewler-Carter.
She states that there are several companies that have already developed cutting-edge programs. For example, Procter & Gamble developed its own job site, www.YourEncore.com, as a way to attract its retired employees. General Electric allows retired employees to work up to 1,000 hours per year.
IBM has designed several programs to leverage the knowledge and expertise of retiring Baby Boomers. The company maintains a pool of retirees who mentor and transfer knowledge to younger workers.
San Diego-based Sharp HealthCare has its older employees determine their preferred work schedule.
Home Depot allows employees to set their work hours. In addition, it has trained managers in how to deal effectively with older workers.
The Boomerang Year
“A variation on phased retirement is the ‘boomerang year’ in which people take off a year or two before transitioning into a period of their lives when they may mix part-time work with leisure activities,” says Carter.
According to Carter, some corporations have already developed programs that adapt to the boomerang concept. Traveler’s Group allows older employees who have taken a year or more off the ability to return on a part-time basis without adversely affecting their pensions.
Polaroid offers older employees the opportunity to take a leave of absence for up to six months and either return to their job or to a part-time version.
Monsanto allows employees to retire for a few months up to a few years, and then return to the company in a part-time capacity.
Innovation is not tied to younger workers. More mature workers can innovate as well. The challenge for employers will be to create cultures that engage people and motivate performance. Companies that are successful in renewing their human capital will win.
For additional information, visit www.WhatsNextinYourLife.com, a Web site from Life Options Institute that helps people plans for life after 50 and includes helpful information on how to remain or re-enter the workforce.