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Recently, I had one of those breakthrough conversations with a client. As we talked about his company's workforce plan, he came to the realization that they were going to suffer more than necessary once the Baby Boomers within his organization started to reach eligible retirement age. He realized that because of the way they've operated in the recent past, with no signs of change on the horizon, the Baby Boomers within his company weren't only planning to retire, but were counting down the days. I can attest to this because I can actually recall numerous conversations with managers within this organization who said they were out once they hit a specific date.
By now, most everyone has heard about how 2008 is going to be a critical year because that's the year that the first Boomers are going to start reaching 62.5 years old, the average age of retirement. For 2008 and beyond, what may very well separate the winners and the losers among companies who are demographically laden with Boomers is whether or not they are going to be able to retain these retirement-eligible workers a little longer. The winners will have a better transition plan as they adapt to the needs of the Boomers, while the losers will find themselves without the workforce and/or necessary skills to keep their operations running efficiently.
It's actually ironic that the success of companies in achieving such great turnarounds in the last four years is part of the reason 2008 could start such a devastating domino effect for the workforce. Remember when the Dow fell below 8,000 points in 2002? The Boomers weren't really thinking about retiring then. Most were wondering if retirement was going to be possible. There were layoffs going on everywhere. And, companies started on a path where they sought greater productivity and higher profits by asking workers to do more with less. And, guess what? The workforce delivered.
In conjunction with many other market factors (far beyond what I can explain), the economy has made a nice recovery, with the Dow surpassing 13,000 in April. Workers' 401(k) plans and individual portfolios have become much healthier, and people are generally more confident about their ability to afford retirement.
Unfortunately, during this stretch, many employees have felt overworked, and burnout is prevalent. As a result, retirement-eligible Boomers who choose to stay in the workforce are planning to leave their current job and start a new job or career. In fact, they are going to redefine "retirement."
Redefine retirement? What does that mean? Most companies that experience a net loss in their workforce as Boomers hit retirement age aren't going to lose their employees because they're trading in their tool box for a tackle box or golf clubs. Most companies will experience a loss because their employees will choose to retire and continue to work somewhere else. According to a 2006 study by Merrill Lynch, only 17 percent of Boomers are hoping to retire for good. The vast majority are planning to find a new balance of work and leisure. In fact, in the same survey, only 6 percent stated that they plan to work full-time. That leaves 77 percent of the respondents planning to stay in the workforce.
What’s the answer in dealing with these workers? Well, the experts are saying it’s going to come down to your ability to provide flexibility in work schedule. So, here are some initiatives you may want to consider:
1) Part-time transition: In a survey conducted by PricewaterhouseCoopers, 82 percent of respondents said that they would consider transitioning from full-time work to part-time work before retiring completely.
2) Consulting or contracting: Consider letting your workers retire under an arrangement that they would be hired back in a consulting role or on a contract basis to handle special projects.
3) Telecommuting: Consider letting your semi-retired Boomer work part of the time from a home office.
In another survey cited by Inc.com, only 25 percent of employers have done any kind of planning to handle this Baby Boomer issue. What has your organization done?
John Ha is the president of Reliability Careers, a provider of workforce solutions for the reliability and maintenance industry. This business not only provides traditional recruiting and sourcing services for companies but is dedicated to help clients with overall talent management, including recruitment and selection, performance management and coaching, and employee development and training. For individual career-seekers, the firm finds top-flight opportunities in the reliability and maintenance field. Contact John at 918-388-2438 or e-mail firstname.lastname@example.org.