Economy Threatened By Baby Boomer Retirement

ITHACA, NY — As millions of baby boomers prepare to retire, “the inevitable talent drain threatens to alter the national economy,” said Ithaca College sociologist Stephen Sweet, referring to a recent report he coauthored, released by the Sloan Center on Aging & Work at Boston College. “Cracks have appeared in the foundation of the economy and the workforce is getting older.”The report — The Pressures of Talent Management — examined talent management practices at 696 organizations across the 10 leading sectors of the economy. The companies studied employ more than one million workers combined and represent businesses that account for roughly 85 percent of the jobs and payrolls in the U.S.“Four of every ten employers surveyed anticipate the aging workforce will have a negative impact on their business over the next three years,” said Sweet.In 2000, baby boomers represented the largest portion of the U.S. labor force at 48 percent. By 2010, they’re projected to shrink to 37 percent of the workforce, leading some economists to predict a shortage of 10-15 million workers in the coming decade, with a disproportionate number of inexperienced workers in the overall dwindling labor pool. The retirement boom affects staffing leadership and training as well as overall continuity and engagement within the workforce.”The out-migration of a generation of workers will upset the entire balance of the workplace,” said co-author Marcie Pitt-Catsouphes, director of the Sloan Center on Aging & Work. “U.S. companies need to start planning strategically for workforce sustainability. The current abundance of older worker talent and experience is going to dry up, and businesses will very soon need to fill hundreds, if not thousands, of jobs.”Though long-predicted, the threat of workforce shortages has met with limited planning response from organizations. Realizing that some older workers want to work longer but more on their own terms to fit their changing lifestyles, some organizations created programs to improve employee engagement and productivity, and have a measured way to manage knowledge transfer. Those who heeded the warning and began adapting have a huge potential for a competitive edge. “Workforce planning makes good business sense,” said Sweet. “Changing age demographics don’t have to disrupt a business — they may present new opportunities or competitive advantages. Employers should take advantage of programs designed to meet the evolving needs of employees nearing retirement, while at the same time meeting business needs by keeping experienced talent longer and ensuring business continuity.”Additional key findings include:* 77 percent of employers surveyed had not analyzed projected employee retirement rates or assessed employee career plans.* 56 percent of these businesses had not assessed the skills their organizations need today and in the future.* About one-third of employers reported not having enough programs for recruitment or training of older workers.An associate professor of sociology at Ithaca College, Sweet studies the intersections between work, family and community. His most recent book, “Changing Contours of Work: Jobs and Opportunities in the New Economy,” examines how economic transformations are reshaping work opportunities in the United States.

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