Baby Boomer Brain Drain
America’s more than 76 million baby boomers—those individuals born between 1946 and 1964—are known for shaping new cultural trends in music, fashion, politics, the economy and everyday life. Think Beatlemania, bellbottoms and lava lamps. Or, smiley faces, Barbie dolls and casual chic. Now this same trendsetting generation is shifting America’s workforce by retiring and creating a business “brain drain.”
This older worker brain drain, also called “human capital flight,” leaves mega corporations to smaller businesses with a void of accumulated leadership and skills expertise. The retiring men and women who helped develop and oversee top products, equipment, marketing strategies and client relationships forge a substantial knowledge gap for companies. The years of cultivating industry networks, increasing sales and ensuring reliable service are at risk when boomers move on from their careers.
The Social Security Administration and other government sources note that over the next two decades, 10,000 baby boomers in America will retire every day, or roughly 4 million workers a year. More than half of these older, seasoned employees hold company leadership positions. Industries with greater numbers of veteran workers such as airlines, insurance, mining and utilities are facing more adverse effects of brain drain. As older, tenured employees retire, many employers are forced to rethink their entire workforce and means of doing business to fill critical positions and remain competitive in the marketplace.
“The country’s baby boomers are living longer, and many would continue in the workplace but are retiring now because they are family caregivers for aging parents, spouses or other loved ones,” said Tony Mau with Right at Home in Sioux Falls. “The win-win comes when companies retain their valued, older employees by negotiating incentives such as increased healthcare benefits, flexible hours and telecommuting.”
AARP finds that as baby boomers age, the number of potential family caregivers for older loved ones decreases. This caregiver support ratio is expected to drop to 2.9 in 2050 from 7.2 in 2010. Considering that across America in 2013, 40 million people were unpaid family caregivers, a growing number of U.S. companies are factoring in family needs in their employee retention plans.
The following are suggested solutions for businesses to consider in slowing the older worker brain drain:
Know the numbers. According to business.com, “Nearly two-thirds of Fortune 1000 companies believe they face near-term skilled labor shortages, but 68 percent of employers have not analyzed their workforce demographics and half do not track the percentage of employees eligible to retire within two years.” Companies can assess their risk of brain drain by gathering updated personnel data including age, tenure and job positions. Looking at the big picture of employees will help determine the most beneficial workforce for the right jobs over time.
Adjust work arrangements. To decrease boomer departures, companies can review their policies and schedules to accommodate greater flexibility with senior employees. What about compressed workweeks, job-sharing or part-time hours? Is working from home a doable option?
Pair senior employees with emerging leaders. Instead of being stymied as older employees prepare to retire, businesses can tap into the wealth of experience of seasoned workers by assigning them to mentor younger successors. Fortunately, the majority of up-and-coming younger employees welcome working with business veterans. Involving senior workers in new-hire and departmental trainings is a proven way to transfer workplace wisdom.
Document processes and procedures. Involving older workers in compiling a detailed company history with specifics on the business’ internal workings is essential. Another proactive step is to talk with senior employees to gather their firsthand recollections and perspectives on workflow and technical operations. Questions to ask include the following: Over the years, what were the company’s greatest challenges and how were these solved? What do you recommend as ways to improve and grow business?
As baby boomers continue an exodus from the workplace in the years ahead, many firms are hiring back long-term employees as project-based consultants to solve specific problems or work on projects that require a sought-after skill set. Companies value these experienced veterans who can hit the ground running, and boomers value the adaptable hours, extra pay and opportunity to keep engaged. Together, both businesses and long-time workers nationwide are creating beneficial ways to turn the country’s brain drain into a brain gain.