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In these times of downsizing and 6% unemployment, it's hard to imagine a worker shortage. But that's exactly what some companies will face by the end of the decade, and now is the time to start making plans for it.
Baby boomers—the 78 million people born between 1946 and 1964—will start calling it quits within five years, with retirements peaking in 2015. The smaller Generation X—only about 45 million strong—can't fill all those baby-boomer shoes, and if the Bureau of Labor Statistics is correct in predicting 22 million additional jobs by 2010, we'll face a major shortage of experienced workers.
Likely to be hit hard if they don't prepare are pharmaceutical, health care, aerospace, utility and old-line manufacturing companies, all of which grew in size decades ago and are now filled with large baby-boomer workforces.
Pepco, a Washington, D.C.-area power company, has a workforce that's fairly typical for a utility. One-third of its 2500 workers are over 50 years old. On average, workers have 18 years of experience, and their pension plan encourages retirement at an early age.
Planning for potential problems should start now. Do a basic inventory of the skills, training and personnel that your company will need in 10 years. Two-thirds of companies fail to do this, according to the Conference Board, a nonprofit research organization. If your analysis indicates that you'll need to keep retirement-age workers on the job, start changing policies soon to make aging workers more comfortable. Consider the following measures:
- Eyesight rapidly declines in older workers, so larger computer screens or new software that magnifies text may be in order.
- Workers between 45 and 64 are almost five times as likely to suffer from hearing loss as younger workers, yet few get the help they need because of the stigma and cost of hearing aids, which aren't covered by most insurance policies. Information and sensitivity programs, as well as user-friendly equipment—such as telephones with volume controls—can help.
- Arthritis can make certain tasks—including typing—difficult and painful. Although voice recognition software is still hard to use and problematic, it keeps getting better, so watch for the latest advancements.
- Older workers are more likely to want part-time jobs, flexible hours or even blocks of unpaid leave. For both financial and intellectual reasons, would-be retirees often want to cut back on work without giving it up entirely. Make it easy for them to do that.
- Older workers may want a more flexible compensation and benefits package. Baby boomers might be enticed to stay or return to the workplace even at a lower than normal salary if, for example, companies agreed to provide "gap" health coverage to supplement Medicare. Long-term-care insurance, elder care and estate planning assistance are other carrots that companies might offer to retain or bring back senior employees.
Employers won't necessarily have to do all the work themselves. As longevity increases, more older Americans want to stay active. And outside forces, namely the economy and the federal deficit, may make work essential.
For example, the gradual move from traditional pension plans to employee-funded 401(k) plans forced many older people to delay retirement when the stock market plunged in 2000. It will take years for most to make up the losses.
And Congress is likely to trim Social Security and Medicare benefits in the next decade. Already, the age at which workers can retire and collect full Social Security benefits is gradually increasing to 67. Congress has also repealed the penalties once imposed on older workers who chose to work while receiving benefits.
Researcher-Reporter: Nikki Eyman
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