Published March 2002

Take steps now to retain
an aging work force

Q. It should have been obvious, but we are realizing that our work force is getting older fast. Our business has stabilized over the last decade, and we haven’t needed to hire, nor have we had many people leaving the company. If the trend continues, we may face the prospect of a wave of retirements with not enough “young blood” to step in to take their place. What steps can we take to prevent such an occurrence?

A. I’m sure you are not alone in noticing that people at work are aging faster than you realized. The evidence is before you: grayer hair, larger waistlines, thicker glasses and deeper wrinkles becoming more common.

Like the general population, the American work force is aging and aging fast. In the next five years, the leading edge of the baby-boom generation will approach the traditional retirement age.

Over the next 15 years, the exodus may turn into a flood of healthy, relatively wealthy 60-somethings saying goodbye to work and hello to Social Security checks, 401(k) cash-outs and overcrowded golf courses and trout ponds.

And because the next generation dwarfs in comparison to the boomers, there will be fewer and fewer younger workers with the skills, experience and talent to take their place.

Consider the numbers:

• Every eight seconds for the next 10 years, a boomer turns 50. That’s 11,000 turning the big 5-0 every day.
• By 2006, workers 45 years and older will constitute nearly 40 percent of people working. Just three years ago, people below age 44 made up 70 percent of the American work force.

While over 2 million layoffs in this economic downturn may have slowed the trend, once the economy rights itself and hiring resumes, competition for workers will again be keen. Don’t be surprised to hear again of signing bonuses, car giveaways and retirement benefits where they never before existed.

Jerry McAdams, a work-force management consultant for Watson Wyatt Worldwide, has been studying this issue for several years. He recommends businesses begin revamping how they motivate and reward older workers.

Employers can start by recognizing that older workers want the same things from their employers as younger workers, according to the latest surveys.

“Employees today want to be treated as organizational partners, not pawns,” McAdams said. They want more choices in organizing their work lives as they grow older, he said. Specific steps employers can take to retain older workers beyond traditional retirement include:

• Offer a “cafeteria” of working arrangement options. “Phased retirement” allows employees to continue working past traditional “retirement” by offering shorter workweeks or workdays, being assigned work on a “project” basis, or taking half-year or quarterlong sabbaticals. Companies can bring back retired employees as independent consultants while allowing them to keep receiving any retirement payments.
• Reward the “intellectual capital” of older workers. Replace industrial-age seniority pay systems with informational-age performance pay arrangements. That way, older workers can be paid for increasing their skill levels and mentoring younger workers, and they can receive “gotcha” bonuses or spot awards for specific performance excellence.
• Offer senior pressure relief. As technically savvy younger workers learn leadership skills from the older workers, phase them into more demanding supervisory jobs, freeing “seniors” to provide specific skills and “intellectual capital” the organization needs.

“Make the older worker the ‘project brain’ rather than the project manager,” McAdams said.

Eric Zoeckler operates The Scribe, a business writing service. He also writes a column appearing Mondays in The Herald. He can be reached at 206-284-9566 or by e-mail to mrscribe@aol.com.

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