The "silver tsunami" is coming. The baby boomer generation is beginning to hit retirement age, and companies must prepare for what could be a major exodus.
The US Bureau of Labor Statistics reports that as many as one out of ten workers will retire either this year or the next. Losing 10 percent of its employees can hit a company incredibly hard if it's not prepared. Just how does a business brace for the loss of so many workers?
Will There Be a Tsunami - Or Just Waves?
The first thing to realize about the upcoming retirement boom is that it may not be so much of a boom. Economists have predicted the baby boomers' retirement for years now, but it hasn't happened. Many baby boomers stay on past the age where they can retire - either due to financial difficulty, issues with their pension funds, or the desire to remain professionally active.
Given this development, it seems as though the dreaded "silver tsunami" may not come as a single destructive incident but as a series of smaller waves as some baby boomers retire and others stay on. Each business needs to evaluate its workforce and staffing levels to determine how likely, and significantly operations will be affected.
Even when baby boomers opt not to retire immediately, it doesn't mean an easy transition for companies. Enterprises will face challenges, such as keeping their older workers up to date with new technology and paying increasing healthcare costs.
Provide Flexible Options to Keep Baby Boomers Working
One way companies are holding onto their talented baby boomers is by giving them flexible working conditions. An employee who can no longer work full time due to health concerns, or one who just wants to spend time traveling, may be persuaded to continue to work on a part-time basis. Allowing baby boomers to set their own schedules, for example, may offer both the financial security they need and the ability to do the things they'd always dreamed of doing once they retired. This is a win-win - companies aren't reeling from a sudden loss, and the employee can stay involved.
Pass the Torch
Companies are making increased use of older workers who haven't retired by creating programs for them to mentor new employees, which allows businesses to reap the benefits of the baby boomer's years of experience in training the next generation of workers. Mentoring programs are especially important in fields like science and engineering, where there's a greater need for Millennials to fill those roles when baby boomers leave.
An intergenerational mentoring program can do more than just help new workers absorb knowledge from more experienced employees. Each of the three generations currently in the workforce has something they can teach to the others:
- Baby boomers gained experience in navigating interpersonal relations: They can pass on communication, leadership, and office-politics advice.
- Gen X can teach baby boomers and Millennials to improve their focus: The unsentimental mindset of Gen Xers makes them good at playing Devil's Advocate - a useful skill they can teach the others.
- Millennials have the most knowledge in today's technology: Millennials were born into and grew up in the digital age, giving them a better handle on technology and a more innovative and global mindset.
Improve Your Talent Acquisition Strategy
But no matter how what perks and training and flexibility you offer, there will come a time when older workers believe they are just ready to retire. Knowing this is inevitable, businesses need to have a talent acquisition strategy in place to find new employees.
Here are some techniques you can use to prepare your talent acquisition strategies:
- Hire workers for the contingency: Knowing that the retirement boom is coming allows companies to prepare for a shortage of employees by finding and hiring excess employees now to make up for the ones they expect to lose.
- Employ strategic analytics: Using big data and people analytics can allow companies to make more accurate predictions of how many workers they may lose and when. They can also predict what specific departments will need the most replacements and can begin looking for new hires in those areas.
- Expand the potential talent pool: The best employees are often found through employee referrals - start gathering these early to build a pool of potential hires at the ready. Companies' talent pools can also be expanded by looking in different geographic locations and considering telecommuting positions.
It's only a matter of time before all baby boomers retire. There's nothing that companies can do to stop it from happening, but the information and advice above can help them prepare. Make the most of your baby boomers while they're still working, keep them working happily longer, and be ready to acquire new talent when they finally leave.