As the Baby Boomer generation of approximately 76 million people worldwide begins to retire, there will not be enough people in the next generation of 46 million Gen Xers to replace them.
The result? An impending talent crisis. That said, the GFC and the continuing global economic instability are buffering and delaying this crisis (because some Baby Boomers can no longer afford to retire).
While the theoretical principles of staff retention are easily understood, it is the practical application that is complex and multi-faceted. Applying these principles in a changing environment, adds a layer of further complexity that many organisations are unprepared for. Various trends are converging to dramatically change how staff define career success and what they want or need from their work life. As leaders we need to understand the implications for businesses. I want to explore the implication of this trend in depth over the next few weeks but let’s start with today’s big news: downsizing.
Companies are downsizing significantly and leaders would welcome voluntary retirements. The concern of a mass exodus of the most senior leaders in today’s organisations has been tempered by the significant drop in financial wealth caused by the fall in the stock market, coupled with the fact that many Boomers still feel in their prime at 65 and want to continue to work beyond the normal retirement age.
However, even with some of the Boomers staying in the workplace longer, there will still not be enough new entrants to meet staffing needs. Our knowledge economy demands high-level skills and expertise from employees. The fact that universities are also hard hit by the economic crisis does not bode well for our ability to develop the skills the economy needs to grow and be competitive.
So, how do leaders keep Baby Boomers engaged? Some Baby Boomers will continue to work out of necessity, but they may want to work in a different way. Some may want to work part-time, while others will reinvent themselves by doing something new, such as starting a business, consulting or changing careers.
Aging Boomers are also starting to ask for the same kind of flexible work arrangements as Gen X and Y employees. They want flexibility in terms of when they work, where they work, how much they work and what they do. The move is away from having to work, to working because they want to, which is the model of an engaged workforce
With a shrinking workforce and significant skill gaps forecasted, this is just the tip of the iceberg when we begin to look at the impact this will have on careers over the next decade. But one thing we do know for sure is that we need to understand the needs of retirement-eligible Boomers to keep them engaged in the workplace
In my next post, we will look at the implications of an increasing global, diverse and virtual workforce on the retention of staff.