Capitalizing on the new mature workforce.(retaining mature employees)(Author abstract)

In order to help employers and human resources professionals understand key trends and prepare for the aging of the workforce in the next decade, Age Wave, an expert on population aging, and BSG Concours, a national HR consultancy, launched a three-year, multimillion dollar national study of the dynamics of today's workforce. This study, the New Employee/Employer Equation, was developed in partnership with more than 20 major U.S. organizations and included a cross-industry national survey of more than 7,700 managers, professionals and workers conducted by survey firm Harris Interactive. Key findings reveal trends and specific steps organizations can take to begin reorienting their strategy and policies to capitalize on the new mature workforce.

In the 1970s, the 78 million-strong baby boom generation began to enter the workforce in significant numbers, replacing the much smaller cohort--born during the Great Depression and Second World War--that preceded the boomers. The impact was both immense and pervasive; the pool of available workers increased by 29 percent in a single decade. (1) Workforce growth remained strong in the remaining decades of the 20th century as the influx of younger boomers continued to buttress the numbers of workers.

Today, however, with the youngest boomers in their early 40s and the oldest boomers in their early 60s, workforce growth is coming to a virtual standstill. From an increase of 29 percent in the 1970s, America's workforce will grow only 12 percent in the current decade and will increase a mere four percent in the next decade. The collapse in workforce growth is the simple result of demographic realities. In the current decade, the population of adults age 18-34 will increase by just seven percent. In the next decade (2010-2020), the age 18-34 population will grow a mere three percent. (2) The era of an unending supply of young workers is clearly over.

Where will we find our workers? The middle cohort--those age 35-54--will also experience virtually no growth in the next couple decades. The only population that will demonstrate substantial growth between 2000 and 2020 is those age 55+. Fueled by the aging of the baby boom generation, the number of adults age 55 and older will increase by 28 percent in the current decade, and another 27 percent between 2010 and 2020. (3)

Predictions of a talent shortage are dire. Based on GDP growth requirements, the Employment Policy Foundation projected a shortage of several million workers this decade, 10 million by 2015, and 35 million by 2030. (4) But it is not the mere shortage of workers that will cause the greatest difficulty. As members of the boomer generation enters into their retirement years in greater and greater numbers, organizations will confront a massive brain drain of skills and know-how among their most experienced workers and management. Nearly seven million talented people in key managerial, professional and technical jobs may exit the workforce in the next 10 years. (5)

The impact of the talent crunch is already being felt. According to a national survey conducted by Robert Half International and CareerBuilder.com, more than 81 percent of hiring managers reported having difficulty finding qualified candidates in 2006, which was up from 55 percent in 2005. (6) More than 80 percent anticipate it would be as hard as or harder to find qualified candidates in 2007. In 2006 the PricewaterhouseCoopers' Trendsetter Barometer found that half of surveyed CEOs said they are concerned that a shortage of qualified workers could limit the growth of their organization in the coming year. (7)

Yet, despite the increasing shortage of young workers and the unprecedented growth of available mature workers, organizations continue to focus their recruiting and development efforts on the younger workers. According to a 2007 survey by Manpower Inc., only 18 percent of employers in the…