The ability to extract critical information from about-to-retire Boomers is absolutely essential. And now, the big boys are weighing in with consulting services to assist companies in the process. IBM is the latest to join the party.
From the Atlanta Business Chronicle of January 13, 2006, written by Randy Southerland.
The employees behind the desk and on the shop floor are a lot grayer than they used to be. And, this aging work force is starting to worry a growing number of companies as baby boomers near retirement and get ready to take years of experience and knowledge with them.
“They’re facing a risk that demographically they have perhaps the largest group of individuals who are going to be approaching retirement age that they’ve ever faced before,” said Eric Lesser, associate partner with IBM Business Consulting Services.
The numbers are sobering, according to a recent report by the Conference Board Inc., a research service for executives. By 2010, the number of 35- to 44-year-olds who normally enter the ranks of senior management will stop growing. U.S. workers aged 45-54 will grow by 21 percent, while those 55-64 will increase by 52 percent.
The result is that 64 million baby boomers (more than 40 percent of the U.S. labor force) are poised to retire in large numbers.
To prepare for the boomer retirement wave, IBM has introduced new consulting services. These include an analysis of key positions, including age of employees and skills needed. Then, to ease older workers into retirement while still retaining their knowledge, they can help companies develop alternative work arrangements such as part-time and consulting positions.
Other programs include mentoring, in which a younger employee shadows an older worker to learn the ropes. Specialized expertise can be captured on video, or skills can be passed along through informal communities in the organization, Lesser said.
“More and more companies are finding that it’s not just the knowledge they have, but also the connections and relationships,” he said. “Older workers who have been in the company for 20 or 25 years know how to get things done.”
Borders, Wal-Mart and other retail-sector companies often are eager to hire the older worker because he’s “going to show up and he’s going to be good at customer service,” said Gail Geary, a career-management consultant with the Atlanta office of Right Management Consultants and author of “Over-40 Job Search Guide.”
While some industries are becoming acutely aware of the brain drain, most companies aren’t facing up to the impending shortage.
“The number of companies that are proactively trying to retain the knowledge is probably somewhat limited at this point,” said Lori Hulsinger, senior associate with Mercer Human Resource Consulting LLC.
One reason that some companies aren’t implementing programs to retain older workers is fear of legal trouble.
“Employers need to be careful that they’re not putting someone on an alternative schedule if that’s not what the person wants,” said Chad Shultz, a partner with Atlanta-based labor and employment law firm Ford & Harrison LLP. “The law still requires that you treat them the same as other employees.”
In addition, workers covered by defined-benefit retirement plans face different hurdles under federal tax and pension regulations. Many such pensions are based on the average salary during the final three years of employment. Shifting a worker to a part-time role in the final year could mean a reduction in the calculation for pension payments. In most cases, the law requires a minimum period of separation — usually six months — before an employee can return to the company in a different role, said David DeLong, author of “Lost Knowledge: Confronting the Threat of an Aging Workforce”.
“Some companies have firm rules that forbid rehiring retirees for any purpose, just to protect themselves to the max,” he said.