Employers in denial over aging workforce

Many U.S. businesses are already being hit by the effects of the aging workforce. But despite this, a significant proportion have still failed to put any plans in place to deal with a problem that just isn't going to go away.

Despite all the predictions that the U.S. faces a shortage of millions of workers as baby boomers retire - taking with them years of experience, talent and expertise and leaving fewer new workers available to take their place – a new study by the Boston College Center on Aging and Work has found that many U.S. businesses remain unprepared for changing workforce demographics.

In fact The National Study of Business Strategy and Workforce Development suggests that more than a quarter have no plans to deal with the effects of an aging workforce.

"Even though organizations know that the workforce is aging and understand that their own workers are looking at retirement, many are not making plans for how business will adjust to these changes," said Marcie Pitt-Catsouphes, co-director of the Boston College Center on Aging and Work.

Mick Smyer, co-director of the Center. Warned that companies that do not plan for this aging workforce may find themselves suddenly faced with a loss of labour.

"This experience and expertise will be difficult to offset, given the relatively small pool of new workers and the competition for new talent likely to result from so many companies facing the same problem," he said.

The study quizzed 578 organizations across the United States and found that fewer than four out of 10 (37%) of employers had adopted strategies to encourage late career workers to stay past the traditional retirement age.

This is despite the fact that employers acknowledged that such workers have high levels of skills and strong professional and client networks, a strong work ethic, low turnover and are loyal and reliable.

Yet at the same time, the symptoms of demographic change are obvious. Some six out of 10 of the employers said that recruiting competent job applicants is a significant HR challenge, while four out of 10 said that management skills are in short supply in their organizations.

Astonishingly, meanwhile, only a third of organization have made projections about retirement rates of their workers to either a moderate or great extent.

The Boston College researchers added that employers also need to start asking some critical questions about their workforce, such as how managers can promote the sharing of knowledge among employees at different career stages and whether employing more older workers could help the organization to address some of its HR challenges.

But as Marcie Pitt-Catsouphes added, one key to ensuring older people's continuing participation in the workforce that is often overlooked is the importance of flexible work options.

"Most older workers who say that they want to extend the number of years they remain in the labor force also say that the typical 8-hour day/5-day week doesn't work for them," she said.

"Employers who fail to consider flexible work options may be missing important opportunities to enhance both their business performance and their employees' engagement."