As the baby boomer generation begins to retire in droves, employers face the challenge of retaining not only institutional knowledge and skilled workers, but also avoiding a talent gap. Known as the “Great Retirement,” the transition of these seasoned employees may be a natural and expected occurrence, but it doesn’t make the process any easier — especially in today’s volatile job market.
Understanding the great retirement
The Great Retirement reflects the mass transition of one of our largest generations, Baby Boomers. There are around 70 million baby boomers in the United States alone, and many of them are getting ready to retire. According to recent data, roughly 10,000 Baby Boomers retire daily in the U.S. — a number that’s expected to rise through the end of the decade.
This generational retirement wave has significant implications for the economy, as well as for individual retirees who will be making some big decisions about how they want to spend their Golden Years. Some experts predict that this shift will lead to labor shortages in certain fields, while others see it as an opportunity for younger generations to step up and take on new roles.
In any context, there’s an impending exodus of talent coming. That means employers need to start thinking about succession planning now — or risk finding themselves duking it out for talent in a marketplace that’s already overcrowded with competitors.
Implications of the great retirement for employers
It's a familiar refrain by now: the baby boomer generation is reaching retirement age, and as they exit the workforce, they’ll leave a significant talent void in their wake. Employers — particularly those in specialized industries — are grappling with how to fill that void and ensure their knowledge transfer strategies are effective. That said, there are other implications employers need to be aware of:
- Talent shortage: As baby boomers leave the workforce, one of the most immediate challenges for employers is a talent shortage. This shortage is particularly acute in industries with highly specialized skills and knowledge. Finding suitable replacements for these experienced workers can be an overwhelming task for talent acquisition professionals.
- Knowledge transfer: With the exit of seasoned employees, there’s a risk of losing critical institutional knowledge and expertise. To mitigate the loss of experienced staff and preserve institutional knowledge, organizations must devise strategies to ensure the effective transfer of knowledge from retiring employees to new hires, be it training documentation, or a strategy that involves both.
- Competition for talent: As the labor market shrinks due to the aging population, talent acquisition professionals face stiffer competition for skilled candidates. Attracting and retaining top talent becomes even more crucial due to the reduced availability of experienced personnel. It’s critical to put innovative recruitment and retention strategies in place to appeal to younger generations of talent.
How to find top talent in a shrinking labor force
How can talent teams mitigate a mass exodus of talent? There’s no single solution to the problem — instead, talent teams should adopt a variety of proactive strategies to address potential skill gaps, retain institutional knowledge, and attract experienced talent. Some practical approaches include:
Internal mobility
Effective internal mobility programs allow employees to grow and progress within your organization and can help reduce the impact of retirements. By encouraging your workforce to explore different roles within the organization, you can offer career advancement opportunities and encourage skill development.
Internal mobility also promotes loyalty to the company and enhances employee engagement. Workers are more likely to remain with an organization that invests in their professional development and career growth.
External recruitment strategies
Not all baby boomers who retire are truly moving out of the workforce. In fact, a Transamerica Center for Retirement Studies survey revealed that 54% of boomers plan to continue working in some capacity after retirement. That means employers should explore flexible employment options to leverage their knowledge and experience. Employers also can explore professional networks, industry associations, and job boards specifically tailored to mature workers to tap into this talent pool.
Skills-based assessments
Your existing employees are an untapped treasure trove of talent and experience that could benefit your organization for years to come. The first step in retaining them includes a comprehensive skills assessment. Conducting a skills assessment of your existing workforce can help you identify employee strengths, weaknesses, and potential skills gaps.
With a skills assessment in hand, employers can proactively address any deficiencies through targeted training and career development programs. Not only will your employees become more skilled and capable, but your organization will benefit from increased productivity and a more engaged workforce.
Succession planning
Employers can think ahead and combat the Great Retirement by developing a robust succession planning strategy. This involves identifying high-potential employees and grooming them for leadership roles. By nurturing internal talent, organizations can ensure a smooth transition when experienced employees retire. Succession planning also ensures that the company will continue to grow and thrive in the face of key employee retirements.
Take a proactive approach to the great retirement
As the Great Retirement gains momentum, employers must think strategically about the future of their workforce and adopt the strategies and technology that will help them streamline and optimize processes, better engage and qualify talent, and support internal mobility and career development.
Need help crafting a strategy that works not just for your business, but for the type of talent you’re hoping to attract? From skills assessments to employer branding, Symphony Talent is ready to support you. Contact our experts today to get started.
