Boomer retirements looming
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The workers who run the Lower Colorado River Authority’s hydroelectric dams refined their skills with decades of on-the-job training. And when they leave, they’ll take all that experience with them.
That day isn’t far off. The looming loss of older workers’ skills brought Andi Handy, the authority’s executive manager of human relations, and about 30 other business and government officials to IBM Corp.’s offices Tuesday in Austin.
Given the fact that the leading edge of the baby boom generation turns 60 next year, there’s a massive collection of workers and experience that could soon leave the workplace. By 2025, almost a quarter of the U.S. population will have passed their 60th birthday.
Texas currently has 3.1 million residents over 60, the fourth-largest over-60 population in the country. That’s expected to more nearly triple during the next 35 years, according to a study by the Texas Department of Aging and Disability Services.
In the Austin-San Marcos region, the over-60 population is expected to increase more than fourfold, the study found. That’s the largest increase among Texas cities.
With far more skilled workers leaving the work force than entering it, it’s a problem no business can avoid. That’s why IBM’s consulting business is trying to create a niche in helping other companies deal with the loss of knowledge as boomers retire.
“As shortages occur, the reality’s going to force a lot of organizations to make some changes,” said Ed Vitalos, associate partner with IBM Business Consulting’s human capital management services and one of Tuesday’s moderators.
At the LCRA, the concern is more immediate than at most organizations. Of the 2,225 employees who work for the authority, 21 percent will hit retirement age within the next five years.
“We’re particularly worried about the power-plant operators,” she said. “They’re at the heart of the plant.
More companies and government agencies are starting to face the reality that their experience needs to be retained, whether the employee stays or goes. For many larger and older companies, the problem of retiring workers isn’t new, although baby boomer retirements will take it to a new level. Many small, young companies haven’t faced the issue yet, but many of them will.
“It’s important that all employers think about how to retain their key people,” said Ron Lehman, commissioner representing employers at the Texas Workforce Commission.
Many companies are adopting flexible schedules for older workers who don’t want to retire completely. Seton Healthcare Systems uses a voluntary on-call program with some of its retired nurses, for example.
The programs reflect a broader trend, said state Rep. Dan Gattis, R-Georgetown. Most baby boomers don’t see retirement the same way their parents did.. A Merrill Lynch & Co. study found that 42 percent of boomers would prefer to “cycle between work and leisure.” Only 17 percent said they would never work again.
While companies would prefer to have clearly defined retire- ment programs, the rise of custom schedules will require firms to “educate managers and give them the authority to make decisions” about individual workers’ needs, said Jeanne-Marie Bowman, human resources strategist at Freescale Semiconductor Inc.
Such flexibility is common for high-skilled positions, but it tends to be more difficult for many blue-collar and lower-wage jobs, said Christopher King, director of the Ray Marshall Center for the Study of Human Resources at the LBJ School of Public Affairs. Companies might offer flexible schedules to some employees and not others, he said, and the divisions often could fall along class or ethnic lines.
But ultimately, like virtually all business decisions, this one will come down to a balance of costs and benefits. And for many companies, there’s too much work experience at stake.
“Companies will lose people,” IBM’s Vitalos said. “They’ll try to replace them, and the (challenges) will start.”
The coming retirement boom
2025: Year that about one-quarter of U.S. residents will be 60 or older
21: Percentage of LCRA workers who will reach retirement age by 2010
3.1: Million Texans over 60, 4th-highest in the United States
16.2: Percentage of Central Texans over age 65 in 2000 census
Sources: IBM Corp., Lower Colorado River Authority,
Texas Department on Aging, U.S. Census Bureau