November 5, 2018
By: Heather Galloway, CID Account Executive
There is a mass exodus of experience and knowledge ready to walk out the door of your company. This only adds to the greatest fears of business owners across industries who are already losing sleep over finding and retaining great talent. Traditionally, this fear has been about finding qualified candidates, but there is a rising trend in increasing employee turnover due to retirement. Statistics show 10,000 baby boomers will retire each day, and regardless of the industry, you find yourself in currently, you are starting to feel the shift and change. There is an impending gap in the workforce. While these future openings will create room for Millennial or Gen Z employees to grow and progress through a career, business owners across the board will face a larger problem than just trying to fill those open positions. If we as businesses do not do something to address this issue, we run the risk of an imminent knowledge gap and lack of expertise among more inexperienced teams.
The aforementioned statistics indicate a large number of baby boomers headed toward retirement, but the story they do not tell are the numerous individuals who will not be able to afford it. Whether in part because of the financial crisis, issues with social security, or rising cost of living, many baby boomers are looking at retirement in their 70s once they have had a chance to build up their savings. 3 out of 5 baby boomers plan on continuing employment past the age of 65 according to the Transamerica Center for Retirement Studies. However, not all of these extended careers will be due to financial motivations. This generation is also a group of hardworking employees and the last thing they want to do is retire and become sedentary. Many of these individuals will look for a hobby or volunteer opportunity to stay active and healthy into their older years.
There is an opportunistic overlap between company needs and the desires and needs of this baby boomer generation. Take the insurance industry, for example, it is difficult to find a young, quality candidate with expertise in insurance. Instead, hire a candidate with a great work ethic who is well suited for sales and building relationships and then teach them insurance. While this is a great practice, there are few agencies with the resources to provide that type of in-depth training while attending the day-to-day business needs. What if, instead of letting the wealth of knowledge and expertise retire and walk out the door, we begin to offer these employees an option: part-time training and consulting for the company on a contract basis. This option provides flexibility for the individual and an opportunity for them to stay active and involved, giving back to the industry and investing in future talent. For companies, this solution would provide resources solely dedicated to training and information sharing while direct employees continue to provide excellent service.
The insurance industry is not the only industry that could adopt such a model. For blue-collar, labor-intensive industries, there is a more apparent advantage to utilizing this consultant/mentor position. According to the National Safety Council, currently only 1 in 5 new workers receive safety training, and employees in their first month on the job have more than 3 times the risk for a lost-time injury than longer-term workers. Creating mentor positions for baby boomers reduces the physical strain on older employees and keeps them engaged, but you also utilize their expertise to mentor and train new talent, helping to mitigate losses with inexperienced employees. Baby boomers leaving the workforce is truly a business risk, but companies can leverage this risk to reduce Workers Compensation claims and create an efficient, internal training program to better their companies and industries alike.
At Thomas McGee Group, we are experts in risk management. We view all business risk in the same light, and we provide much more than traditional insurance. We have seen incredible successes for our clients in the alternative risk space, and in our eyes, this soft cost of losing talent is no different from every other risk your business faces. We will all face this baby boomer exodus, and that time is quickly approaching. The question is how companies and industries will adapt. Let us commit to being flexible and innovative. Use this opportunity to redesign retirement in your industry to achieve future growth and success.