The Impact of Retiring Baby Boomers
The pool of skilled, available talent is shrinking. On top of the unemployment rate being at an 19-year low, the huge age class known as the baby boomers are reaching or approaching retirement. In fact, in 1995, baby boomers comprised about half the workforce, but by 2025, that generation will represent less than 10 percent of it.
What does this mean for the job market?
Less Skilled Talent Available
Almost three quarters of employers are already struggling to find relevant candidates for open positions. This will only get more difficult as more baby boomers exit the job market. The result of this smaller talent pool means that employers will be vying for the same candidates. In other words, recruitment will become even more of a challenge than it already is.
Younger Generations Are Not Entering the Same Industries
Another issue to consider is that as baby boomers retire, younger generations are not choosing to find work in those same industries, so they are being replaced at a very slow speed. This creates a hard-to-recruit position where there may have not been one before.
This is especially true in manufacturing and skilled trades, such as electricians, masons, carpenters, plumbers, etc. Within the next ten years, 2.7 million manufacturing employees are expected to leave the workforce. And there is an expected increase of almost 86,000 electrician positions by 2024. Filling those positions will become especially difficult when younger generations are choosing other career paths.
Baby Boomer Succession Planning
With baby boomers retiring in droves, with more reaching the age of retirement each day, it’s important for companies to begin thinking about a succession plan now.
Succession planning consists of identifying and developing future leaders at your company. This creates a contingency plan for inevitable change, whether that be baby boomers retiring, other employees leaving, or someone getting too sick to work.
In addition to keeping your company prepared in the event of change, having a succession plan also will help you develop a hiring plan so that you can identify what positions will be necessary to recruit for rather than hire for internally.
Once you have a succession plan in place, you can better move onto your hiring plan. The need for a powerful recruitment plan in this job market is clear. What you may not know is that benefits is the number one driving factor in the decision to join a company, with health insurance being #1.
There is a type of supplemental health insurance that is employer-paid that can be offered to select employee classes, even just those hard to recruit positions. It’s called expense reimbursed insurance, and it can offer real insurance protection from $5,000 to $100,000 in annual coverage. This is an innovative benefit that employees will value and won’t find at competitor companies, whereas compensation and a bonus can always be matched.
Finding the right talent to replace retiring baby boomers won’t be easy, but with expense reimbursed insurance, you can have the right tool on your side to hook the candidate you want when you find them.