The U.S. workforce is facing a loss of brainpower like never before. When the approximately 76 million people born between 1946 and 1964 retire, the Census Bureau says they’ll create the largest single-generation workforce exodus ever. These losses will lead to a significant gap in talent—and an enterprise scramble to compensate.
To take a closer look at what the future may hold, UNC’s MBA online program created the Baby Boomer Brain Drain infographic. It includes the facts surrounding the baby boomer brain drain—including the effect baby boomers have on today’s workforce, how their retirement will affect the future of business, and what companies can do to prepare. Here’s a brief overview of the infographic:
Effect on today’s workforce
The “brain drain” dynamic can occur in any setting in which well-educated and highly skilled workers move from one environment to another—whether it be a new country or a new way of life, such as retirement.
For U.S. businesses, the upcoming exodus of so many in leadership positions promises a challenging talent gap if companies don’t prepare. Consider the following:
· 31 percent of the workforce are baby boomers.
· 56 percent of baby boomers hold leadership positions.
· In 2029, all baby boomers will be at least 65 years old.
· By 2030, the number of people over the age of 65 is expected to double to 71.5 million.
Effect on the future
The future impact on U.S. businesses will largely depend upon how well companies prepare now. Despite the fact that 62 percent of employers at Fortune 1000 companies agree that the impending exodus will create skilled labor shortages over the next half decade, few are taking action. Perhaps the following will create motivation:
· 66 percent of companies with employees are owned by baby boomers.
· Businesses worth an estimated ten trillion dollars are expected to change ownership over the next 20 years.
· Companies in regions densely populated with baby boomers face a higher impact.
· Companies in specific knowledge-intensive industries are at increased risk.
What companies can do to prepare
Fortunately, senior leaders are typically eager to share their expertise with younger generations—something that companies should capitalize on now. By taking a few specific steps, companies will be better positioned to make that happen:
· Analyze your workforce. Understanding the mix of your multi-generational workforce will make your plan more effective.
· Refine your retention strategy. This is true across the board—helping you hold on to baby boomers longer and more effectively retain those in whom they invest.
· Make potential retirees a priority. Everyone wants to be appreciated, and additional attention now will pay off in the long run.
· Prepare prospective leaders. Identify emerging talent and provide training and responsibilities.
· Optimize knowledge transfer. Create an environment ripe with opportunities for baby boomers to pass on their expertise. A mentorship program is a great way to do this.
By understanding more about the upcoming Baby Boomer Brain Drain and the impact it may have, you can help your company better prepare and avoid the talent gap that looms on the enterprise horizon.
Alison Napolitano is the community content manager for MBA@UNC, UNC Kenan-Flagler Business School’s online MBA program. Connect with Alison on twitter at @anapio7.