Study: Employers slow to address aging workforce

SHRM report highlights challenges for human resources departments to take a lead on.

By Jonathan Pont

lthough the U.S. Bureau of Labor Statistics predicts that the number of workers over the age of 55 will increase by nearly one-half over the next seven years, that trend apparently has yet to light a fire underneath HR departments.

But there are issues to be addressed, from organizations' dim awareness of the issue of the aging workforce to deficiencies among younger workers who are joining the workforce to replace them.

Those are two conclusions of a report SHRM issued Sunday titled 2005 Future of the U.S. Labor Pool. The report paints a less-than-encouraging picture of what companies are doing to prepare for the wave of retirees whose departure could leave some businesses at a competitive disadvantage.

Thirty-eight percent of respondents said that they were just becoming aware of the problem that looms with the retirement of the baby boom generation. Of the remaining 62 percent, just over a third said that their companies were only now beginning to examine policies and practices to deal with the changes.

Only 11 percent of companies actually have implemented them.

Among companies making changes, however, the report says that size matters. Typically, a business with more than 500 employees has some built-in advantages. Financial resources and more staff have allowed these companies to be proactive.

The report also found that awareness of the problem correlated to size. Once again, the larger the company, the greater the awareness of the aging issue.

But the report made clear another split: whether the aging issue really is going to have a detrimental impact on business, particularly on recruiting.

News reports have been filled with the efforts companies are making to recruit older workers, for reasons that range from the expertise they may have to their willingness to work flexible schedules.

AARP has gotten in on the act, with a program that matches corporation with retirees who still want to work.

The SHRM report does raise questions about whether companies are in trouble. Sixty-nine percent of respondents said that the retirement wave would have no impact or a very small one on their recruiting, retention or management.

SHRM president and CEO Sue Meisinger said in a statement Sunday that while the impact of the baby boomers leaving the workforce can't be fully determined, it was the role of HR to "determine how to meet those challenges.”

One place HR might want to look is the incoming crop of workers. While executives like Bill Gates recently have bemoaned the lack of science and math skills among graduates, the SHRM study points to a number of shortcomings that could easily overshadow any recruiting difficulties that departing baby boomers pose.

HR professionals reported that overall professionalism, written and verbal communication skills, analytical skills and business knowledge are lagging for workers entering the workforce. Overall professionalism, for example, was something that 59 percent of respondents cited as the area in which candidates most lacked competency.

The survey also asked respondents about ways their companies were addressing the issue of workforce readiness.

Among the most effective are school-to-work programs, where businesses form partnerships with schools to provide opportunities to students, and so have access to a ready-made supply of fresh talent. An overwhelming majority of respondents said that such partnerships have helped close skills gaps in their industry, and filled open positions too.

Seventy-one percent of companies said they have training programs that address the needs of current employees, strengthen skills and improve promotion from within.

Even if waves of retirement have a modest impact on recruiting, companies will want to consider implementing training plans for current employees. By a ratio of 3-to-1, respondents in the study say they help address the skills gap and aid internal promotion.

Know youngsters so you can mold them

Author Eric Chester says HR execs need to recognize the "shift away from the traditional work ethic.”

By Janet Wiscombe

ric Chester knows what you're thinking: Young workers just don't give a damn. He knows you watch in horror as a steady flow of new employees at your company streams out the door. And he knows you are spending more time than ever recruiting people who are in the 16- to 24-year-old age group—with worse results.

Members of this generation have shoddy work habits; they are often rude, uncommitted and self-centered, Chester says. But if human resources executives take the time to understand what makes them tick, they are far better able to transform them into committed, productive, even loyal employees, he says.

Chester is the author of several books, including Employing Generation Why and the recently released Getting Them to Give a Damn: How to Get Your Front Line to Care About Your Bottom Line, which is also the topic of his session at 4 p.m. today. He is well aware that there are plenty of conscientious young adults. Still, he doesn't mince words when talking about stark new trends.

"They are nothing like you and me,” he says flatly. "Now there are many more service jobs. If one doesn't work out, you can get another one by the weekend. Our parents were more doit- yourselfers. They valued jobs.

"This generation is totally different. They were born to buy. They have completely been wired from birth to buy. Marketers—not their mothers—have told them what athletic wear to buy, what cereal. They are very affluent. They have cell phones and iPods.”

What they don't have is a strong work ethic, he says. Social attitudes have changed from "Work hard and get ahead” to "In order to win in life, you've got to get more than you put in.” Get yourself a piece-of-cake job that doesn't require much effort for a paycheck.

To successfully find and keep members of this age group, companies must understand their expectations. "In my presentations, I say, ‘Let's take a look at who we're talking about and why they approach the workplace so differently from any other generation,'” Chester says. "People in HR only spend a little time studying this generation. That is a big mistake. If they spent even the very smallest fraction of time studying this generation the way marketers do, they would be much better off.

"You have to know your labor base,” he adds. "The only way companies can drastically reduce their turnover is by paying attention to who their workers are.”

Chester, a nationally recognized expert on Generations X and Y and president and founder of Generation Why Inc. in Lakewood, Colorado, is a consultant for such companies as Cold Stone Creamery, Wells Fargo, BellSouth and Harley-Davidson. He helps employers understand the values, expectations and skills that teenagers and young adults bring to the workplace.

It isn't that this generation is bad or wrong, he emphasizes; but it is different—very different.

Until the economic boom of the early '90s, companies were in the driver's seat. "If you wanted to land a job, you knew you had better clean up, buck up, suck up and shut up,” he says.

In his latest book, Chester writes about how today's new service economy has profoundly changed the way people approach work: "There's been a shift in the importance of self-expression, in the way the game is played, a shift away from a traditional work ethic.”