A major demographic shift in the workforce is now happening, and most companies are unprepared to address it. The challenge? The impending mass retirements of baby boomers, which will leave organizations struggling to find talent with the skills and expertise to replace them. For some industries, this obstacle has already emerged. Today, 50 percent of the nursing workforce is near retirement age, further exacerbating the already short supply of nurses.
But it’s not just healthcare – all industries and business sectors will soon face this problem, with every 10th worker in the US eligible to retire this year or next. According to the Wall Street Journal, the working age population of the world’s advanced economies will decline for the first time since 1950, resulting in a decrease of 5 percent by 2050, impacting how organizations around the world find the talent they need to drive business success.
Research from the United Nations predicts Europe will be hit the hardest, with a consistently decreasing population of 738 million in 2015 to 646 million by 2100. Asia and Latin America will continue to grow until 2050 before their populations begin to decline. Meanwhile, despite a high number of retirees in the near future, the population of North America is expected to grow from 396 million to 500 million by 2100. And Africa is currently on an explosive growth path, with its 2015 population of 1.2 billion expected to reach 4.4 billion by 2100.
As this demographic time bomb continues to tick away, how will itaffect today’s employers? Businesses will have to find a huge number of workers to replace those retired employees and still meet consumer growth. As the global population continues to age, the young and growing population of Africa presents new opportunities for companies to source talent and replace those retiring workers around the world.
To best prepare for the demographic time bomb, organizations must act now to develop a plan to replace the skills, knowledge and expertise of their most experienced employees. Consider the following steps to help your organization ensure it has the talent in place to succeed in the coming years:
- Assess the workforce and prepare for knowledge transfer: Understanding what percentage of your workforce is due for retirement and how the loss of their skills and knowledge impact operations is the first step. Just as important is capturing their knowledge and transferring it to the next generation.
- Embrace technology: As good talent becomes increasingly hard to find, the right technology solution can facilitate each stage of the talent acquisition process. Key capabilities should be recruitment marking to find, attract and cultivate new talent from around the world, candidate management to keep them engaged, features to facilitate interview, screening and evaluation processes and analytics to continually improve.
- Diversify your talent strategy: As traditional sources of talent dry up, organizations will need to access new markets to find the talent they need, and look beyond the traditional employee model to fill key gaps. Working with talent providers will take the pressure off internal teams, while helping them adopt a total talent approach to leverage contingent talent and gig workers more effectively.
- Offer flexibility to aging workers: Some employees of retirement age may want to continue working, but not five days a week. Offering flexible work arrangements, such as allowing them to work a couple of days each week, will help to retain their experience and skills while giving retirees the option to remain active.
As workforce demographics continue to evolve, employers must be ready to address these changes. Not only must they find a way to transfer the knowledge of their most experienced workers before they retire, but they also need to access qualified talent in a shrinking workforce to replace them. As the challenges of talent acquisition will only continue to grow, the companies that work proactively to secure and retain talent will be best suited to emerge from the demographic time bomb effectively.
[…] A major demographic shift in the workforce is now happening, and most companies are unprepared to address it. The challenge? The impending mass retirements of baby boomers, which will leave organizations struggling to find talent with the skills and expertise to replace them. For some industries, this obstacle has already emerged. Today, 50 percent of the nursing workforce is near retirement age, further exacerbating the already short supply of nurses. But it’s not just healthcare – all industries and business sectors will soon face this problem, with every 10th worker in the US eligible to retire this year or next. According to the Wall Street Journal, the working age population of the world’s advanced economies will decline for the first time since 1950, resulting in a decrease of 5 percent by 2050, impacting how organizations around the world find the talent they need to drive business success. […]