Friday, June 29, 2007

Boomers and Employment

The recent news about immigration legislation has reminded me of some demographic information I heard about the impact on the labor force that the retirement of Boomers will have. America has a relatively low unemployment rate today compared to previous decades and the demand for employees has been great enough for 12 million illegals to come to the US to find work. I don't expect that too many of those jobs will be in great demand by Boomers or other demographic segments but one must think what will happen to unemployment when an increasingly large number of boomers retire each year.

Here's a thought that employers could consider to help ease the transition, retain some of institutional knowledge and skills of their older workers and control some labor cost increases. What if employers offered Boomers extra weeks of vacation instead of pay increasees? Rather than give an employee a 4% raise in cold hard cash, how about giving them an extra two weeks of vacation? Older workers often have additional time commitments for family obligations, health care and elder care and this would address some of those time pressures. Eliminating the increase in wages among the older and higher paid workers may also have some appeal to employers. Learning how to use additional free time over a period of years rather than all at once may also have some benefit to the older worker.

Implementing policies like this for workers once they hit a certain age - say 58 or 60, may be a win win situation and a real competitive advantage for employers. The Boomers who were born in 1946 are turning 61 this year. Many of them will be transitioning from the workforce over the next 10-15 years. Something to consider.

PS Some restrictions on the additional vacation time could be established so employees aren't gone for months at a time. Taking two Fridays off a month would take 4-5 weeks of additional time off accumulation.