For the past two decades, the editors of Trends have been explaining
why the traditional concept of retirement is destined to vanish by the second
decade of the 21st century. This is becoming increasingly evident. The Bureau
of Labor Statistics foresees a shortfall of 10 million workers in the United
States by 2010. Let’s look at how society and business will have to change
for the coming new era.
In the next decade, 76 million people — more than one-quarter of all
Americans — plan to retire. And there won’t be enough young people
to fill the vacated jobs.
During the next six years, for every new member added to the work force, 2.6
new jobs will be created. That means we’ll see labor shortages in virtually
every job.
These demographic trends portend big changes in the next 10 years. What will
they mean for your business? In “It’s Time to Retire Retirement,”
in the March 2004 issue of the Harvard Business Review, Ken Dychtwald,
Tamara Erickson, and Bob Morison point out three ways the retirement of Baby
Boomers will change the workplace:
- Workers will be harder to come by.
- Tacit knowledge will leave the organization.
- The most dramatic shortage of workers will hit the age group associated
with leadership and key customer-facing positions.
In order to prepare, employers will need to know exactly where the labor market
is headed for their specific industry or profession. And of course, they’ll
need to know what to do about it.
One way we can address the coming shortage is by reassessing our notions of
retirement. There are three good reasons why we should stop viewing it as an
irreversible event that separates work life from leisure:
Necessity. Most people can’t yet afford to stop working. A surprising
number of Americans are unprepared for retirement. They might, for example,
need to keep their jobs for their medical benefits. Mandatory retirement won’t
help that.
Demographics. Actuarial assumptions haven’t kept up with the
surprising advances in longevity. People live longer and are in better health
than ever before. The age of 65 no longer means what it used to mean. Aging
societies force companies and markets to re-examine their basic...
