How Retiring Baby Boomers Affect an Employer’s Hiring Plans
Sharita: Welcome to “The Animal Health Employment Insider,” brought to you by The VET Recruiter. In this podcast, search consultant Stacy Pursell, founder and CEO of The VET Recruiter, provides insight and practical advice for both companies and job seekers in the Animal Health industry and Veterinary profession. The VET Recruiter’s mission is to help Animal Health and Veterinary organizations acquire top talent, while helping Animal Health and Veterinary Professionals attain career-enhancing opportunities that increase their quality of life.
In today’s podcast, we’ll be talking about how the retirement of the Baby Boomers can affect an employer’s hiring plans. Welcome, Stacy. Thank you for joining us.
Stacy: Hello, Sharita. I’m glad to be here today.
Sharita: Stacy, this is the first time that we’ve talked about the Baby Boomer Generation on our podcast. That’s a little surprising, since they’re an important part of the workforce.
Stacy: Yes, that’s true. While the national focus has been on Millennials during the past few years, Baby Boomers are also playing a critical role in the employment marketplace at large. Their role is different than that of Millennials, but the impact they’re having is nearly as great.
Sharita: What kind of impact are they having?
Stacy: They’re retiring in droves! In fact, most of the Baby Boomers in the United States will be phased out of the workforce during the next 15 years. According to the Pew Research Center, over the next two decades, 10,000 Baby Boomers will turn 65 years old every single day.
Sharita: Wow, that is a LOT of people retiring!
Stacy: It certainly is, and we’re not talking about a small percentage of the workforce, either. Baby Boomers make up roughly 30% of the U.S. workforce. And there are two big ways this is having an impact on the employment marketplace.
Sharita: What ways are those?
Stacy: First, there’s the obvious fact that 30% of the workforce is pretty much going to disappear. That begs the question: who’s going to replace them all? At the rate they’re retiring, there are far more people leaving the workforce than entering it.
Second, the Baby Boomers are taking a tremendous amount of experience and expertise with them! This is experience and expertise that is very valuable to employers, and once the Baby Boomer retire, it’s gone. That can present problems for organizations in the Animal Health industry and Veterinary profession. It’s bad enough that they have to replace valuable employees, but it’s even worse when the people they hire to replace those employees don’t have nearly the same level of knowledge or experience.
Sharita: What should organizations do to plan for this?
Stacy: Ideally, they should already be taking steps and measures, since the retirement of the Baby Boomers is underway. However, even if they haven’t, there are things they can start doing right now to help their situation and remain as competitive as they can possibly be.
The first step for company officials is to identify those employees they value the most and who are the most likely to retire soon. This should be easy to do, but you shouldn’t wait too long to do it. You never know when an employee is going to walk into your office and announce their retirement. By that time, it’s pretty much too late.
Sharita: Stacy, is the second step for company officials to meet with those employees that they identify?
Stacy: That’s correct. And when you meet with them, you must ask them some specific questions about their future. That includes asking when they think they’ll want to retire. Hopefully, you already have a good working relationship with them, since they’re among your most valued employees. If that’s the case, then having the conversation should be easier than it would be with someone else.
If possible, company officials should nail down some kind of timeframe for when the employee plans to retire. They should also emphasize to the employee how valuable they are, and that’s why they’re asking these questions in the first place.
Sharita: Stacy, what’s the third step?
Stacy: The third step is to create a process for knowledge transfer. Yes, the organization will hire somebody to replace the person. That might or might not be in the near future. If the organization hires somebody now, then company officials need to transfer the knowledge immediately to the new hire before their valued employee retires. If the hire is made at a later date, all the specifics of the process should be put into place.
The priority is to make sure that the organization’s valued employee does not retire until the knowledge transfer has occurred.
The fourth step involves deciding if anyone will succeed the employee from within the organization. If that is the case, then the process of knowledge transfer can begin at any time. This step underscores the importance of the first step. You must identify which of your top employees are likely to retire in the near future. That way, you can decide whether or not you’ll replace them internally and allow for plenty of time for the knowledge transfer and training to take place.
Sharita: What if company officials decide that there are no viable candidates internally? What happens then?
Stacy: This is where the real work begins from the perspective of the hiring manager. That’s because this is when they must consider and implement the hiring options that are available to them. Specifically, they must have a plan for identifying viable candidates and also for recruiting those candidates for the position. As we’ve discussed before, the top candidates in the marketplace are typically passive candidates. Again passive candidates are those individuals who are usually gainfully employed somewhere else and not actively looking for a new job.
However, there’s one option that some hiring managers don’t often consider, but it’s one that they should consider.
Sharita: Which option is that?
Stacy: It’s called retiree re-staffing. In this kind of situation, the employee officially retires, and then you bring them back on a contract basis. That way, you can still retain their knowledge and buy yourself some time.
Sharita: You mean once they retire, you can still hire them back?
Stacy: That’s right, although their employment is different the second time around. The organization is hiring them on a contract basis, as opposed to a direct basis. That means they could work on different days of the week and maybe even for fewer hours each day. In fact, there are benefits for both the employee and the organization in this type of situation.
First, the organization can retain the experience and expertise that might have otherwise been lost, which we’ve already discussed.
Second, the organization can arrange to have that knowledge and expertise transferred to other workers, which we’ve also discussed.
Third, the employee can maintain a flexible work schedule, which is important to them at this point in their career.
And fourth, the employee can earn money to supplement their retirement income.
Sharita: So this isn’t a one-sided arrangement at all?
Stacy: No, absolutely not. This is the kind of win-win situation that can happen in the marketplace, where both parties get what they want. It’s a great situation, too, considering what’s at stake for organizations in the Animal Health industry and Veterinary profession.
You know, I tell candidates all the time that to be in the best employment situation possible, you need a lot of options. When you have a lot of options, you can make better decisions and have a better outcome. The same philosophy applies to employers in terms of hiring, and especially when it comes to the retirement of the Baby Boomers.
Employers need to make sure they have hiring options at their disposal. Without options, they may find themselves backed into a corner. And when you don’t have a lot of options, you become more desperate and the outcome isn’t nearly as good. Re-hiring retirees on a contract basis is one of those options, and it’s a good option for employers.
Sharita: What if an employer in the Animal Health industry or Veterinary profession has never hired a retiree on a contract basis before? What if they’ve never hired anyone on a contract basis before?
Stacy: Well, if they’re working with an experienced recruiter, their recruiter should have knowledge of hiring on contract. They should act as a valuable resource and as a consultant about what must be done and how it should be done. And I think this brings up a very important point as we reach the end of our time today.
Sharita: What’s that?
Stacy: Recruiters are also known as search consultants for a reason. They serve as a consultant to their clients. They should be a source of information and expertise that clients can rely upon. If a hiring manager has questions about the options that are available to them, they should be able to contact their search consultant and gets answers.
Recruiters and search consultants do more than just identify and recruit top talent to fill their clients’ open positions. They’re available to their clients to answer any and all questions regarding the employment marketplace, the candidates within the marketplace, and what they must do to stay competitive. Although sometimes the company officials at those clients are not 100% pleased with the answers they receive.
Sharita: That certainly does make sense! Stacy, thanks so much for being here today and for talking about the retirement of the Baby Boomers and what it means in terms of the hiring landscape.
Stacy: Thank you, Sharita. I look forward to our next podcast!