Ready or not, Milwaukee employers will soon be confronted by a severe labor shortage caused by a cascade of aging and retiring baby boomers, who will be followed by a much smaller generation.
The demographics for the year 2015, according to projections by the U.S. Census Bureau, are jaw-dropping:
• The number of Wisconsin residents age 55 to 64 will grow 37 percent to 777,968 people.
• The number of Wisconsin residents age 65 or older will grow 22 percent to 881,745 people.
• But the number of Wisconsin under the age of 55 will fall 2.2 percent to 3 million people.
A new report by Senior Service America, a nonprofit organization based in Silver Spring, Md., that helps senior citizens re-enter the workforce, said Wisconsin’s labor shortage will be particularly acute.
“Findings reveal that Wisconsin will be substantially impacted by the graying of its population over the coming decade and will outpace demographic developments across the nation and in the vast majority of other states,” the report states. “All of the growth in the working-age population of Wisconsin (by 2015) will be generated by persons 55 and older … The graying of the Wisconsin population will clearly accelerate after 2010 in the absence of a substantial increase in either domestic in-migration or a sharp rise in foreign immigration.”
The agency says Wisconsin employers will need to change in many ways to adapt to the state’s aging workforce.
“Over the next 10 years, most employers will have to markedly increase the number of older workers on their payrolls and restructure existing internal training and hiring systems to accommodate older workers,” the report states.
Before employers look to train unskilled workers or entice college students and young professionals to stay in the Wisconsin workforce, they are going to have to work with their older employees to find ways to keep them on board even after they plan to retire.
“We are lucky in a perverse way that many boomers have not planned well enough for retirement – they will be seeking to continue to work and earn an income,” said Sammis White, director of the University of Wisconsin-Milwaukee Center for Workforce Development, associate dean of the School of Continuing Education and professor of urban planning. “But employers must be convinced that they should look to the boomers as part of the solution for the impending worker shortage. They definitely must be.”
Many older employees are looking for new benefits from their jobs, including flexible hours, job share opportunities and the ability to work from home. They don’t always want the responsibilities of carrying high-level, high-pressure titles.
They still want income, but they want to ease their way out of the workforce, according to Patrick Zmuzinski, managing director of the Midwest practice of Spherion Professional Services Group, a division of Spherion Corp., Fort Lauderdale, Fla. Zmuzinski is based in Pewaukee.
Most importantly, employers need to acknowledge that it increasingly is a job seeker’s market that will grow even more severe in the years ahead.
“Employers have to operate in reality. A lot of times, people get into this fictitious world of perfection where they think they have a job opening and someone will fill it,” Zmuzinski said. “The workforce right now is by far the most intelligent workforce we have ever had when it comes to how they market themselves. Many are willing to take their talent and go elsewhere, and a lot of companies don’t realize that. They think there is this fictitious glut of candidates and talent just waiting to beat down their door.”
Flexibility will be key
Carol Schneider, chief executive officer of Grafton-based Seek Careers/Staffing Inc., is 70 years old. She has no plans to retire anytime soon, and she is doing what she can to retain her best employees.
“I want them back on whatever terms they want to come back,” Schneider said. “The other thing I do is I have women with children who want to be stay at home moms. And I have asked if they would like to help me from home if we hooked up a computer system and they could do recruiting. Sometimes it works, sometimes it doesn’t.”
For example, Mary Lou Harris currently serves as client services coordinator for reEmploy, a company recently acquired by Seek (see accompanying story). Harris retired from Seek in October and was brought back on in a part-time position by Schneider.
“I hate to lose good people, whatever age they are,” Schneider said.
Milwaukee-based Cleaver Brooks Inc. has been slammed by the shrinking labor market, said Earle Pfefferkorn, president of the company’s C-B Package Boiler division. The heat transfer industry as a whole is experiencing an engineering shortage. The boiler industry has actually not changed much in the last 50 years, and older employees are not only revered, but they are the most knowledgeable about how the business is best run.
Cleaver Brooks has created innovative ways to attract and retain good people in the workforce and ensure the continuation of the company by training them to be leaders.
“The graying of the industry is here,” Cleaver Brooks spokesman Steve Connor said. “A lot of boiler and service technicians are getting to the point where they are facing retirement and are close to it.”
The company created the Cleaver Brooks Representative Association (CBRA), a training program for its service technicians. CBRA also offers opportunities to people who have electrical backgrounds but are not trained in boilers.
To combat the graying of its workforce while recruiting and retaining younger employees, Cleaver Brooks started a mentoring program about two years ago. Older workers are paired with younger workers to share their experiences and mistakes, helping the younger workers move more quickly up the ladder, Pfefferkorn said.
“(The younger employees) benefit from 40 years of experience,” Connor said. “And to see them capitalizing on some knowledge that exists around here is rewarding.”
The mentoring program has had a positive influence on the overall attitude and work environment at Cleaver Brooks, Pfefferkorn said.
“There is a young lady, about 29 years old and has been with the company under 10 years, but you would not believe how much she has progressed,” Connor said. “She was just promoted to manage the marketing communications area, and someone who reports to her is older than she is. She has gained the respect of individuals and is now in charge of re-branding the company after 75 years. A lot of that has to do with the mentor program.”
The benefits of the mentoring program flow both directions.
“I will be 65 in June, and the company has been very encouraging with me,” Connor said. “As long as my health holds, no one is forcing me out the door. Earle and his group have taken full advantage of what I have learned from 40 years in the industry.”
Employers of choice
Companies that are being proactive to address the labor shortage will have an advantage over firms that will simply wait until it hits them directly, according to Jessica Ollenburg, president of Human Resource Services, Inc., an assessment, recruitment and development company based in Waukesha.
With the end of the era of pension plans, candidates young and old will be looking for jobs at companies with good reputations that inspire trust and provide personal flexibility, Ollenburg said.
“It is still shocking how many employers are not recognizing that there is a shrinking labor market, and they are not addressing it,” Ollenburg said. “It amazes me that we are still trying to get people to buy into the basic premise in order to find the solution. If we had the complete buy-in from employers, the cultural change that is necessary could be a concerted effort.”
One such outreaching effort is being made by Interfaith Older Adult Programs, a Milwaukee-based non-profit organization that reaches out to isolated elderly people. In January, Interfaith sponsored an editorial roundtable with Small Business Times at the UWM School of Continuing Education.
Pat Delmenhorst, director of employment services for Interfaith, said the goals for the roundtable were to bring awareness to the local business community and identify barriers facing employers, including: the high costs of health care and worker’s compensation for older employees; the loss of intellectual property and skills when older employees retire; the gap between the available labor pool and the available jobs; and the lack of formal succession plans.
The roundtable found that the barriers older employees face include: age discrimination; concerns that opportunities for mature workers at lower levels may take jobs away from less-skilled workers; lack of financial security; lack of company-sponsored training programs; and the need for job redesign as a tool for retaining workers.
The Interfaith roundtable continues to meet and is considering taking some action steps, including forming a committee that would include business leaders, local colleges and universities, workforce development partners and city and county government representatives. The committee also would engage employees.
Although the committee is still in its development stages, the UWM School of Continuing Education has already jump-started public involvement in a solution with its “Stay Ahead of the Boom Conference: Create Your Best Life!” The event will take place April 14 and will offer multiple workshops, addressing employment options, lifestyle issues and financial goals and status, said Jennifer Riggenbach of the school.
Employers need to recognize the individual needs of their older employees when trying to compromise to keep them on the job, said Chuck Hays, owner of Retirement Directions LLC in Glendale.
Hays is a lifestyle and retirement consultant, and most of his clients are in their 50s.
“The (age) decade of the 50s is called the decade of decision,” Hays said. “Most people reach the pinnacle of their careers when they are in their 50s. They are in a position where they are as high as they are going to get or want to get. Life starts to change when the kids are out of the house and they start to look at the internal, emotional, psychological, spiritual meaning of life. Who they want to be, what they want to do and how they want to contribute.”
