Diversity Insight

The Aging Workforce: Succession Planning and Retention

In yesterday’s Advisor we began to explore how organizations might deal with the very real aging workforce issue. Today we’ll look at more tips, including succession planning and making the most of an older workforce.

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Succession Planning Concerns

Succession planning presents another age discrimination risk. “Costly succession planning mistakes occur when employers look to be rid of older employees in favor of younger employees with long-term potential or when employers fail to consider other older workers to replace willing retirees,” Bohr says.

To minimize risk, employers should work with the worker who plans to retire to develop a plan and timeline related to the impending retirement. “In doing so, the plan should include developing a pool of well-trained and qualified candidates to fill the shoes of departing employees and a timeline for training the incoming employee,” Bohr says.

Capitalizing on Older Workers

 Deloitte’s Global Trends report touts the benefits older workers can bring to their employers but notes that negative attitudes about older members of the workforce present problems.

The report points to the need for employers to focus on retaining older workers and keeping them productive. “Population aging poses a workforce dilemma for both economies and organizations,” the report states. “Thirteen countries are expected to have ‘superaged’ populations—where more than one in five people is 65 or older—by 2020, up from just three in 2014.” The United States is among those countries.

Older workers represent “a largely untapped opportunity,” according to Deloitte, since just 18% of this year’s respondents said age is seen as an advantage in their organization. “But leading companies are beginning to focus on this talent pool as a competitive advantage,” the report says.

“The older labor pool represents a proven, committed, and diverse set of workers,” the Deloitte report says. It also suggests that organizations can benefit from older workers’ serving as mentors, coaches, or experts. “Taking on these kinds of roles allows older workers to ‘pass the baton’ to younger generations, while making room for ambitious younger workers.”

Some employers are experimenting with workplace changes as a way to keep older employees on the job. “For instance, BMW increased productivity on an assembly line staffed with older workers by 7 percent in just three months through simple changes such as providing cushioned floors and adjustable work benches,” the report says.

Other employers are capitalizing on their older workers by encouraging them to reinvent themselves and investing in programs to help them gain new or update old skills. For example, software engineers can use their experience with older technologies to learn new technologies quickly, the Deloitte report says.

Even though older workers can be valuable in many roles, they also present challenges. “Older workers may have specialized workplace needs and can attract resentment from younger workers and they often enjoy higher salaries because of their tenure,” the Trends report says. “Organizations looking to assimilate an older worker population may face the need to design new wage policies, create more flexible rewards programs, and train young leaders to manage people across generations (including team members who may be their parents’ age).”