What the "Gray Drain" Means to You

The Bureau of Labor Statistics predicts that 43% of the U.S. labor force will become eligible to retire between 2004 and 2012. This means two primary things for middle aged workers.

First, the very make-up of a typical firm is going to go through a drastic change. The archetypical company has been staffed on the basis of a shortage of positions at the top more than a shortage of people to fill them. There are only so many senior management openings but droves of younger workers biding their time for the older workers to move out and make one available. The system has existed for decades and it made perfect sense when the large baby boomer generation filled all those younger positions and the much smaller previous generations staffed them.

But now the pyramid has been turned upside down. The bubble is now at the top. When such a large percentage of senior managers and other skilled workers are nearing retirement, it's no longer certain that companies will be able to tap a large talent base already prepped with the skills necessary to take over. If you want an analogy, think of a sports team made up of aging veterans. If one key player is set to retire it is typically not an issue for the team to find a good replacement. But if too many players leave in too short of a time, a winning team can quickly become a losing team leading to what are called "building years."

For boomers this could be the best of times or the worst of times depending on your perspective. If you've planned your life based on the old model of retirement, you might be in for a shock. This is because the financial aspects of old model of retirement (specifically pensions) were also based on a large number of workers paying for a smaller number of retirees. It's a model that was not intended to handle a large number of retirees and a smaller number of workers. It's simply not sustainable.

Herein lies the opportunity. Middle aged workers who have found careers that they enjoy are in a position to create work environments conducive to their changing priorities. They be able to work on things that they enjoy, remain engaged and active, but also have time for other priorities in their lives. In the past, if a senior worker asked to have a flexible schedule or to reduce their work week, this was seen as an indication that it was time to move that person out and make room for one of the many folks waiting and seen as deserving of that spot. However, in the near future, it is likely that a similar request will be met far more favorably. Instead of viewing that they are losing 1/2 of a worker they might see it as the ability to retain 1/2 a worker that they thought they were going to lose. Progressive companies will be out ahead of the curve working with HR departments on the best way to retain their skilled workforce.

Regardless of your age, this upheaval will affect you and the more that you understand the better you will be able to successfully navigate it.

Oh yes, at the beginning of this post I said that there were two primary ways that workers would be affected by the quickly graying workforce. So what is the second one? It's an over-abundance of cliches describing this demographics shift. Be prepared to be bombarded with snappy yet tiresome phrases like "gray drain" and "silver tsunami" to name a few. It promises to be agonizing and there is no end in sight.