Last month, I suggested that some facts and statistics might help to tune the mind to the seriousness of the retirement problem faced industry – and not just Big Oil.
Since then, I have been mulling over the old saying about lies and statistics. But the weight of real evidence is too compelling to relegate the issues that we face to the back burner.
It is interesting, is it not, that the media are paying the subject so much attention?
I know that my mind is tuned to the subject matter of retirement (even if mine is still some way off, incidentally).
A recent Deloitte survey suggested: “Worryingly, just 13% (of the survey) identified approaching baby boomer retirement as a concern, despite overwhelming evidence indicating a large exodus of experienced staff from the labour market in the next three to five years.”
Surely, it’s more than 13%? My discussions with various folk would tend to bear this out.
Had the situation been a big surprise, one might be more forgiving, but to quote a MetLife Mature Market Institute study, “One of the most anticipated workplace trends of the 21st century is the huge retirement wave that will hit most industrialised countries, including the US, in the next few years.
“But surveys consistently report that most companies are unprepared to respond to the seismic shifts that are expected to appear in the workforce”.
On the irony side of life, it’s a bit like arriving at an airport on a late running flight, (desperate, of course, to make a connection) and the announcement comes up to let you know you will be buckled up for an indeterminate time because the gate isn’t ready.
What? They didn’t know we were arriving? Maybe I am fast becoming an audition candidate for Grumpy Old Men.
Ira S. Wolf, in Stop the Brain Drain, points out: “The alarm that has been ringing in the ears of senior managers and business owners lately has become louder and more painful as they see retirements and job-hopping drain their organisational ‘brain power’.
“It has become all too obvious that companies have not done a very good job of documenting and retaining the knowledge of their key personnel and subject matter experts.”
Every organisation can learn a lesson from BP. In February, 2006, a small leak in a quarter-inch hole in the Prudhoe Bay pipeline was discovered.
By August, 2006, oil spills forced a shutdown of the largest US oilfield. Overnight, 8% of US domestic oil production was shut down and a large amount of crude was spilled.
A Congressional investigation followed and it was discovered that BP’s senior corrosion engineer had retired just a few years earlier.
The job had been left unfilled for more than a year, creating a huge knowledge gap.
This vacancy, and others, hindered BP’s ability to maintain a strategic view of its corrosion prevention activities.
On the subject of knowledge gaps, Jay Jamrog, SVP of research at i4cpc, suggests: “For all the public gnashing of teeth about the impending retirement of all those knowledgeable, hard-working baby boomers, relatively few organisations are doing much about it.
“They’re going to wind up in a mad bar-the-doors scramble in the near future if they don’t start trying to tap the knowledge of their most knowledgeable boomers.”
And David DeLong, in his highly recommendable book, Lost Knowledge – Confronting the Threat of an Aging Workforce, points out that “retiring baby boomers are taking with them years of institutional memory in many fields”.
Another worthy read recently penned by Ira S. Wolfe is The Perfect Labor Storm: Workforce Indicators, Statistics, Facts and Trends. It hardly trips off the tongue, but provides plenty of interesting data.
It says that, by 2010, we will have 167,754,000 skilled jobs to fill in the US alone. By 2010, we will have only 157,721,000 people in the workforce to fill those jobs. Between 2000 and 2030, the US population will grow by 26%. The 65 and over segment will grow by more than 80%.
Before you think I am majoring on the US, in another report by Deloitte, a section entitled The Sad Statistics of the Global Labour Pool states: “By 2008, a wealth of skills and experience will begin to disappear from the job market. The first members of the baby boom generation will turn 62, the average retirement age in the large, developed economies of North America, Europe and Asia.
“Over the next 15 years, 80% of their workforce growth will occur among people 50 years or older. By 2050, 40% of Europe’s total population and 60% of its working age population will be people over 60.
“With mounting pension obligations and shrinking workforces, Germany, Italy, Spain and Japan could face economic crises.”
As management guru Peter Drucker has suggested, the confluence of a bulging aged population and a shrinking supply of youth is unlike anything that has happened since the dying centuries of the Roman Empire.
Feeling your age? Is it realised that many of you who implemented early-retirement policies, including in the oil industry, will find yourselves on the scrap heap years ahead of time? What a rich irony.
In the coming columns, I will select some case studies to help to generate ideas.
In addition to the column being published here, we are placing it on our blog site – The Battle For Experience – accessible from our website, www.ExpertAlumni.com
John Glesinger is CEO of Expert Alumni