Changing of the Guard.

Right about the time I was entering the job market I was warned that my generation (the Baby Boomers, born between 1946-1964) were going to ripple through the economy in what is now called the "Baby Boomer Age Wave." The theory is that as my demographic ages it causes ripples in the economy based on various life-cycle spending patterns. Some economists warn of the "peak boomer impact," which will occur when the last of the boomer generation reaches retirement. The crest of the wave, if you will. At that point, peak spending will shift from consumer goods to health care. This is also the period that will place the greatest burden on Social Security.

Image courtesy Wikimedia user Cmglee

Meanwhile there is the Millennial generation (born between 1981-1996). While Boomers make up 21.5% of the population, Millennials are marginally larger at 21.93%. Economists have noted that the life-cycle spending patterns of Millennials is different than their parents; Millennials carry a higher educational debt, they are getting married later in life, and they are having less children. They are entering into an economic period of uncertainty, with income disparity becoming more severe. At the same time, they are optimistic, entrepreneurial, and strive for authenticity.

Not all economists agree that Boomers will reek economic havoc when they retire. Some economists firmly believe that when Millennials reach their peak earning years (45-54) they will more than make up for Boomers leaving the workforce. The real concern among economists is the rising cost of health care, crushing educational debt, and the increasing rate of income disparity among all groups.

How all of this will effect the performing arts industry is an interesting question. An analysis of the data was conducted by the US Bureau of Labor Statistics in a 2016 report. The results suggest that older populations (65-74) spend more of their personal income on entertainment than those of other age groups. So in theory the arts should enjoy an uptick in participation as Boomers spend more dollars on entertainment in retirement.

Despite the economic advantages that Boomers have enjoyed over the years, the challenge in the workforce at the moment is that they are not actually retiring as expected. There are a few factors that influence this phenomenon:

• Many baby boomers do not have enough saved for retirement. The 2008 financial crisis, market volatility, and increasing cost of living have significantly impacted their retirement savings. The decline of traditional pension plans in favor of defined contribution plans like 401(k)s has shifted more retirement planning responsibility onto individuals, which can be challenging.

• People are living longer, healthier lives, which means their retirement savings need to last longer. This can prompt Boomers to delay retirement to ensure financial stability throughout their extended lifespan.

• Many Boomers still find personal satisfaction and a sense of identity in their work. Continuing to work can provide a sense of purpose and social engagement that they may not find in retirement.

• Perhaps ironically, the lack of affordability in the housing market suggests that Boomers have to continue to support their Millennium children until they can purchase their own home.
  

Setting aside financial considerations, whether their productivity is declining, or they are less motivated, or they spend their days saying "that's not how we used to do things," employees that are already at retiring age but aren't willing/able to make the leap can be a challenge for the manager. It can also be a struggle for their peers and the people who are supervised by them. You can drop as many hints as you like, but if they may not be inclined to take the hint. At the same time, taking the direct approach could put you at odds with HR, since coercion is a big no-no in terms of age discrimination.

So how do you value an employee's experience and contribution to the organization while at the same time convincing them that it's time for a changing of the guard? To start, it's helpful to understand which of the common factors above apply to the situation. Engage in open and honest conversations to understand their reasons for continuing to work. Are they concerned about finances, or do they enjoy the social aspects of work? You can work to address any concerns they have about retirement, such as healthcare, income stability, or a sense of purpose. Does your organization provide access to financial planners who can help them assess their readiness for retirement? Perhaps you can recommend seminars or workshops that cover topics like managing retirement savings, social security benefits, and healthcare options. Another option could be a phased retirement plan where they can gradually reduce their working hours while mentoring younger employees. You could also offer consulting positions or part-time roles that allow them to stay engaged without the demands of full-time work.

The main objective is to help the employee envision their future retirement lifestyle. Spending this time with the retiring employee should be a key element of every succession plan. By the way, if you're avoiding this conversation because you are concerned about finding and hiring their replacement, you're part of the problem.

Lucius Quinctius Cincinnatus was a Roman statesman and military leader in the 5th century BCE. He had retired to his farm, leading a simple life of farming. In 458 BCE, Rome was threatened by the Aequi, a neighboring tribe. The Roman Senate called him out of retirement and appointed him as dictator, a position that came with extraordinary powers. He accepted the call to duty and took command of the Roman army.

He quickly organized the troops, defeated the Aequi, and saved Rome from the immediate threat. After his victory, Cincinnatus resigned his dictatorship and returned to his farm, just 15 days after taking command. He relinquished his power voluntarily and returned to his simple life. More than a few Boomers should follow Cincinnatus' lead. I for one am more than ready to pick up the plow.