How Retiring Baby Boomers Affect the Job Market
The Impact of the Aging Workforce on the Technology Industry
Baby boomers belong to the generation born between 1946 and 1964. The oldest members of the generation reached retirement age (or 65-years old) in 2011, and the youngest members will reach this milestone in 2029. By that year, nearly one-fifth of the U.S. population will be 65 or older, and during the 18-year period between 2011 to 2029, about 10,000 baby boomers are expected to reach the age of retirement age each day.
As baby boomers retire, the technology and IT industries will feel the impact in a variety of ways:
Flexibility in the Workplace
The baby boomer workforce is changing the way Americans work by bringing new measures of flexibility to the office. Companies are finding that employees in this age group demand different working conditions than younger colleagues.
Boomers are less interested and less obligated to work long hours, partly due to their ranking status in many offices, and partly because they're less defined by their career ambitions than younger colleagues. "Quality of life" and "work-life balance" have become key phrases thanks to aging baby boomers, as well as the concepts of job sharing, part-time work, and flex scheduling.
Younger Americans have a better chance of finding a career that offers these benefits because baby boomers have brought the idea of work-life balance to employee negotiations.
More Job Openings
As baby boomers retire, there are fewer workers to replace retirees in positions that require specific, practiced skillsets. This is causing what's referred to as a "knowledge gap" wherein a high demand exists for specialized employees who have yet to enter the workplace and receive the training necessary to replace more experienced workers.
Retiring baby boomers are more tech-literate than their parents, and will be taking full advantage of social media and internet-connected devices like tablets, smartphones, and other "smart" technologies. It follows that technology will be more heavily marketed toward retirement-age consumers in the years to come, and there will be opportunities for innovation with the influx of new and more frequent users of personal technology.
Later Retirement Age
Despite the economic ideal of their parents' generation, full retirement at age 65 is not financially viable for hundreds of thousands of baby boomers, and for those born in 1960 or later, Social Security benefits won't be available until age 67. As a result, many baby boomers will need to continue working part-time, to support themselves and their dependents.
This is a double-edged sword if you’re seeking employment because the niche you want to fill may still be filled by someone who just can’t afford to retire.
If you're a young person looking for employment, a good strategy to counter this phenomenon is to make sure you’re specialized in more than one technical skillset. This way, you don’t necessarily have to wait for a long-standing position to be vacated in order to get your foot in the door.
Wage Increase in Specialized Vacated Positions
When there are jobs available and not enough workers to fill vacancies, wages go up to attract and retain the necessary workforce. The retirement of baby boomers en masse will create such an environment, and according to the U.S. Bureau of Labor Statistics, a majority of tech-related positions are projected to have a salary increase.
Because it can take a long time for new workers to acquire the skills needed to replace seasoned professional, tech companies will put pressure on the government to increase the number of new visas approved in a given year—most notably, the H-1B visa. This means that the tech economy, faced with a shortage of American workers, will look to import the help they need to keep their products moving.
As the premier generation of technologically specialized American workers prepares for retirement, the opportunity and the challenge for subsequent generations becomes clearer with each year. To beat outsourced talent to the punch, and to earn the higher wages and greater job security promised by filling in for the baby boomers, Americans must address the knowledge gap with specialized, technologically driven learning.