Faced with a significant number of employees at or nearing retirement, and the resulting loss of valuable older workers, U.S. employers are rethinking their approach to managing the retirement patterns of their workforces, according to a new survey by Willis Towers Watson. The 2018 Longer Working Careers Survey found the vast majority of employers (83%) have a significant number of employees at or nearing retirement. However, only half (53%) express having a good understanding of when their employees will retire. Additionally, while 81% of employers say managing the timing of their employees’ retirements is an important business issue, only 25% do this effectively.
According to the survey, 80% of respondents view older employees as crucial to their success. Not surprisingly, employers are concerned with the expected loss of talent. In fact, over half (54%) believe the loss of talent due to retiring workers will be more significant than other labor market risks over the next five years. Additionally, 50% expect difficulty finding workers with similar knowledge and skills over the next five years; 48% worry about the loss of organization-specific knowledge.
The research found employers are also concerned over workers delaying retirements. Almost half (49%) expressed concern that delayed retirements will increase benefit costs over the next five years, while 41% are concerned they will increase wage and salary costs. Almost four in 10 (37%) worry that workers who stay on the job past normal retirement will block promotions for younger employees.
According to the survey, a majority of employers either have adopted or plan to adopt one or more of the following strategies over the next few years: wellbeing enhancements, flexible employment, consulting arrangements, or phased retirement.
To read more about the survey, click here.