Need for older workers grows as demographics change.
As the baby boom generation enters retirement age, New England employers will become increasingly dependent on older workers--those aged 55 and above to meet the demand for skilled workers. To prepare for the future, private and public leaders must begin to craft strategies now which will remove obstacles for many older workers who desire to stay in the workforce beyond retirement age.According to a report prepared by Northeastern University's Center for Labor Market Studies, these changing demographics in New England could ultimately stall economic development and job growth in the future. The numbers are significant in New Hampshire, which the report indicates has a larger and more rapidly growing share of the older population.
The study finds that--despite New Hampshire's status as one of the states in the Northeast still able to generate substantial net inflows of residents from other states--slow rates of natural increase in the population and still limited foreign immigration in New Hampshire mean a slower-growing and aging population. These trends predict a continued slowdown in the rate of growth in the size of the state's labor force in the coming years. An overwhelming share of New Hampshire's labor force growth in the future will be among those aged 55 and over.
Some of the report highlights:
* The state's median age is higher than that of the nation as a whole. The state is projected to have a rapidly aging population and has experienced a low birth rate. In 2004, New Hampshire had the third-lowest birth rate in the nation.
* During 2005, the estimated size of the 55-to-64-year old population was just over 147,600. By 2015, this number is expected to increase by 40 percent. Similarly, the resident population of those aged 65 or older will increase by about 38 percent in the same time period. The projections also note only a 2 percent growth in residents tinder 55 in this time period.
* From 2005 to 2015, about 90 percent of the net increase in the size of the New Hampshire working age population is forecast to be among those 55 and above.
* The share of persons in the working age population of teens and young adults will fall by 2 percent and that of older prime-age workers ages 35 to 54) will decline by 6 percent during the same period.
There is no doubt that the need for well-educated and well-trained younger workers continues to influence government policy. But the demographic analysis clearly demonstrates that unless the labor force attachment of older workers increases sharply, the graying of the workforce will result in labor shortages that will hamper economic growth.
The New England Council recently partnered with Mercer Human Resource Consulting to launch an initiative focused on this issue. The project will likely result in public policy proposals for the nation's retirement system as well as workforce development programs to encourage employment of older workers.
There were 35 million people at retirement age in the United States in 2000. By 2030, there will be 70 million people ready to retire. By 2020, forecasters expect that there will be more jobs than workers.
New England, which is lacing little or no labor force or population growth in the next decade, will be particularly challenged by these changing demographics.
We need to develop specific proposals to encourage the active engagement of older workers in the employment market. Some of these strategies range from age-specific training programs to increasing funding for incumbent worker training to the creation of new definitions or categories of employees that would alleviate obstacles to mixing work and retirement.
New England could experience a significant gap of available employees and skilled worker shortages that ultimately will hinder our ability to add jobs and grow. The time to craft these proposals is now.
James T. Brett is president and chief executive officer of the New England Council end James McCaffrey is New England market leader for Mercer Human Resources Consulting.
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| Author: | Brett, James T.; McCaffrey, James |
|---|---|
| Publication: | New Hampshire Business Review |
| Geographic Code: | 1U100 |
| Date: | Feb 16, 2007 |
| Words: | 655 |
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