Press Room

Wanted Older Workers - No Longer Seen as a Liability, Seasoned Workers May Hold Keys to Business Success

Posted on September 08, 2006

By Lisa A. DuBois

First appeared in the Summer 2006 issue of Vanderbilt Business magazine. Reprinted with permission.

Erica Whittlinger's job running a money management firm was exciting, high-powered, lucrative, fast-paced—and it was killing her. She began suffering from heart problems and realized that if she kept up her current lifestyle, she was literally going to die at her desk. Instead, she sold her company and entered into a partnership as a founding member of The Refirement Group, a consulting firm that helps individuals and corporations prepare for the shifting demographics of the American workplace. As a sideline, and for fun, the 56-year old Whittlinger, '72, also spends her winters teaching ski lessons to adults at a Utah ski resort.

"I'm now in the sub-basement of the instructor hierarchy," she says with a laugh. "After being my own boss, it's interesting for me to suddenly have a boss after all these years. So far, I've successfully managed not to tell anyone how they should be running a ski school!"

Joe Rolwing spent the first 27 years of his professional life working in the not-for-profit sector. By the time he'd reached his mid-fifties, he was feeling unfulfilled. The work was no longer challenging, he wasn't growing intellectually, and he found himself belaboring the same kinds of problems over and over. He had entered into a comfort zone, he says, which was causing him to doubt his value as a contributing member of the workforce. Like Whittlinger, Rolwing came to a life-changing decision and made a risky mid-career move. He accepted a new job as the director of the Life Sciences Center for Cumberland Emerging Technologies, a scientific-business incubator for early stage pharmaceutical research projects. He also heads up the Tennessee Biotechnology Association, a trade group formed to promote biotechnology ventures within the state of Tennessee. At age 62, he provides a certain stability, an anchor, in a business enterprise fraught with youth, derring-do, and volatility.

Rolwing says the owners of the Life Sciences Center were specifically looking for somebody older, independent, self-motivated, and with a good business record. "Most of our tenants here are scientists, but they don't have much practical business knowledge," he explains. "I think I've been a fairly good resource for them. And I have experience networking so that if they have a particular problem, I may know of someone who can help them solve it."

Whittlinger and Rolwing are examples of a growing trend in the American workforce. As they age, they are choosing to ignore the standard concept of retirement and instead are retooling their careers so that they can remain productive, active, viable members of the professional labor market. They are doing so by capitalizing on and sharing knowledge and expertise they have acquired over decades of white-collar employment.

As the notorious Baby Boom generation (those born between 1946 and 1964) continues to mature, economists predict a tectonic shift in American industry due to the enormous number of people set to cash in on their pensions. Right now, nearly 20 percent of the American population is age 55 or older. By the end of the next decade, 76 million boomers may be ready to retire. The alarm bells are just beginning to sound for employers, warning of the dearth of comparable younger workers coming along behind. In fact, some experts predict a future shortage of up to 10 million workers.

According to recent census data, in 1955 the age distribution of the American population was shaped like a pyramid—with a large base of children at the bottom and tapering upwards into a very small apex of elderly citizens. In the first decade of the 21st century, however, the populace has bulked up into more of a dome shape, with a growing number of people at the mid-line, around age 40 and above. Given that Americans are living longer, what this means is that in the next 10 to 20 years either vast numbers of people will be spending almost as many years in retirement as they did in the workforce, or that corporations will have to adjust their employment policies and market strategies to accommodate older workers.

These morphing demographics present an unprecedented challenge to U.S. businesses. They also pose, for those savvy enough to get in on the front end, the kinds of ripe opportunities that haven't been seen since the biotechnology boom of the 1980s and '90s. All that's needed is a modern-day version of Bill Gates or Steve Jobs to step up and figure out how to tap into the goldmine. "The high-tech bubble was so huge in the 1990s, and likewise there has got to be a lot of money to be made in the retraining and reconfiguring of companies to accommodate baby boomers. We are talking about millions of people and thousands of companies, which translates into a potential fortune waiting to be made," says Paul Frankenberg, E '03, president and cofounder of Kraft Search Associates, LLC, a retained executive search firm focused in the health care and financial services industries.

From his vantage point, Frankenberg sees the competitive advantages that more senior personnel can bring to the table. "People well into their forties and older, as a generation, are not ready to check out," he says. "They've gone through the changes of the '70s, '80s, and '90s, they've gone through the introduction of computer technology, and they are competent enough to adapt to anything revolving around working hard and doing global business. Their maturity, communication skills, and soft skills are so valuable that they often beat Generation X workers hands down."

In spite of that, most businesses are geared to court and recruit the younger employee. Many soon find, however, that the "core values" of Generations X and Y are not the same as those of the baby boomers. "Boomers love their titles, their perks, their status. They love visible rewards," says Whittlinger. "I knew when I got my MBA I could join a company and after 18 months I would get a promotion and a bump in my salary, and maybe even get a better desk. But for young people today, lifestyle is number one."

Frankenberg agrees. He says boomers understood that if they wanted to advance in their careers and land a better job, they would likely have to relocate. Complying with the status quo, they dragged their families from place to place as they climbed the corporate ladder. Their successors, on the other hand, are far less interested in moving around. Instead they prefer to choose someplace to live and then find a company in that area.

"They don't say, 'I want to work for GE,' but rather, 'I want to live in Denver, so find me a job where I can do what I do and live in Denver.' The statistics are staggering in the number of times people will change jobs and even change industries, but remain in the same city," he says.

A company's stability, however, depends upon the retention of its best workers, no matter what age they may be. For that reason, Whittlinger's firm, The Refirement Group, helps seasoned employees get in touch with their core values so they can make adjustments to feel happier at work, to plan for the future, and to fire up their careers. Sometimes that entails helping individuals get control of their personal finances, helping them find volunteer activities outside of work, or arranging a more flexible work schedule or shorter hours. The bottom line is that to remain successful, corporations are going to have to restructure and adapt along with their workers.

Even if boomers weren't forcing these changes, says Whittlinger, the huge ethnic and racial shifts occurring in this country make them inevitable. "Half of the net workforce is going to be Hispanics and Asians, and a growing number of people define themselves as multiracial," she explains. "Meanwhile, we've got aging white men running most of our major companies. So one of the workshops we offer is on intergenerational values in the workplace. A lot of white boomer men think that everybody has the same values that they do—and they don't."

Transforming a corporate business model is a delicate maneuver, says Brian Ferguson, chairman and CEO of Eastman Chemical Company, which employs 12,000 people and manufactures and markets chemicals, fibers, and plastics worldwide. Because he runs a company that has a workforce comprised of a great number of baby boomers, he is concerned about the aging demographic of his employees. He likens it to balancing on a burning platform.

"Can our older workers keep up in a faster moving world?" Ferguson asks. "The answer is mixed. It depends on their willingness to embrace change. There's a fine line between putting employees on a burning platform that makes them embrace change, and one that causes them to run for the door. If we scream and yell and tell them that if we don't embrace change this company will turn to dust, then they'll just jump off the platform and swim to another one."

Instead, Eastman executives try to craft their message so that professional employees feel like the company has an exciting story to tell—that they are participants in pioneering, cutting-edge technology. For technical and hourly workers, the message is that Eastman is a good company to work for and that by adapting to change they will continue to develop skills that will help them retain their value in the workforce and provide well for their families.

Unfortunately, American businesspeople can no longer dance around one yawing obstacle in a competitive marketplace—namely, that American students don't have the same skill sets in math and science as their forebears. "In the last few years, the U.S. has ranked in the bottom of the top 20 developed countries in terms of math and science students. We can't possibly continue to live in that position and expect we are going to maintain ownership of the technology sectors," states Bruce Lynskey, clinical professor of management at the Owen School. "There's no question that science and technology have an image problem in our domestic education system. To companies in those sectors—biotechnology, medical technology—the aging workforce is frightening, because they don't have replacements for those high knowledge employees."

Many companies are taking a novel approach to solving the problem, Lynskey says, by cherry-picking students from the most prestigious universities and offering them jobs no matter what their backgrounds. Executives reason that these students have shown a fire in their bellies just by surviving the vetting process of getting into those schools. If willing, even philosophy and English majors can learn on-the-job marketing, finance, or investment banking.

A comparable scenario is taking place in the executive search industry. New York-based J. H.McCann & Company, Inc., which recruits for investment banks, private equity firms, and hedge funds, has responded to the lack of talent at the junior level by raiding other types of businesses.

"We realize how tight the workforce is. So instead of stealing and paying up for talent from competitors, companies are telling us to go after smart, intelligent people and retool them," says John G. Owens, '04, director of McCann. "They're saying, let's take a lawyer and teach her how to be a trader on a trading floor, or take a CPA and train him to be a research analyst at an investment bank."

Although Owens has had a fair amount of success with this outside-the-box approach, he admits this is not a permanent solution to the problem of an under-trained and undermanned Generation X labor force. "Only so much of that can be done before every industry will begin running into brain drain," he says, adding that jobs in government, teaching, and health care could eventually suffer the most.

The demand for higher training in math and science actually extends to the blue-collar tier as well. According to Eastman's Ferguson, managing the kinds of technical skills needed today on the manufacturing line requires more complex skills than in the past—similar to what you would get in two years of college or an associate's degree from a community college. Gone are the days when a student could walk out of high school with a diploma and waltz right into a job at the local factory. This is a problem, he adds, only in their North American facilities, and one that hasn't arisen in Europe, Asia, or South America.

Headquartered in Kingsport, Tennessee, Eastman Chemical is now reaching into the region's high schools and technical and community colleges to help them design their curricula so that students will have the technical understanding and skills to be successful for the long term. Even after they are hired, Eastman offers hourly employees foundational training on site at their facilities. Whenever a process is added or changed in an assigned area, the employee receives updated, job-specific training.

"After we hatch them out of technical college, it still takes three or four years to get them 'manufacturing ready,'" says Ferguson.

Once they have the necessary manufacturing skills, Eastman looks for the best of these employees to place on a management career path, teaching them the required "soft skills," such as leadership, evaluation, and administration. Many stay in that path for three to five years before actually assuming a managerial role, and about half wash out in process, unable to develop the talents needed to supervise others. Those that make it, however, not only pass on their technical skills to others, but they become vital for preserving the corporation's history and culture.

While many boomers remain youthful and healthy and have no desire to retire, others simply discover they need an income stream beyond their 401Ks. Even so, they may want to slow down some. Top-level executives may still want to contribute, but have no desire to be in charge. To accommodate them, more and more companies are implementing creative solutions to keep these valuable workers in the pipeline. These options include phased retirement schemes, flexible work hours, and consulting opportunities that allow them to work on finite projects.

John Owens regularly deals with this type of client. He recently consulted with a gentleman who'd been the president of several major companies and was ready to retire away from his full-time job, but wasn't ready to retire permanently. "He'd like to serve on the boards of four or five corporations. That way he can still be active, can help companies make smart management decisions, and can advise them about priorities based on his experiences," Owens explains.

Tami Fassinger, head of the Owen School Executive MBA program, sees a new crop of alumni emerging, who are experts in an area, but are moving away from day-to-day oversight of a business in order to set themselves up as problem-solvers. "They'll accept a contract to come in and identify a problem, but will clearly define when their job will be terminated," she says.

She adds that as people move up in their careers, rather than stagnating, they can continue to grow professionally if given the education and skill mastery that allows them to evolve with the times. The Owen School offers non-degree executive development programs to facilitate that growth, whether it's in networking, leadership, management, or cross-functional training. In addition, Fassinger helps businesses customize their training and curricula to meet company-specific needs.

For Joe Rolwing, attending free-to-the-public courses through the Owen Entrepreneuring Center has rejuvenated his career, and allowed him to network with local business leaders. "I truly believe in the lifetime education," he says.

Yet, despite sporadic steps in the right direction, the platform is still burning and a crisis lurks unless U. S. businesses undergo some revolutionary changes. The demographic upheaval reverberates throughout every aspect of industry. Whittlinger is a member of the national Womens Presidents Organization, and one of the hottest topics among members, who typically range in age from 40s to 60s, is how to care for aging parents.

"We talk about baby boomers living longer, but older people are also living longer," Whittlinger says. "It's a perfect example of the dilemma. Here's a woman who loves her career and is at the top of her game professionally, but she has this other responsibility tugging at her time. If companies give her the opportunity to work three or four days a week, for instance, if they can accommodate this issue of parental care, then they can retain that employee's expertise."

Oftentimes organizations that were born out of ingenuity are now mired in rigid structure and deadly meetings. To keep the spark alive, some firms like 3M, Google, and Genetech, allow employees a dose of protected discretionary time for creative tinkering. This keeps their scientists investing in innovation beyond typical market-driven research.

Certain economists are proposing even more radical ideas. "We are still training people for the Industrial Age," says Lynskey. "Some of my colleagues think we need to throw out the notion of a hierarchy in the firm, because it stifles innovation. Instead it might be more efficient to structure a company as an aggregator that serves as a hub for a network of smaller companies—located all over the world, perhaps—performing specialized tasks that ultimately come back together into a finished product."

Included in that network, he adds, is a workforce comprised of all different status and types of workers—part-time, full-time, flex-time, young, middle-aged, senior citizens.

Some think that this business model would ensure a rotating supply of replacement employees as people move in and out of status levels, depending upon their needs at different points in their lives. In addition, such a configuration just might provide the incentive for workers to remain committed to their jobs, drawn to the thrill and fulfillment that comes from holding steady on a burning platform.