From the Los Angeles Times

LABOR

Companies try to retain older workers

By Jonathan Peterson
Los Angeles Times Staff Writer

September 3, 2007

Every time John Remore steps up to his workstation to form a piece of sheet metal, he brings an intangible asset to the job: 42 years of experience, dating to lessons from his father.

Remore, 60, doesn't brag, but that won't stop his boss. "He's invaluable. He is priceless," said Kellie Johnson, president of Torrance-based Ace Clearwater Enterprises, which makes parts for big aerospace companies.

She worries that when Remore and others of his generation retire, she will find it almost impossible to replace their skills. The average age of her workforce is 48.

"We're in the fight of our lives for skilled talent," said Johnson, whose grandfather launched the business in the 1940s welding bicycles, coffeepots and tools. "Looking forward, that will be the No. 1 issue that affects our ability to compete in the global marketplace, without a doubt."

In a society that exalts youth, older workers may sometimes feel like outcasts of the economy -- prodded into early retirement by corporate buyouts, overlooked for training and promotions, typecast by younger managers as past their prime.

Indeed, one 2005 study found that job applicants under age 50 were 42% more likely to be called for interviews than those over 50.

Yet there may be early glimmers of change. The oldest baby boomers are entering their 60s, raising the prospect of a vast wave of retirements. The post-World War II baby boom, moreover, was followed by a smaller "baby bust" generation.

As a result, some employers are worried that they will lose too many people -- and are pioneering policies to make the workplace more friendly to older employees.

"I think we're beginning to see a much broader range of options and opportunities for mature workers," said Diane Piktialis, a specialist in older-worker issues with the Conference Board, a business research organization in New York. "This is an area where there's just enormous room for creativity in terms of how companies can adapt."

Concerns are particularly acute in the areas of manufacturing, healthcare and government.

In the 3-million-member federal workforce, for example, 6 out of 10 employees could retire over the next decade, prompting a recent congressional proposal to lure retirees back to work with new financial incentives.

In other cases, certain companies are showing a willingness to make work schedules more flexible, an approach much desired by older employees.

At CVS pharmacies, more than 1,000 employees take part in a "snowbird" program that allows them to migrate between stores in different parts of the country as the seasons change.

Pharmacist Bill Duclos, 80, shifts his part-time job in Massachusetts every October to a CVS store in Florida. The arrangement lets him spend part of the year in the Northeast near his children, grandchildren and a great-grandchild, and part of the year enjoying golf, shuffleboard and card games in Florida.

It also happens that his seasonal pattern tracks business realities, because the Florida stores are much busier in the winter, when snowbirds such as Duclos show up.

"It works out for people like me -- and it works out for CVS, I guess," he said. "We're very happy with the way things are going."

Managers of the Rhode Island-based chain of drugstores say there's another benefit: The older workers sometimes are friendlier to customers and have a better work ethic than their younger counterparts.

"It gives us a competitive advantage," said Steve Wing, director of government affairs for CVS, which began the snowbird effort as part of a broader initiative to hang on to older employees.

"If we don't continue to recruit and train and retain older people, we won't have a business. We rely on them. We need them."

The need to be fully staffed isn't the only reason employers are seeking to retain older workers. Some retail executives believe these employees are more tuned in to the needs of aging customers.

In the book business, for example, more than half of consumers are older than 45, a finding that prompted Borders Group Inc. to intensify efforts to employ middle-age workers. Today, 16% of its 32,000 employees are over 50 -- up from 6% several years ago.

"It really makes sense -- from an employment perspective -- for us to target individuals who are over 50, because so much of our consumer population is over 50," said Suzann Trevisan, director of organizational development for Borders Group in Ann Arbor, Mich.

Although such views are not in sync with much of popular culture, they may become more common as the population gets older.

About one-third of employers have adopted strategies to a moderate or great extent designed to help older workers hang on beyond the traditional retirement age, according to a survey of 578 employers by researchers at Boston College.

And older workers may increasingly be a fact of business life. From now to 2014, the population of workers 55 and older will increase at four times the rate of overall labor force growth.

During this same period, younger age groups will grow much more slowly. The 78.2 million boomers, born from 1946 to 1964, were followed by a baby bust generation that is about 16% smaller in size.

Starting next year, the oldest baby boomers will turn 62, qualifying for Social Security early retirement benefits.

Some have predicted that mass retirements by baby boomers could trigger a disruptive shortage of workers in the coming years, depriving the U.S. economy of millions of needed employees and an immeasurable wealth of skills.

But some economists say the concerns are overblown. Employers can move jobs overseas, they point out. Companies can invest in labor-saving technologies. They can restructure jobs. And, economists argue, they can pay more money to attract the workers they require.

"I don't think there's any possibility of there being a major shortage," said Richard B. Freeman, a labor economist at Harvard University.

Still, some companies and industries are bracing for an exodus of boomers. Those with the oldest workers, including government, manufacturing, utilities and transportation -- as well as those already contending with skill shortages, such as the healthcare industry -- may face pressure to overhaul benefits and other policies in a bid to recruit and retain older workers, experts believe.

To help meet the need for nurses, Massachusetts General Hospital now provides lengthier training for older nurses who wish to return to their occupation but are no longer current with the latest technology.

"It's a pretty big thing to be able to say, 'We'll be patient and we're able to work with you a little bit longer,' " said Patricia Sheehan, a human resources manager.

The issue is not limited to the private sector. Last month, Sen. Susan Collins (R-Maine) introduced a bill that would enable federal agencies to rehire retired workers on a limited, part-time basis without the usual penalty -- a pay cut tied to their retirement benefits.

"This legislation will prove vital as the federal government loses many of its skilled, experienced, senior employees," Collins said.

Some believe that employers are starting to get the message. Since 2001, AARP has put together a list of "best employers" for workers older than 50, based on such matters as recruitment practices, training and education opportunities, benefits and support of work options, including flexible scheduling and job sharing.

Companies in the healthcare and education fields have dominated the list, but a smattering of firms have been cited in manufacturing, retail and finance.

"The number of candidates . . . is not only increasing but diversifying by industry," said Deborah R. Russell, AARP's director of workforce issues.

One concern is that retiring boomers will take their knowledge out the door with them, creating a shortage of valuable know-how.

At Ace Clearwater, senior workers try to pass their craftsmanship to the younger generation.

"We try to help them every chance we get," said Remore, a longtime employee whose machine is known as a drop hammer. "We'll try to give them a job that it doesn't take much to know. As they progress, the jobs get harder."

The aging of the workforce is not the only reason the company struggles to keep an adequate pool of skilled workers. The scarcity also owes to manufacturing's lack of allure for the young, and more stringent skill demands than in the past.

To recruit and retain workers, the company offers signing bonuses and flexible scheduling, Johnson said. At the same time, she feels strong pressure to keep costs in line and cannot always match salary offers from other firms.

Last year, for example, Northrop Grumman Corp. offered a highly skilled machinist $8 an hour extra to jump ship. "We can't compete with that," Johnson said. The company, which employs 180, has needs for welders, engineers and machinists.

It is unclear just how far the enthusiasm for older workers can spread. Yet some insist the possibilities are vast.

Employment firm RetirementJobs.com. reports leading older workers to jobs with a broad range of financial, manufacturing and retail employers, including Metropolitan Life Insurance Co., New York Life Insurance Co., Principal Financial Group, Pitney Bowes Inc., Staples Inc., H&R Block Inc. and Safeway Inc.

"We're watching a very, very pleasant change occur, where industries that have traditionally relied on bright-eyed and bushy-tailed young people are now relying on older workers to do these jobs," said Bob Skladany, vice president of the Wellesley, Mass., firm and former head of human resources for L.L. Bean Inc. "I think we're seeing the first wave of a fairly substantial shift."

jonathan.peterson

@latimes.com