You'd think the words "brain drain" would strike fear into the hearts of IT managers. As the calendar has turned to 2008 -- and the oldest baby boomers are now eligible to receive Social Security -- it has become clear that growth in the number of older workers will soon surpass the growth in the number of those just starting out. In eight years' time, according to the U.S. Bureau of Labor Statistics, one in four workers will be 55 or older. And particularly in IT, there's not a big influx of new talent. According to the Computing Research Association, computer science enrollments dropped 14% each year between 2004 and 2006.
Although IT organizations certainly understand these workforce trends, many are not taking significant measures to mitigate the risks that the loss of intellectual capital seems to portend. Even outside of IT, many companies seem unconcerned by boomer retirements. In a 2006 survey of 488 companies conducted by Buck Consultants LLC, only 42% of the respondents said that the aging workforce was a significant issue, and 29% said it had little or no significance.
And in a nationwide study of 550 human resources managers conducted by Monster.com last summer (view PDF), only 12% of the respondents said they consider knowledge retention a high priority within their companies, even though one-third said they expect at least 20% of their workforce to retire in the next decade.
The inescapable conclusion seems to be that many businesses are perfectly content to see their boomers walk out the door. And because so few organizations have taken the retirement issue seriously, companies that want to transfer knowledge from older to younger workers have few models to follow. As a result, those that are attempting to get ahead of the retirement wave are finding themselves pretty much on their own.
How big a problem?
One reason the impending boomer exodus seems to have so little resonance in IT is that, relatively speaking, there isn't a very large population of older IT workers, says Peter Cappelli, author of the upcoming book Talent on Demand: Managing Talent in the Age of Uncertainty. "It's mostly a young person's game," he says.
An Aging Workforce
| The percentage of U.S. workers 55 and older is rising ... | |
|---|---|
| 2006 | 16.8% |
| 2016 | 22.7% |
| ... while likely successors will be on the wane in the next eight years. | |
|---|---|
| Age 55-64 | +30.3%* |
| Age 35-44 | -5.5%* |
| Age 16-24 | -1.1%* |
| Few IT managers have taken steps to retain professionals nearing retirement age. | |
|---|---|
| Flex schedules | 19% |
| Part-time options | 12% |
| Contracting retired employees | 9% |
| Increased compensation | 9% |
| Bonuses for staying on | 8% |
| Delayed retirement plans | 4% |
| No steps taken | 60% |
Note: Multiple responses allowed.
Source: Computerworld survey of 233 IT professionals, May-June 2007Statistics from the U.S. Bureau of Labor Statistics bear this out. In 2007, only 10% of the U.S. IT workforce was 55 years or older, compared with 17.6% across all occupations. Moreover, considering that the midpoint age of boomers is currently about 51, retirement is more than 10 years off for many.
There are other reasons for the lack of concern. One is that although the costs of losing key IT personnel to retirement can be high, they are also hidden, gradual and indefinite, says Dave DeLong, president of research firm David DeLong & Associates and author of Lost Knowledge: Confronting the Threat of an Aging Workforce (Oxford University Press, 2004).
"Nobody will go to the executive board and say, 'Last year we could manage this process more effectively, but Joe left, so now we can't,' " DeLong explains. "It's a loss of face, so they'd explain it in other terms."