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Employing Older Workers

The pace of retirements picked up during the pandemic. Can employers entice these workers to come back?

As a health care provider operating in a tight labor market, Allegheny Health Network in Pittsburgh needs to not only retain its current workers but also find new pools of potential employees. So why not target people who have retired or taken a break late in their careers?

"We knew there were a lot of nurses who kept their licenses current even though they were not practicing," says Claire Zangerle, the organization's chief nurse executive. She heard again and again that these nurses, and many other health care workers, were reluctant to return to work because of the lack of flexibility in scheduling and the long hours required per shift.

To address these concerns, Allegheny Health developed a program, which kicked off in 2017, to provide more flexibility for these professionals. "Flexible scheduling is the foundation of the program," Zangerle says. "If they don't want to work eight- or 12-hour shifts, we needed to let them work fewer hours per shift, but at least a four-hour block of time," she says. "There is never a time when we don't need an extra set of hands."

The program, which is also available to current employees who want a change of status or schedule, has allowed the organization to retain some older nurses who are concerned about the physical toll full-time practice takes on them. "They may want to retire because they don't know how much longer they can do the work," Zangerle says.

The initiative has become even more relevant lately. As the pandemic took hold in the U.S., the number of workers retiring increased. At the same time, the number of retired workers returning to the workforce declined. But this largely untapped pool of workers may be willing to return to work under the right circumstances.

The Federal Reserve Bank of Kansas City estimates that 2.8 million U.S. workers under age 75 have retired since February 2020. This represents a significant pool of potential employees for Allegheny Health and the countless employers across the country that are desperate to hire workers.

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Paving the Way

In a 24/7/365 work environment, flexible scheduling at Allegheny Health requires flexibility by management as well. People managers need the permission and freedom to be creative, along with the training and technology necessary to support these efforts.

In addition, nurses returning after time away need refreshers to ensure their clinical skills are up-to-date. This includes shadowing a nurse in a practice area where they want to work "to get their legs back," Zangerle says. "It's all about re-entry."

This type of retraining is often essential for older workers returning to the workforce after any length of time. The longer people are away from work, the harder it can be for them to return. Their skills can become outdated as technology and work processes change and the speed of everyday work increases. People who left the workforce when the pandemic began in March 2020 and now want to return to work may face significant challenges in doing so.

General Motors' Take Two program focuses on facilitating the return process for workers who have been out of the workforce for at least two years. While the program does not target any specific age demographic, it builds an on-ramp back to work for older workers by providing 12 weeks of onboarding, mentoring and orientation.

"This is designed to help them hit the ground running," says Tamberlin Golden, the company's executive director of workforce strategy. "When they come back to the workforce, they don't have to figure it out on their own."

The program provides training in certain areas, including technology, to help participants expand and refresh their professional skills. Participants have worked in a number of areas in the company, including finance, software programming and software data analytics.

Each worker in the program meets weekly with a mentor to discuss progress and challenges on the job. "This is the time to assess opportunities for development and ensure access to self-paced learning to enhance their professional skills based on the recommendations set for them," Golden says.

Employers that are looking to build their own programs to help older workers transition back to the workplace can start with a pilot program. Make changes over time in accordance with participant and manager feedback and the performance of program alumni based on metrics such as retention levels. "Start small and nurture the process," Golden recommends.                    

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Throughout the COVID-19 pandemic, many older workers left the workforce to retire early, take a break because of caregiving responsibilities or attend to health concerns. The pace of retirements was especially brisk early in the pandemic. As a result, employers that want to recruit from this pool of potential workers are likely to find it is larger than expected.

The percentage of the U.S. population that is retired increased 1.3 percentage points between February 2020 and June 2021—most of which occurred during the height of the first wave of the pandemic and well before the first vaccines became available. By contrast, from 2010 to 2020, the number of retired workers increased only 0.3 percentage points, according to an analysis conducted by the Federal Reserve Bank of Kansas City.

"If the retirement share had risen at its 2010-2020 pace, the number of retirees would have increased by 1.5 million during the pandemic. Instead, the number of retirees increased by 3.6 million," according to the analysis. —J.S.

Don't Forget Retention

It's also important to encourage older workers to remain on the job. "Employers are starting to see years of knowledge walk out the door," says Candice Pokk, an organizational effectiveness consultant with benefits and human resources consulting firm Segal. In some cases, employers may not recognize what knowledge they will be missing until they need it. "This could be someone working in the facilities department who knows how to handle hazardous materials or knows how to work a specific, but very important, valve on a piece of equipment," she says.

To avoid a knowledge drain, an organization's leaders need to keep tabs on retirement risks in the workforce and where those departures would leave the organization most vulnerable. With that information, employers can develop interventions to either capture older workers' knowledge before they retire or negotiate arrangements to keep them working longer.

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"The most crucial metric is the percentage of employees retiring over the next five years," Pokk says. "To retain older workers, employees need to have open and honest conversations about the employee's plans, how to handle knowledge transfer, and what the employee would need and want in order to stay on the job longer."

However, any delay in retirement should be mutually beneficial, with goals attached. "Companies don't want to retain just to do so," Pokk says. "Be thoughtful about why you need to keep employees and what they are going to do if they stay."

While many people focus on financial reasons for continuing to work, employers can also emphasize the sense of connection and affiliation that comes with having a job. Older workers drawn to these links may elect to stay on longer in a different role.

For example, such a role could revolve around coaching and mentoring younger employees who will step into the older worker's job when the time comes. A departing employee in this role also could dedicate a specific period of time to focus on knowledge capture before retiring. For example, the employee could be shadowed by other workers or make videos to create a knowledge archive of the work and what others need to know.

Exit interviews are a good time to discuss whether the employee is willing to stay with the organization in some other capacity, such as serving in a consulting role or doing project work. In this case, the employee could choose when and how the work is done.

At Allegheny Health, the organization strives to find the right approach for each individual. That might include the option of a hybrid position with a mix of work in the clinical setting and work that can be done on a computer from home. "The key is to find ways to use their knowledge capital," Zangerle says.

Part-time work or phased retirement can be important ways to keep people in positions that are hard to fill. For example, truck drivers, skilled tradespeople, and facilities and maintenance personnel are increasingly difficult to find, so employers may be able to persuade them to stay on by offering reduced hours, job sharing or increased wellness benefits to help them manage the physical demands of these roles.

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Making It Work

From a business standpoint, employers should be prepared to measure the impact of these re-entry or retention programs. "Getting people back requires a lot of effort and energy, and employers don't always see a good return on that investment of time," Zangerle says.

To gauge the effectiveness of these initiatives, employers can look for improvements in retention levels, recruiting costs, time to fill vacant positions and staff workload, as well as quality scores and employee engagement levels.

Importantly, employers should find ways to make older workers feel welcome and supported. For example, "bringing a group of older workers on board at the same time can create a cohort effect as these workers bond during the transition back to work," says Carol Fishman Cohen, CEO of iRelaunch, a Miami-based consulting firm specializing in career re-entry. "These people can be each other's sounding boards and cheerleaders."

Joanne Sammer is a New Jersey-based business and financial writer.

Explore Further

SHRM provide information and resources to help business leaders find and attract talent to meet their organizations' workforce needs.

SHRM Toolkit: Employing Older Workers
Few organizations have taken steps to prepare adequately for issues associated with older workers remaining on the job, leaving the workforce or seeking new employment opportunities.

Attracting and Retaining Older Workers to Your Workplace
Although older workers today are better educated, live longer and stay in the workplace longer than those of previous generations, discrimination and outdated assumptions about them persist. Breaking down age bias can help organizations during the labor shortage.

Recruiting Retirees: Opportunities, Barriers and Best Practices
Companies are getting increasingly desperate, but desperation can spark new ways of thinking about how to fill vacancies. Often overlooked are retirees that represent a largely untapped source of promising talent to help stem the impacts of the Great Resignation.

Welcoming Back Retired Employees
In a tight labor market, many companies are leaving no stone unturned. Some are looking to retired employees to fill open positions. While hiring retirees can present challenges, employers say there are numerous benefits.

SHRM Resource Hub Page: Overcoming Workplace Bias
All workers have the right to equal opportunity in employment, free from discrimination, prejudice and bias. Encompassing more than legal compliance, HR's role in equal opportunity at work has the capacity to change lives and society. These resources will help you navigate this crucial work.

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