I just came across an interesting article by Jeffrey Joerres on the editorial page of The Wall Street Journal Europe (April 9, 2009) entitled Aging Your Work Force. The article is about the challenge of an aging workforce in Europe and says that “a loss of productivity and intellectual capital as baby boomers leave the work force could devastate some businesses. Europe’s work force will begin shrinking in the coming years and is expected to become 15% smaller within five decades, according to the OECD. The countries with the biggest threat are those with the oldest populations, particularly Germany and Italy.”
This has long been recognized as a problem in North America as well. In the US a Conference Board study Managing the Mature Workforce predicts that by 2010, the number of workers aged 35 to 44 will decline by 19%. This is a world-wide phenomenon. The number of workers aged 35 to 44 was forecasted to decline by 27% in Germany, 19% in the U.K., 9% in Italy, 10% in Japan, and by 8% in China. A study from the American Public Power Association (APPA) Work Force Planning for the Public Power Utilities: Ensuring Resources to Meet Projected Needs reports that the loss of critical knowledge and the inability to find replacements with utility-specific skills are the two biggest challenges facing the industry. In the utility industry the average age of utility workers is close to 50 and by 2010, as many as 60 percent of today’s experienced utility workers will retire. A Booz Allen Hamilton study has predicted a 20% decline in productivity in the US power industry.
Many utility companies are facing a triple challlenge. Retiring workers are leaving faster than younger replacements can be hired and trained. Secondly the workers who are retiring have many years experience and are being replaced with younger, inexperienced workers. Thirdly utilities are having a difficult time retaining younger workers.
The economic downturn could exacerbate the problem of retiring experienced workers. Laying off or accelerating the retirement of older, experienced workers may be seen as a way to reduce costs in the short term, but could have dire consequences in the longer term. One of the key points Jeffrey Joerres makes is "one of the biggest mistakes companies make is to alienate employees aged 50 and older by assuming they are no longer interested in training and career development."
To help younger workers get up-to-speed quicker, utilities are investing in smarter rule-based software tools that not only prevent mistakes (underengineering), but also reduce costs by helping designers and planners to avoid overengineering.
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