
American Firms Want to Keep Older Workers a Bit Longer - petethomas
https://www.bloomberg.com/news/articles/2016-12-16/american-firms-want-to-keep-older-workers-a-bit-longer
======
ryandrake
> With 10,000 baby boomers turning 65 each day, businesses are scrambling to
> find ways to slow an exodus of the most experienced employees and ensure
> that they pass along their knowledge before they leave.

Knowledge transfer should be baked into the day-to-day culture of work, not
something desperately scrambled for during someone's last week. Those few
companies with meaningful training and mentoring programs know this.

> The plant [...] has an apprentice program for millennials, but there’s a
> shortage of Generation X workers. “We’ve got a big gap in the middle, so we
> have to keep talented people in their 60s a little longer,”

Here we go again with the "shortage of workers". In one article it's tech
workers. Here it's GenX workers. A "shortage" of a good is pretty meaningless
if you don't mention the price you're offering to pay for that good. Unless
they're saying they literally can't find qualified GenX workers at any price--
That would be a real shortage. Otherwise, maybe you need to just offer a
little more money to find skilled mid-career workers nowadays.

With so many people under-employed or out of work, it borders on insulting to
claim there's a shortage of workers.

~~~
linkregister
I feel it's a cycle of mistrust. Companies don't want to spend as much time
training junior workers or apprentices because they often leave shortly after
achieving proficiency. But this lack of perceived loyalty comes from a
rational viewpoint. After the shift in business culture in the 80s, where
workers were laid off in bulk even if the company was in good financial
health, workers woke up to the new reality. (To be fair, the era of the
"company man" only encompasses half a century, so it's not necessarily a right
or natural phenomenon)

I remember in the 80s and early 90s it was common for a salaried worker to
stay at the same company for decades. Since the 2000s, it appears to be less
prevalent.

The solution would appear to be to make conditions good and wages competitive
for the newly-trained junior workers to improve retention. However, some
industries risk their competitiveness with labor costs above a certain level.
I wonder how much of the shortage is due to the intransigence of capital
versus true limits for competitive pay. I suspect the former for almost all
specialized positions experiencing shortfalls, such as pilots, machinists, CNC
operators, and millwrights. For unskilled labor I suspect that the wages
cannot climb much higher without harming profits or risking competition from
overseas.

~~~
WalterBright
I read in the newspaper that Boeing has a skills gap with their machinists.
The skilled older ones are retiring, and the younger ones aren't experienced
enough. There are few in the middle.

What happened? When they had layoffs, the machinist union rules specified the
ones with the least number of years of service got laid off first. This left
Boeing with a very unbalanced workforce.

~~~
IndianAstronaut
Seems like unions benefit just the insiders and seniors. One reason why I am
skeptical when people say unions built the middle class. Employer competition
probably does more for that than unions.

~~~
bsder
If a company has a bimodal age distribution, the question to be asking is "Why
didn't they think about hiring someone occasionally over the last 15-20
years?" Of course, the answer is that no corporate manager wanted to miss his
number by hiring another person.

So, the managers kicked the problem down the road and hoped that someone else
would take the hit.

> Seems like unions benefit just the insiders and seniors.

Everybody gets old, you know.

Unions implemented this policy because companies were wiping out older workers
because they were more expensive in terms of wage and healthcare.

> Employer competition probably does more for that than unions.

Agreed. But the same anti-union people are also against anti-monopoly
regulations.

~~~
Godel_unicode
> Unions implemented this policy because companies were wiping out older
> workers because they were more expensive in terms of wage and healthcare.

This is essentially what GP is saying. Unions kept the expensive older worker
at the expense of firing the younger workers. If the workers they keep are
more expensive, then they have to fire proportionally more younger workers to
make it up.

------
dxg732f
Most of the really experienced people at companies I have worked for where
surprised when I asked about what they did and why. They somehow assumed
someone else was supposed to be training me. They were the only ones who knew
answers to particular questions I had. They were shocked and sometimes didn't
believe me that I asked everyone but them first. I don't blame these
experienced workers for not sharing their knowledge, someone should have told
them, though, that they are expected to do it, there are no systems in place
at most places. Most companies seem to believe that knowledge transfer just
happens magically,or should.

~~~
user5994461
> Most companies seem to believe that knowledge transfer just happens
> magically,or should.

Put more experienced with less experienced workers working together and it
does happen magically.

~~~
dxg732f
I think in my case it did, I did learn from the experienced workers but that
was apparently not the norm there. I hope you are right that that is what
happens most places.

------
JoeDaDude
I've often thought that after a certain age, instead of getting some percent
increase in salary, it would be preferable instead to work some percentage
fewer days or hours. Seems like the idea is finally catching on. I hope I get
to enjoy it when the time comes.

~~~
mooreds
I have always said that when I get to "X" income, I'd rather have more time
than more money. Of course "X" changes over time, but I have definitely hit it
before.

This is what consulting/contracting lets you determine, but I hear you, it'd
be nice to have the option coupled with the safety and job opportunities of
employment.

------
jimwalsh
There's a gap there because the firms didn't want to pay the GenX generation
after they got trained. They hopped on to the next company and progressed
their careers.

Take better care of your employees, pay them their market value, factor in
some work-life-balance, and they will stay.

------
madengr
"A shortage of gen-x workers" is exactly the case at my facility. I'm 45,
which is the valley in the bimodal age distribution. People are either in
their 60's or 20's, and those two generations do not get along.

~~~
driverdan
Why is there a shortage? Are you underpaying people?

~~~
madengr
Not me personally; I'm an EE, not a manager. But yes, they underpay. I'm only
making market salary because I threatened to quit last spring.

~~~
mooreds
Ah, labor does respond to the law of supply and demand :).

------
oxide
Recently I've heard two different stories about this exact problem. Two
specialized trades, two experts of their crafts about to retire, and two
companies unsure how they'll replace them.

I wish I remembered more details about the experts themselves, I believe one
was a specialized glass worker.

~~~
Inconel
One of the people you might be thinking of is the glass blower who is retiring
from Caltech.

[http://www.latimes.com/local/education/la-me-caltech-
glassbl...](http://www.latimes.com/local/education/la-me-caltech-
glassblower-20160613-snap-story.html)

------
jwatte
If salaries go up, shortages go down (both on silly and demand side)

~~~
randomdata
Shortage is defined as a situation where price cannot rise, such as the
government setting a price ceiling. If price can rise then a shortage is
impossible.

~~~
cauterized
So if right at this moment the world had only enough doctors to care for half
the population, regardless of the price, that wouldn't be a shortage of
doctors?

If there were a severe drought and only enough food to keep half of us alive,
but prices weren't capped... That wouldn't be a food shortage?

If there are only 10,000 people in a field who are under the age of 70 but
have at least 20 years of experience, and the industry needs 50,000 of them to
function efficiently - that's not a shortage of experienced skilled workers?

Not everything is a commodity. Not every commodity experiences a drop in
demand as the price rises. Some things are needs that people continue to have
demand for even if they can't afford them due to shortages. Even commodities
have limits to their production. And some things can't be produced quickly
enough to address a short or medium term shortage.

Markets aren't magic. They have inefficiencies and externalities and logic
limits. Econ 101 deals only in simplifications and spherical cows. And people
with specific skill sets aren't spherical cows.

~~~
randomdata
_> So if right at this moment the world had only enough doctors to care for
half the population, regardless of the price, that wouldn't be a shortage of
doctors?_

Doctors may not be the best example. Where I live, at least, the government
really does set a price ceiling for doctors, so a shortage is very much
possible. Ignoring that, simply not being able to afford a doctor does not
mean there is a shortage of them. That means you cannot afford a doctor. Which
is a problem in its own right, but not a problem defined by shortage. Not all
problems are shortage problems.

 _> If there are only 10,000 people in a field who are under the age of 70 but
have at least 20 years of experience, and the industry needs 50,000 of them to
function efficiently - that's not a shortage of experienced skilled workers?_

No, because as price rises, that 50,000 number will decline. There is only so
much money willing to be spent. At some price point, businesses will only be
able to afford 10,000 people and the demand will be met exactly by the number
of people available to work. Or if the job really requires 50,000 people
absolutely, they will decide it no longer needs to be done, leaving the the
need at 0 people.

 _> Not every commodity experiences a drop in demand as the price rises._

How can that be? Not everyone has the same resources available. Like the
businesses above, as price rises, some can no longer afford the good or
service. That takes them out of the market. Demand does not simply mean what
you want to have. Price is always a component. Like that great earlier comment
here about Porches, there isn't shortage of Porches because every poor man who
admires the car can't afford one. They are simply not in the market for one in
the first place, no matter how much they dream about owning one.

 _> Markets aren't magic._

Nobody said they were. The scenarios you point out, where price is able to
rise, are something, but not shortages.

~~~
cauterized
That seems to me like a strange, limited, and impractical definition of a
shortage.

When the supply of something is insufficient to support effective operation
(or to support existing life), that's a shortage.

Yes, perhaps prices will rise until no more people can afford it than the
supply will support. But perhaps that supply isn't enough to keep the industry
from collapsing or to keep the population from collapsing, etc.

Regardless of whether the price rises to keep the resource out of the hands of
everyone who needs it, the insufficient supply for _effective function_ is
still damaging - to a population, an industry, an economy. I would most
definitely consider that a shortage.

~~~
randomdata
_> That seems to me like a strange, limited, and impractical definition of a
shortage._

Well, that's its definition, for better or worse. I didn't write the economics
dictionary. I only can repeat it.

Is there reason to overload this particular word? While the implications of
the scenarios you describe are clear, I'm not sure why it has to be "shortage"
that represents it. Why not another word or term that encompasses those cases
– unaffordable, perhaps – while leaving shortage to mean what it means?

~~~
cauterized
Why not let "shortage" have a vernacular meaning too? One that it already had
before the field of economics adopted it for a more specific purpose?

------
Clubber
I wonder how much of this has to do with the dot bomb in 2001. It washed a lot
of my generation (GenX) out our technology.

