Succession Planning

Preparing for the “Brain Drain”

Succession Planning to be Critical in Preparing for the Transition of Baby Boomers to Retirement

What is the Brain Drain?

Perhaps you have started to notice the term “brain drain” more and more in the popular media. This term is being used to describe the anticipated loss of skilled talent from our workforce as members of the baby boom generation begin to retire. In fact, recent reports indicate that as many as 7,000 boomers are now retiring every day.

The “baby boom” generation includes those born between the years of 1946 and 1964. The oldest in this group are now in their 60’s and the youngest are in their 40’s. Since this group represents the largest portion of our workforce, it is easy to see that large numbers will retire over the next 10-15 years. The impact of this phenomenon is expected to be at its peak within the next 5-7 years so business succession planning is essential.

How to Prepare for the Brain Drain

Because of the size of the baby boomers as a whole, companies need to develop a comprehensive strategy to prepare for the brain drain.  One very easy way to prepare for the brain drain is to increase entry-level hiring.  If companies start now, they will have the time to properly to hire and develop younger workers with the skills required to replace those possessed by retirees.

While some companies may try to hire experienced talent from Generation X (people born from 1965 to 1978) to compensate, it is important to know that the baby boomers as a group is about twice as large as Gen X.  What this means is that there will be a shortage of mid-level workers to fill projected available openings.  As a result, competition will be fierce for these workers and salaries within this group can be expected to increase substantially.

Many firms are coming to the conclusion that a better strategy is to augment targeted hiring of experienced Gen X’ers with a comprehensive plan to hire, train, and groom entry-level talent.

The Importance of Hiring at the Entry-Level

At GradStaff, we have always been proponents of hiring at the entry-level. We often refer to it as “building your bench.” Having a talented pool of hard-working, motivated employees at the entry-level is crucial to any company’s ability to grow and weather change. The expected “brain drain” phenomenon is all the more reason to add talent at this level.

Proactive companies are recognizing the inevitable now and are making increased entry-level hiring a foundation of their long-term strategies. GradStaff is playing a key role in helping many companies achieve their succession planning goals. We are prepared to help you.

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