Family Business
Issue No. 28 - April/May 2006
The Boomer brain drain
The Australian Financial Review reported in November 2005 that 2.7 million people aged between 50 and 64 — the Baby Boomers — are set to retire in the near future.
That means, for instance, that 20% of Australia Post’s workforce will retire in the next five years and that is typical of many large firms.
Phil notes that by 2016 more than 80% of Australia’s workforce will be 45 years of age or older. Of the huge chunk of workforce planning to retire soon, the proportion is much higher in rural Australia.
Replacing those people will be hard enough, but there’s more to the problem than counting heads. It’s what’s in the heads that really counts.
“The capture and transfer of knowledge is going to be critical into the future,” says business adviser Phil Dewing, of the Family Business Centre, who makes a point of anticipating succession hurdles.
Phil says it’s important to capture the knowledge of “grey hairs” early, to transfuse it into successors within the organisation. How important is this? Imagine your sales database — and the network of relationships it represents — standing up and walking out the door.
Modern, more flexible work practices can keep older workers involved in a business longer through part time arrangements, but it’s better to replace departing workers, ideally by growing them from within.
In this the family business enjoys a loyalty premium, but it would be foolish to expect your children to be immune to trends among their peers.
At the moment, Generation Y (born 1982— 2000) makes up 26% of the Australian workforce. Generation X (1965—1981) makes up 25% and Baby Boomers (1946—1964) constitute 25%. The remaining “Builders” (1926—1945) add 15% while there are still Seniors (before 1925) on the job: 3%.
Builders are fast retiring, the Boomers are next in the queue, and both often look to children in Gen X and Gen Y members to inherit. ...
