“It’s been mitigated a little because of the economy, but I think it’s a huge problem for us,” Redlo said.
Age and experience mean better quality and patient satisfaction, he said. Older workers are also highly trained and can be expensive to replace.
Call it the bathtub effect. Among the engineers at Lockheed Martin’s missiles and fire-control division, “most were hired into the industry in the ’60s and ’70s,” said Gary McPherson, vice president of human resources for the Lockheed unit. Then new hiring dropped off, which means fewer workers between age 35 and 45. Graph it out on a piece of paper and you see “a bathtub in the middle,” between the original generation and a wave of recent college graduates, he said. Forty to 60 percent of McPherson’s division will reach retirement age at the same time.
Like many companies, Lockheed focuses on the 15 to 20 percent of older workers in what McPherson calls “very critical positions,” such as lead missile propulsion engineers. Although the company has developed mentoring programs that pair veterans with younger workers to pass along experience, the chief risk — as at Dow — is that there simply are not enough qualified replacements.
In Texas, home to Dow and the Lockheed unit, public schools have de-emphasized vocational education, said John Ray, dean of information and community resources at Brazosport College.
“Today, you don’t have students with experience in working with their hands,” Ray said.
Brazosport, a community college near Freeport, has joined with petrochemical companies to train students while hosting courses for new hires at companies such as Dow and BASF.
While Dow has recognized the long-term employment trends the industry confronts — “We’re having to look for alternative supplies,” said Troy Bearden, Dow’s services leader for its Houston area operations — the consequences are sobering.
“If you would ever get into a situation when you didn’t have the trained and skilled folks available to operate the units,” said Bruce Raiff, who oversees “knowledge transfer” programs for Dow’s Texas operations, “you’d have to shut the units down.”
Employers in other industries, coping with the same employment profile, say they face their own challenges. Disability costs can rise with older workers. And workplace adaptations to accommodate decreased mobility may be needed. On the flip side, older workers who do not retire could slow the career ladder for younger workers, while newer technology that is second nature to millennials can put off older workers. Yet older workers are also more highly engaged and absent less often than young workers, according to the Sloan Center.