Ahead of the Retirement Wave

Willis Towers Watson published a white paper, “Working Late: Managing the wave of U.S. retirements,” which discusses employers’ need to better understand older employees’ plans for when and how to retire.

“Older workers can be some of employers’ most important employees, valued for their knowledge of industries, companies and customers, and their contributions to organizations’ continuity and future success,” the paper says. “[But] demographics of the U.S. working population illustrate that the pace of their departures is increasing, as 83% of employers report a significant number of employees at or approaching traditional retirement age.”

According to the research firm, just over 80% of organizations acknowledge the importance of their older workers and of managing the retirement process. Yet, only about half believe they understand the process well, and just one-quarter say they have found an effective approach.

“There are also important disparities in perception—between management’s view of when pending retirements will occur and the plans of the workers,” the white paper says. “Employers are concerned both about increasing retirements and the resulting loss of seasoned employees’ skill and experience, as well as rising numbers of delayed departures leading to higher salary and benefit costs.”

For that reason, Willis Towers Watson wrote, firms are taking a new look at retirement patterns, developing new strategies for balancing the supply and demand of older workers’ talent, and integrating their workplace programs to enhance physical, social and financial well-being.

When asked why managing the orderly retirement of employees is important, 83% of the employers surveyed ranked “orderly transfer of knowledge of the organization” as their top concern, while 60% pointed to “concerns over workforce productivity.”