A study conducted in 2011 indicated that 76 million employees belonging to the baby-boomer generation will be retiring in the near future.
This means that the job market will experience a mass exit of skilled employees, changing the dynamics of the job market. Baby boomer retirement will bring significant changes around the company. So, be prepared to see a massive change in your work environment.
What to do before baby boomer retire?
Before the boomers retire, you need to transfer valuable skills and knowledge to other employees. Introduce cross-training and mentorship program, to make sure that your organization is ready to sustain this generation-shift.
A survey indicated that 92 percent of companies are taking necessary steps to keep their employees longer. If you feel that a certain employee is extremely valuable for your company, extend their stay by offering:
- Flexible working hours
- Offering part-time job vacancies to employees who have reached retirement age
- Making your workplace friendly for people with disability or health condition
- Baby boomers possess entrepreneurial skills; utilize it by offering them shares or partnership in the business.
What will happen when they retire?
Baby boomers are the generation that belong to the year 1946 and 1964. A specific age group leaving the job market will cause a brain drain.
Retirement means more jobs will be created which means companies will have to bear the cost of recruitment and training. Moreover, the new candidate pool will consist of generation Z and millennial, which means new policies and employee benefits program need to be created.
Special job openings will also need a hike, as companies will need immediate replacement in special posts, especially IT firms. Companies will offer a higher pay scale for these special roles that require experience and special education. Needless to say, companies will be required to revise their existing policies and benefit plan to cater to a multi-generation market.
Changes that will come to your employment benefit program
Medicare
Once an employee turns 60, medical benefits are used and abused at a higher rate. HSA’s policies can be confusing. Make sure your employees know what they are dealing with. The major concern of retiring employees is the health insurance penalties.
Employees enrolled in employer-sponsored health programs are generally not penalized for late enrollment in Medicare. However, some employees tend to enroll in Medicare part A, when they are still a part of an employee-sponsored plan.
Inform your HSA covered employees that they should put a stop to their contribution to HAS, 6 months prior to Part A coverage enrollment. In order to provide immediate coverage since the first day of retirement, your company needs to explain the open or special enrollment system to employees.
Employees, who are covered with the company, can get their Medicare penalties waived off.
A change in risk pool
The collective risk pool that your insurance covers will change. You will lose some of the older workers, but your pool will welcome others. How does this exactly happen? For example, if you offer family coverage, spouse of a retiring employee may take coverage from you plan, or an employee may retire and take up coverage from another company’s coverage. This switching will impact your insurance rates and claims.
Re-evaluation of program
New recruitment policies and benefits need to be introduced. Younger generation may need different type of compensation and perks. Benefits like student loans help, flex-hours, wellness program, or voluntary activities need to be introduced in your organization to attract and retain younger generation.
Make your organization ready for this shift. Get in touch with JS Benefits Group. We are a group of employee benefit consultants and HR consulting firm in Pennsylvania. We can design multiple health benefit and wellness programs and provide HR consultation for your company by conducting complete organization and market analysis. Call 877 355-6070 and get a custom benefit plan for your company.
