It’s a fact that our industry has an aging workforce, and as our most senior team members retire, their experience and institutional knowledge retires with them, a concept often referred to as “boomer brain drain.” While the boomer brain drain issue is not unique to our industry, it is expected to hit companies with a high percentage of boomers on their team especially hard. The companies who deal with it effectively will likely have a leg up on the competition. For others, it can be a ticking time bomb. In this feature, readers discuss this issue, and weigh in on strategies for tackling boomer brain drain.
This month’s real issue on boomer brain drain was suggested by two readers who both offered up different approaches for dealing with a problem that’s getting attention across industries. We combined their ideas into a brief, three-question survey, which was sent to their fellow readers who’ve opted in to receive our email communications. A big thank you to the 260-plus readers who took time to share their views and experiences. If you’d like to participate in future Real Issues surveys, send a note to operations@LBMJournal.com, and we’ll make sure to get you added.
First, we wanted to gauge how big of a problem boomer brain drain actually is, so we asked readers to let us know where they and their company stand on this issue. As the chart shows, it is definitely an issue for the vast majority of respondents. Only 6% aren’t concerned at all, while 45% are very concerned, and 49% are somewhat concerned. The reason for the concern, or lack thereof, is clear in the comments.
“We have 13 employees and the average age is 65. The knowledge that will be missed when these gentlemen retire will be very hard to replace.”
“With a staff that hovers around 60 people, 1/4 of those have been with the company 20+ years—and in the industry even longer. Yes, we’re concerned.”
“We are doing our best to transfer the knowledge of the older employees to the younger ones. The hurdle is that the older employees typically came up through the trades or at least started at the bottom of the industry learning as they went. Today’s employees don’t want to spend that kind of time.”
“It is a very good thing that the few remaining baby boomers are retiring. Sadly, the experience and industry knowledge that we will be losing will be hugely overshadowed by the cultural advantages the company will gain when they leave. To lead into the future and successfully foster happy, productive employees, we need leaders who value a strong work/life balance, autonomy, flexibility, trust, generous pay and benefits. That is how we will begin to lure young workers into our industry and away from tech. Boomers simply can’t comprehend this and, frankly, it’s really hurting our industry. They need to retire and soon. It’s a great thing.”
“Three key members of our staff are 65+. Two others are in their mid-fifties. Finding people to teach and train to take those positions is proving to be a real challenge.”
“I am in the middle of taking over the business my boss started with his wife over 30 years ago. I tried very had to absorb as much as possible before getting to this point, but with me actively trying to learn all there is possible to learn or learn how to source, I still feel like I have only scratched the surface. I rely heavily on the institutional knowledge that is in those aging noggins and feel somewhat comfortable that I’ve effectively absorbed a lot. But once they are gone, I’ll be stuck holding all this information without someone who has a true interest in the industry. The best I can do for now is to put all this info in a book and have any new employee reference to it as a Whole of the Industry (as-it-pertains-to-us) Guide.”
“Tenured workers leaving companies can have a beneficial effect. Sometimes tenured employees often resist necessary changes to process, methods and technology which can slow the whole company down.”
“How could you not be?”
“I’ve lost over 100 years of experience in the last 24 months.”
“We have been following a succession plan for years in order to plan for these retirements. This also provides for cross-functional training so employees are trained and can step into additional roles.”
“More so concerned about losing the work ethic of the older generation.”
“I’m it, the aging workforce. My company doesn’t seem to be too worried about my retirement. The new ‘me’ generation is buying right now and don’t really care with the old ways. So, I’m guessing it will be fine to just go forward.”
“We are trying to document as much ‘tribal knowledge’ as possible before the old-timers leave.”
“We have a lot of older employees that are retiring. The experience and knowledge that is going with them is astounding. The younger generations are learning the business but are not nearly as hands-on as the ones that are leaving. The older generation worked in the field and actually did the work, so their knowledge is extensive.”
“I’m retiring this year and I am confident that those who we’ve trained up will do just fine. You have to remember that our LBM customers are aging and retiring as well, and younger employees will relate to their peers’ needs as well as our generation has with ours.”
“We’re extremely fortunate when it comes to this question. We’re a small, close knit group who have been together for many years. There’s no doubt in my mind that all of us are extremely capable of passing on our duties and responsibilities and philosophies to our subordinates because we’ve done it before. In our corporate culture, the ‘circle of life’ will continue without interruption, confusion, or chaos.”
Boomer brain drain Question 2: What would you say to this dealer?
“Our company has many employees with 20 or 30-plus years of experience. I’m concerned that as they retire and take their industry knowledge with them, our company will lose an important asset. To allow our most tenured employees the opportunity to recuperate and refresh (and hopefully stay with us longer), we’re considering offering a one-month sabbatical—or extended vacation time—after 20 years. We think this perk may help establish our company as a great place to work, and to help recruit more new talent to our industry.
“We’re also considering establishing a formal mentorship program to connect our most experienced people with the next-gen team members, in order to keep that institutional knowledge alive at our company. Before moving forward, we’d like to know how other dealers are dealing with this challenge?”
“We will be dealing with this in about three years. It would be great to teach the younger generation all they need to know, but we can’t seem to get anyone into this business. I will really struggle in getting replacements when my people leave. Most of them have been here over 20 years.”
“Be very careful about who you have mentoring whom and be specific about the information you want passed on. Training a new generation to ‘do it like this because that’s how we’ve always done it’ is not likely to lead to positive outcomes. The mentoring process needs to be organized and managed closely.”
“As an outside salesman, the idea of a sabbatical sounds great, however, who handles the work in the meantime? I am allowed three-weeks vacation, but never take that amount of time because no one else can do my job for me while I’m away.”
“Don’t get depressed about your older, knowledgeable, workers leaving. Younger workers can relate better with the newer young builders. Find them from high school counselors, trade schools, community colleges.”
“We are in the early stages of formally training the next generation by identifying future leaders and working with them in small groups. Your plan sounds much more comprehensive and I like it. It may cause some pain points but ultimately it will help solve the issue.”
“I am a 31-year veteran in the LBM business, and have just started recruiting for the retirement of my team. I have employees who plan to retire in 2-3 years, with others in 6-10 years. We have hired three people in certain CSR positions that can move up and in when needed to take over. Yes, training for the future is the way to go! Don’t wait til the last minute.”
“I don’t think a sabbatical after 20 years is enticing to the younger generations. Millennials, and I am on the cusp of that classification, value more balance for their young families now, not time off as they near retirement. They also want continual feedback, which our veteran staff is not great at giving. I think mentorship needs to be a two-way street between generations, we each have things to learn from one another. I think the mentorship component is good, but the environment for learning has to be tailored to the mentee, which sometimes is very hard for someone who isn’t a talented mentor. Attraction of talent comes from providing a thriving, challenging, teamwork environment, with plenty of frequent two-way feedback.”
“We started a mentorship program and offered Sr. manager/Sr. rep titles for those individuals. The sabbatical is a good suggestion.”
“We offer retiring staff members the option to reduce their hours gradually or remain in some part-time capacity. We currently have one retired inside salesperson set up to work at home doing estimating. It’s a win/win. He can work on his own schedule 10 – 15 hours a week completing estimates efficiently without interruption and we retain the skill set and knowledge. On the flip side, we are working to make our facilities and work/life balance programs better fits for the incoming generations.”
“We allow our tenured employees to take extended vacations, they choose whether to use vacation or other PTO to fill their paychecks. We also allow them to convert their position to part-time if they wish. We do not have a formal mentorship program, but are considering one. Without a structure, it seems that mentoring doesn’t happen to the extent that we’d like it to.”
“Our company moved to four weeks vacation after 15 years several years ago and it has been appreciated by our long tenured employees. We have discussed a mentorship program but haven’t adopted one.”
“I agree that finding ways to extend the older workforce’s ability to stay on and mentor is a smart plan. Trying to get these employees to work past retirement to pass along their knowledge, work ethic and experience is the tricky part. Possibly offering part time status during this transition might also be a win for the business and the retiree.”
“That is a great idea! Most small lumberyards can’t offer the same benefits as the big boxes, so they have to do more things like this to keep or attract younger employees. The older employees have more to offer than they realize.”
“I would suggest that they ask their older employees what is most important to them. Maybe they want to work off-site. Maybe they would like to work a modified schedule.”
“We have implemented a process called Traction, based on a book written by Gino Wickman. It introduces you to the EOS system. This is where you put the Right People in the Right Seats. It’s all about accountability! This is where we are concentrating our efforts to ensure the future of our company along with mentors for those seats. We have found the overall system is very helpful in all aspects, this one particular area is what we believe is going to help us the most. I encourage all to give it a read.”
“I feel the sabbatical is a great idea. Give them some extra time, in return you get the knowledge to be passed on to the next generation.”