Shrm aarp 2012 strategic wp-final-revised

SHRM Survey Findings:
SHRM-AARP Strategic Workforce Planning

April 9, 2012

Definitions

 Strategic workforce planning assessment: Evaluating an organization’s current and future critical talent
needs using workforce modeling and scenario planning to identify potential skills gaps and talent shortages.

 Older workers: Employees at an organization that are age 50 or older.

 Younger workers: Employees at an organization that are age 31 and younger.

SHRM-AARP Strategic Workforce Planning ©SHRM 2012 2

Key Findings

 Have organizations conducted strategic workforce planning assessments to evaluate their current and
future critical talent needs? Two-fifths of organizations (40%) have conducted strategic workforce planning
assessments to identify their future workforce needs for the next 5 years. About one-third of organizations
have identified their potential skills gaps for the next 5 years (36%). Twenty-nine percent of organizations
have analyzed the impact of workers age 50 and over leaving their organizations.

 Are organizations preparing for a potential shortage of talent when older workers begin to retire in
greater numbers and leave the workforce? Although many organizations are at the initial stages of the
preparation process, there has been a slight increase in awareness of a potential shortage of younger
workers with the requisite skills needed to replace older workers who are retiring. More than one-quarter
(27%) of organizations indicated they are becoming aware of the issue, an increase of nine percentage
points from 2010 (18%). Thirty-nine percent of organizations are beginning to examine internal policies and
management practices to address this issue (e.g., succession planning, phased retirement, etc.), showing no
difference from 2010. Additionally, roughly one-fifth of organizations (18%) indicated that no changes were
necessary after their evaluation, a decrease of 12 percentage points from 2010 (30%).

 How much of an issue are the potential losses of talent for organizations and industries as older workers
retire or leave their organizations over the next decade? Approximately one-half (46%) of organizations
believe that potential loss of talent over the next decade is a potential problem for their organization while
27% indicated that it is not a concern. As older workers exit the workforce over the next decade, 39% of
organizations believe that this will cause potential problems for their industry; however, approximately one-
quarter (24%) do not foresee problems for their industry.


Key Findings

 What are the perceived skills gaps between younger and older workers? Approximately one-half of
organizations (51%) indicated that writing in English (grammar, spelling, etc.) was the top basic skills gap
observed between younger and older workers. Fifty-two percent of organizations reported
professionalism/work ethic as the top applied skills gap between younger and older workers.

 Which steps are organizations taking to retain and recruit older workers in order to prepare for the
potential skill gaps that may occur as younger workers enter and older workers exit the workforce? Nearly
one-half of organizations (45%) have increased training and cross-training efforts. Roughly one-third (38%)
of organizations have also developed succession plans and/or hired retired employees as consultants or
temporary workers (30%). Organizations are also offering flexible work arrangements (27%) and offering
part-time positions to older workers (24%).


Has your organization conducted a strategic workforce planning assessment to…?

Identify future workforce
needs over the next 5 40%
years?

Identify potential skills
gaps over the next 5 years? 36%

Analyze the impact of
workers age 50+ leaving 29%
your organization?

Note: n = 421-423. Percentages shown indicate only the respondents who answered “Yes” to this question.



Comparisons by organization sector
Publicly owned for-profit organizations are more likely than privately owned for-profit organizations to have conducted a strategic
workforce planning assessment to identify potential skills gaps over the next 5 years.

Comparisons by Organization Sector

Publicly owned for-profit (50%) > Privately owned for-profit (30%)

Comparisons by organization staff size
Organizations with 25,000 or more employees are more likely than organizations with 1 to 2,499 employees to have conducted a
strategic workforce planning assessment to identify future workforce needs over the next 5 years.

Comparisons by Organization Staff Size

1 to 99 employees (25%)
25,000 or more employees (66%) > 100 to 499 employees (36%)
500 to 2,499 employees (36%)

Note: Only statistically significant differences are shown.



Comparisons by organization staff size (continued)
Organizations with 25,000 or more employees are more likely than organizations with 1 to 2,499 employees to have conducted a
strategic workforce planning assessment to identify potential skills gaps over the next 5 years.


500 to 2,499 employees (33%)

Organizations with 2,500 or more employees are more likely than organizations with 1 to 499 employees to have conducted a
strategic workforce planning assessment to analyze the impact of older workers leaving the organization.


2,500 to 24,999 employees (47%) 1 to 99 employees (22%)
>
25,000 or more employees (49%) 100 to 499 employees (22%)



There may be a shortage of younger workers with the skills and qualifications
necessary to replace the older workers who are preparing to retire. Which of the
following best describes your organization’s preparation for this change?

Beginning to examine internal 39%
policies and management practices 39%

Just becoming aware of the issue 27%
18%

Have examined our workforce and
18%
determined that no changes in our 30%
policies and practices are necessary

Have proposed specific policy and 7%
management practice changes 4%

Have implemented specific policies 2012 (n = 326)
5%
and management practices 5% 2010 (n = 337)

Have agreed internally on a plan to
4%
change policies and management 4%
practices

Note: Respondents who answered “Don’t know” were excluded from this analysis.


Overall, how would you describe your organization’s and industry’s potential loss
of talent as a result of the possibility of the older workers retiring, or leaving the
organization for other reasons, over the next decade?

It is a crisis It is a problem It is a potential It is not a
problem problem
Organization 1% 26% 46% 27%
(2012; n = 407)
Organization 2% 20% 45% 33%
(2010; n = 369)

It is a crisis It is a problem It is a potential It is not a
problem problem
Industry 7% 30% 39% 24%
(2012; n = 374)
Industry 3% 29% 47% 21%
(2010; n = 317)

Note: Respondents who answered “Don’t know” were excluded from this analysis.


In your opinion, what are the greatest basic skills gaps between younger workers
and older workers?

Percentage

Writing in English (grammar, spelling, etc.) 51%
Technical (computer, engineering, mechanical, etc.) 33%
Mathematics (computation) 16%
Reading comprehension (in English) 13%
English language (spoken) 12%
Government/economics 10%
History/geography 6%
Science 5%
Foreign languages 3%
Humanities/arts 1%
Other 9%

Note: n = 421. Respondents who answered “Don’t know” were excluded from this analysis. Respondents were asked to select their top two choices.
Percentages do not equal 100% due to multiple response options. “Basic skills” refer to knowledge and basic skills in the areas above.

In your opinion, what are the greatest basic skills gaps between younger workers
and older workers?

Government agencies are more likely than privately owned and publicly owned for-profit organizations to believe that
government/economics is the greatest basic skills gap between younger and older workers.


Privately owned for-profit (8%)
Government agencies (23%) >
Publicly owned for-profit (5%)



In your opinion, what are the greatest applied skills gaps between younger workers
and older workers?

Percentage
Professionalism/work ethic 52%
Critical thinking/problem solving 27%
Written communications 16%
Lifelong learning/self-direction 16%
Leadership 15%
Oral communications 12%
Ethics/social responsibility 12%
Information technology application 11%
Teamwork/collaboration 10%
Creativity/innovation 4%
Diversity 2%
Other 2%

Note: n = 421. Respondents who answered “Don’t know” were excluded from this analysis. Respondents were asked to select their top two choices.
Percentages do not equal 100% due to multiple response options.

Has your organization taken any of the steps below to prepare for potential skill
gaps and/or retain and recruit older workers?

Yes No
Increased training and cross-training efforts 45% 55%
Developed succession plans 38% 62%
Hired retired employees as consultants or temporary workers 30% 70%
Offered flexible work arrangements (e.g., job sharing, telework, etc.) 27% 73%
Offered part-time positions to older workers 24% 76%
Offered retirement planning programs 23% 77%
Developed processes to capture institutional memory/organizational
17% 83%
knowledge from employees close to retirement
Increased recruiting efforts to replace retiring employees 17% 83%
Offered financial planning programs 16% 84%
Offered wellness programs that are attractive to older workers 14% 86%
Provided training to upgrade skills of older workers 13% 87%
Encouraged older workers to work past traditional retirement age 12% 88%

n = 415

gaps and/or retain and recruit older workers? (continued)

Yes No
Tailored benefits offerings to encourage older workers to stay with
11% 89%
organization
Increased automated processes (e.g., use of robotics) 9% 91%
Created new roles within your organization, specifically designed to
9% 91%
bridge a skills or knowledge gap
Provided opportunities for older workers to transfer to jobs with
8% 92%
reduced pay and responsibilities
Asked older workers for feedback via survey or other mechanism
4% 96%
about what would encourage them to stay with the organization
Established alternative career tracks for older workers 3% 97%
Other 5% 95%

n = 415


Publicly owned for-profit organizations are more likely than privately owned for-profit, nonprofit and government organizations to
have developed succession plans in preparation for potential skills gaps that may occur as younger workers enter and older
workers exit the workforce.

Comparison by Organization Sector

Publicly owned for-profit (56%) > Nonprofit (31%)
Government (26%)

Government agencies are more likely than publicly owned for-profit organizations to have developed processes to capture
institutional memory/organizational knowledge from employees close to retirement to retain and recruit older workers in
preparation for potential skills gaps that may occur as younger workers enter and older workers exit the workforce.
Government (32%) > Publicly owned for-profit (9%)

Government agencies are more likely than publicly owned for-profit organizations to have encouraged older workers to work past
traditional retirement age in preparation for potential skills gaps that may occur as younger workers enter and older workers exit
the workforce.
.

Government (26%) > Publicly owned for-profit (7%)


Comparisons by organization sector (continued)
Government agencies are more likely than publicly owned for-profit or privately owned for-profit organizations to have hired retired
employees as consultants or temporary workers in preparation for potential skills gaps that may occur as younger workers enter
and older workers exit the workforce.
.
Publicly owned for-profit (24%)
Government (51%) >



Organizations with 25,000 or more employees are more likely than organizations with 1 to 2,499 employees to identify future
workforce needs over the next 5 years in preparation for potential skills gaps that may occur as younger workers enter and older
workers exit the workforce.

500 to 2,499 employees (36%)

Organizations with 2,500 or more employees are more likely than organizations with 1 to 499 employees to have developed
succession plans in preparation for potential skills gaps that may occur as younger workers enter and older workers exit the
workforce.

2,500 to 24,999 employees (58%) 1 to 99 employees (27%)
>
25,000 or more employees (66%) 100 to 499 employees (31%)



Comparisons by organization size (continued)
Organizations with 25,000 or more employees are more likely than organizations with 1 to 499 employees to have increased
recruiting efforts to replace retiring employees in preparation for potential skills gaps that may occur as younger workers enter

Comparisons by Organization Size
25,000 or more employees (37%) >

Organizations with 500 to 24,999 employees are more likely than organizations with 1 to 99 employees to have hired retired
employees as consultants or temporary workers in preparation for potential skills gaps that may occur as younger workers enter

500 to 2,499 employees (38%)
> 1 to 99 employees (16%)
2,500 to 24,999 employees (42%)

Organizations with 500 to 2,499 employees are more likely than organizations with 1 to 99 employees to have offered financial
planning programs in preparation for potential skills gaps that may occur as younger workers enter and older workers exit the
workforce.


500 to 2,499 employees (23%) > 1 to 99 employees (7%)


How effective has the step(s) your organization has taken been in preparing for
potential skill gaps and/or retaining and recruiting older workers?

Too soon Not at all Somewhat Very
to effective effective effective
evaluate
Developed succession plans (n = 157) 27% 3% 52% 17%
Created new roles within your organization, specifically
26% 6% 37% 31%
designed to bridge a skills or knowledge gap (n = 35)
Increased training and cross-training efforts (n = 179) 24% 1% 50% 26%
Developed processes to capture institutional
memory/organizational knowledge from employees 22% 1% 56% 21%
close to retirement (n = 68)
Offered wellness programs that are attractive to older
17% 5% 53% 24%
workers (n = 58)
Offered financial planning programs (n = 66) 17% 3% 52% 29%
Increased recruiting efforts to replace retiring
15% 4% 62% 18%
employees (n = 71)
Offered part-time positions to older workers (n = 99) 15% 3% 38% 43%

Note: Response options were only rated by respondents who indicated that their organization had taken the specified step to prepare for potential skill gaps
and/or retain and recruit older workers. Percentages may not equal 100% due to rounding.

How effective has the step(s) your organization has taken been in preparing for
potential skill gaps and/or retaining and recruiting older workers? (continued)

Too soon Not at all Somewhat Very
to effective effective effective
evaluate
Offered flexible work arrangements (e.g., job sharing,
14% 2% 50% 35%
telework, etc.) (n = 111)
Tailored benefits offerings to encourage older workers
11% 7% 55% 27%
to stay with organization (n = 44)
Increased automated processes (e.g., use of robotics)
11% 0% 63% 26%
(n = 35)
Provided training to upgrade skills of older workers
11% 2% 64% 23%
(n = 53)
Offered retirement planning programs (n = 95) 11% 7% 51% 32%
Provided opportunities for older workers to transfer to
9% 9% 59% 22%
jobs with reduced pay and responsibilities (n = 32)
Encouraged older workers to work past traditional
8% 6% 52% 34%
retirement age (n = 50)
Hired retired employees as consultants or temporary
4% 4% 49% 43%
workers (n = 123)

Note: Response options were only rated by respondents who indicated that their organization had taken the specified step to prepare for potential skill gaps
and/or retain and recruit older workers. Percentages may not equal 100% due to rounding.

To the best of your knowledge, what percent of employees, full-time and part-
time, at your work location are age 50 or older?

1%
None
1%

27%
1% to 19%
32%

44%
20% to 39%
47%

24%
40 % to 59%
17%
2012 (n = 404)
2010 (n = 363)
4%
60% or more 3%


To the best of your knowledge, what percent of employees, full-time and part-
time, at your work location are age 50 or older?

Privately owned for-profit organizations are more likely than government agencies to have 1% to 19% of their staff age 50 or older.


Privately owned for-profit (33%) > Government (9%)

Government agencies are more likely than privately owned for-profit organizations to have 40% to 59% of their staff age 50 or older.


Government (40%) > Privately owned for-profit (19%)

Organizations with 100 to 499 employees are more likely than organizations with 2,500 to 24,999 employees to have 1% to 19% of
their staff age 50 or older.


100 to 499 employees (34%) > 2,500 to 24,999 employees (12%)


Demographics: Organization Industry

Percentage
Manufacturing 19%
Health care and social assistance 18%
Professional, scientific and technical services 18%
Public administration 12%
Finance and insurance 10%
Education services 8%
Transportation and warehousing 8%
Administrative and support and waste management and remediation services 6%
Information, publishing industries 5%
Utilities 5%
Accommodation and food services 4%
Construction 4%

Note: n = 399. Percentages may not equal 100% due to multiple response options.


Demographics: Organization Industry (continued)

Percentage
Religious, grant-making, civic, professional and similar organizations 4%
Retail trade 4%
Repair and maintenance 3%
Wholesale trade 3%
Agriculture, forestry, fishing and hunting 2%
Arts, entertainment and recreation 2%
Mining 2%
Real estate and rental and leasing 2%
Personal and laundry services 1%
Other 9%

Note: n = 399. Percentages may not equal 100% due to multiple response options.


Demographics: Organization Sector

Privately owned for-profit
organization 46%

Publicly owned for-profit
19%
organization

Nonprofit organization 20%

Government sector 12%

Other 4%

Note: n = 398. Percentages do not equal 100% due to rounding.


Demographics: Organization Staff Size

1 to 99 employees 19%

100 to 499 employees 33%

500 to 2,499 employees 24%

2,500 to 24,999 employees 15%

25,000 or more employees 9%

n = 390


Demographics: Other

Does your organization have U.S.-based Is your organization a single-unit organization or a multi-
operations (business units) only or does it unit organization?
operate multinationally?
Single-unit organization: An organization in
U.S.-based operations only 70% which the location and the organization are 32%
one and the same
Multinational operations 30%
Multi-unit organization: An organization that
n = 407 68%
has more than one location
n = 404

Which HR department/function was responded For multi-unit organizations, are HR policies and practices
about throughout this survey? determined by the multi-unit headquarters, by each work
location or both?
Corporate (companywide) 69%
Business unit/division 17% Multi-unit headquarters determines HR policies
50%
and practices
Facility/location 14%
Each work location determines HR policies and
n = 282 3%
practices

A combination of both the work location and
the multi-unit headquarters determine HR 48%
policies and practices
Note: n = 282. Percentages do not equal 100% due to rounding.


SHRM-AARP Strategic Workforce Planning

Methodology

 Response rate = 15%

 Sample composed of 430 randomly selected HR professionals from SHRM’s membership

 Margin of error +/- 5%

 Survey fielded February 13, 2012 – March 12, 2012

For more survey findings, visit www.shrm.org/surveys
Follow us on Twitter: http://twitter.com/SHRM_Research

Project leader:
Christina Lee, SHRM Research
Project contributors:
Jean Setzfand, vice president, Financial Security, AARP
Ed Redfern, Jr., senior Issue specialist, Financial Security, AARP
Mark Schmit, Ph.D., SPHR, vice president, SHRM Research
Fred Emmert, Senior Speechwriter & Speakers Bureau Manager, SHRM
Evren Esen, manager, SHRM Survey Research Center


Shrm aarp 2012 strategic wp-final-revised

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