A recent Globe & Mail article cited the Conference Board industrial relations outlook when pointing out that baby boomers will start retiring in “droves” in 2010. Of course the retirements have started and we are already seeing some of the implications. Rather than focus entirely on the “skills shortages” and what that will mean to the staffing industry (I blogged about this a little already), I thought I would point at a few other implications.
1. Investment Portfolios.
There will be a number of implications as the boomers retire … and there are numerous articles addressing this issue. The very large boomer population will move their assets to less risky instruments”; many of them will convert to cash; they will certainly become more risk averse which will affect portfolios. Is your advisor watching this?
2. Real estate.
No prizes for guess where this might go … boomers downsizing and not enough people buying their larger homes. Boomers moving South to warmer climates. Boomers moving out of the suburbs and either into downtown condos, or maybe even moving to the “cottage”. It could be hard to unload high end homes and cottages could be good investments! Will there be a slow down in house building … some experts think that there will.
3. Health Care.
The Canadian health care system is paid for from taxes. The tax base will decrease as boomers retire and those aging bodies will become more of a burden on the system. Will the government allow a 2-tier system? The boomers will be able to afford to pay … and the US offers the services just across the border, so … who knows?
4. Trade Unions
The unions have traditionally fought hard to protect jobs, but companies are going to need the flexibility of outsourcing and staff augmentation in order to meet their business needs. If the companies can’t get what they need to be in business then in a global market we may see more companies move operations offshore. The unions role may shift with the priorities of its membership who will want benefits and pensions.
The travel industry might do OK. Boomers will have some disposable cash and they well elect to spend some of it traveling.
Contributions may decrease with less people in the workforce, but there may also be an increase in available labor to help out.
7. Strategic HR Consulting
Every company of any size is going to be facing the issues of succession planning, retention of corporate knowledge, hiring and retaining talent! The federal government has a particularly daunting task with supposedly 45% of the executive ranks eligible for retirement in the next few years. The way their pensions work there is little incentive to stay on! So …perhaps a great career for the next while will be in helping those corporations plan for the future.
I’m sure there are many implications that I am missing, but this promises to be an interesting time, with tons of opportunity for those able to bring answers. Did I mention how important the staffing industry will be through this period?