Michael Nix December 12, 2008
Economics Professor Hamilton
Baby boomers effect on generation X and Y During the next five to 10 years, millions of baby boomers will be retiring, essentially heading for the exits en masse. This exodus will create a demographically driven worker shortage that will put the power back into the hands of the job seekers. That means that today’s workers will eventually be able to say good-bye to static or shrinking paychecks, and that today’s unemployed can look for an end to all that pavement pounding.
Peter Cappelli, a management professor and the director of the Center for Human Resources at The Wharton School, conducted research that questioned these assumptions about the potential economic impact of an aging employee population. Cappelli found that any projected labor shortage caused by retiring boomers is, in fact, a complete fiction. True, the generation following the boomers the so-called baby busters is about 16 percent smaller than its predecessor, but with an average age of 30, the busters, who already have been in the workforce for a number of years won’t be retiring anytime soon and are both willing and more important, able to fill any voids left by the departing boomers. Add to that the fact that the generation after the busters is composed of the boomers’ offspring and is therefore relatively large, and that many members of that generation are currently in college and will be looking for work in a few years. Putting all that together, Cappelli concludes that the future pool of skilled employees is the kind most in demand by employers. Given the lousy state of retirement accounts, coupled with increased life spans, it’s unlikely that everyone who turns 65 will be decamping for that gated community in Florida. And even many who can afford to retire will choose not to, although they may change jobs or