Cathie Ramey
RedwoodAge.com 

With the bulk of the American workforce made up of boomers, small businesses are preparing for the brain drain that will hit when those workers retire.

While large and small companies are worried about the coming shortage of talented workers, a survey of 400 small business owners by the National Association of Professional  Employer Organizations shows nearly one-third of small businesses are outpacing larger firms in their efforts to create "knowledge transfer" plans to deal with the problem.  

There has been growing concern by analysts that US companies are not fully acknowledging the impact the mass exodus of experienced workers could have on the future. The departure of 78 million boomers from the workforce will speed up in 2011 as they start turning 65 and will continue for a period of at least two decades; some have already retired.

"An aging workforce is creating major change across the nation," says Gene C. Wilson, president of the business consulting firm Pantheos.  "Small business owners value their older workers and want to make sure the knowledge they've gained over the years is conveyed to younger workers now."

A separate survey shows that a shortage of talented workers is now the top concern of employers. Almost three-quarter of companies listed that as their No. 1 worry, just ahead of the cost of health insurance, according to the survey by Deloitte Consulting and the International Society of Certified Employee Benefit Specialists.

That said, US businesses may have a little more time than they realize to execute their knowledge transfer plans. It turns out that many boomers are not planning to retire when they reach the magic age of 65 because they can't afford to retire.

Two in five workers - aged 60 to 64 - plan to delay retirement citing the desire to keep working. Money was the main reason they cited. This is up from last year, when approximately one out of every five older workers planned to continue working.

Wilson says it's good news that a growing number of boomers want to keep working and are able to do so.  

Owners, Too
Small business owners are also hesitant to leave the business world when they reach retirement age. A recent Gallup Small Business Index survey showed 9 out of 10 small business owners will not be ready to retire at age 65 because of the unknowns related to future health and financial concerns.

Ironically, owning your own business becomes more attractive as you age.  A 2007 AARP paper reports nearly one-third of  business owners became self-employed after the age of 50. 

For many years older workers have been looked upon as more of a liability than an asset. It appears however, that opinions are changing for the better.

Realizing the implicit value of their older workforce, businesses are approaching the brain drain from another perspective and creating campaigns to keep older workers on the job. Flex-time, phased retirement, part-time hours, and telecommuting have all been introduced as enticements to retain skilled boomers.

"Business owners will want to hold onto good people, no matter what their age," said Wilson. "That's why such a large percentage of them are formulating plans to proactively retain these older workers for their valued skills knowledge and experience."