Baby Boomers, Gen Xers, Millennials.
If you're in any way involved in the recruitment of technical and engineering professionals for the oil industry you're sure to be familiar with these terms. These various generational cohorts all have their own contributions to make to the industry as we face ‘The Great Crew Change'.
But now there's a new cohort that could make a big difference in solving the looming skills gap- Perennials.
The Perennial Workforce
Loosely defined as ‘workers of 55 years and older, who have decided to return to the workforce', Perennials represent a powerful new demographic within the workforce. In the U.S., Perennials represent the fastest-growing population of workers, with twice as many over-55s as teenagers currently employed. It's a change which is expected to continue according to the U.S. Bureau of Labor Statistics; in the 30-year span from 1994 to 2024, workers aged 55 and older will go from being the smallest segment of the US working population to the largest.
Nor is this a phenomenon confined to the Americas. Other industrialised nations are experiencing similar trends. In Japan and South Korea, the proportion of their workforces comprising Perennials is rising even faster.
It's a global shift which will see the composition of workforces radically change. Consider the following; Globally, the number of people aged 60 and over is projected to double to more than 2 billion by 2050 (World Health Organisation), at which point those 60 and over will outnumber children under the age of 5.
Labour force participation is increasing amongst older workers and it's a trend which isn't going to go away. According to one study (Retirement Patterns and the Macroeconomy 1992-2010, The Gerontologist, June 2015), about 60 per cent of older workers with a ‘career job' retire and move on to a ‘bridge job'; that is, a short-term and/or part-time position.
Perennials as a dynamic segment of the workforce
There is ample evidence to suggest that Perennials make a valuable contribution to the workforce, and that today's engineering and technical businesses should do more to craft an employer value proposition targeting this cohort.
Firstly, the perception of older workers does not align with reality. New research from German economist Axel Borsch-Supan reveals that as workers age, contrary to popular opinion their productivity rates do not decrease. Instead, with knowledge-based jobs productivity increases with age and eventually plateaus.
Older workers can also aid overall team performance. A Stanford University study conducted at an auto plant examined three teams; one made up of all young workers, one made up of all older workers, and one of mixed older and younger workers. It was the latter team that performed best. The productivity of the mixed-age group was the best as they benefitted from the knowledge and experience of the older workers as well as the skill and speed of the younger workers.
Research from the Milken Institute's Center for the Future of Aging and the Stanford Center on Longevity found that older employees took fewer sick days, showed stronger problem-solving skills, and were more likely to experience job satisfaction than younger colleagues.
There are also significant benefits to the economy when Perennials remain in (or return to) the workforce. Not only does remaining in work improve the health of over-55s thus reducing governmental healthcare expenditure, but as Paul Irving, Chairman of the Milken Institute Center for the Future of Aging, states, “keeping older people working means they remain taxpayers. With their increased financial resources and confidence and ongoing engagement, they are likely to continue to consume. The more people are actively engaged in the economy, the more likely the economy is to grow. That's good for everyone”. Estimates already put the spending power of Americans over the age of 50 at $7.6 trillion per year. By 2020, with their increased representation in the workforce, over-50s are expected to have grown this spending power to $15 trillion annually.
Whilst the focus of this article examines the impact that Perennials could have upon the oil industry, it's important to note that this cohort is also having a demonstrably positive impact upon other sectors of the economy including the broader engineering industries, consulting, and even retail and FMCG.
Only with a comprehensive understanding of what Perennials want, can oil companies then begin to craft a compelling employer value proposition for this generation of workers. Research indicates that there are plenty of workers with experience in the oil industry who would fall into the Perennial cohort. A workforce survey conducted by Oil & Gas UK in 2018 revealed that the average age of Britain's oil industry workforce is 43 and getting older. Therefore, in addition to recruiting millennials, hiring managers should also factor in the recruitment and retention of Perennials as part of their workforce planning strategies.
Attracting and retaining Perennials
It's never easy to assess the wants and needs of an entire cohort.
After all, each generation is made up of individuals with their own wants, needs, desires and aspirations. However, an increasing body of research does point to some consistent expectations from Perennials regarding their ideal employment options.
What are these expectations, and what can employers do to create a workplace that is attractive to Perennials?
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