OCTOBER 2007: FEATURE, AGING WORKFORCE
Labor strains
Oregon industries brace for the loss of the aging boomers and
their experience.
By Jon Bell
John Ferguson
(left) and Bob Nolan at work on the Macy’s
building renovation in downtown Portland. Ferguson,
57, and Nolan, 60, are members of Hoffman
Construction’s graying workforce.
PHOTO BY DENISE
FARWELL
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From where he sits as vice president of Hoffman Construction,
Bart Eberwein sees a good amount of gray hair peppering his
workforce.
The Portland general contracting firm has about 500 salaried
staff members, many of whom work in Hoffman’s offices,
and from 1,200 to 1,500 hourly construction workers who are
employed through subcontractors and union halls depending on
how much work is going on. Eberwein says just looking at a job
site often reveals the advanced age range of workers, but he
also seems to know an inordinate number of construction
superintendents who’ve got not only graying pates, but
also shiny new motorcycles sitting at home just waiting for
their owners to hurry up and retire.
You can’t miss that “the people who are putting
together the buildings on our sites are nearing
retirement,” says Eberwein. “We’ve got an
awful lot of gray beards out there but not a ton of kids
wanting to get into this field.”
Beyond construction, the workforce in general is showing its
age, both nationally and in Oregon. According to the U.S.
Census Bureau, 16% of Oregon’s workers — more than
254,000 out of 1.6 million — are 55 years or older.
And that percentage will continue to rise as more of the
state’s baby boomers head into their golden years and
approach age 65. The first boomers to reach that magic number
will do so in 2011, just four years away.
With age and that increase in retirements will come new and
various strains on the labor market — everything from
worker shortages to increased health-care costs. Some
industries, such as health care, stand to be dinged sharply by
the effects of age; however, many others, such as education,
high tech and construction, may feel the impacts but only in
combination with other, more pressing workforce ailments.
A June report by the Oregon Employment Department titled Will Oregon Have Enough
Workers? examined such trends as baby-boom retirements
and economic growth.
Economic forecasts in the report predict a job growth rate of
about 1.2% to 1.8% a year through 2013. In addition, between
2004 and 2014, OED is anticipating about 245,000 job openings
as a result of economic growth and nearly 500,000 additional
replacement openings because of workers leaving their jobs,
mostly through retirements or a change in occupation.
Ralph Smiley, 87,
on his pear farm in Hood River. “The good die
young and the damn Smileys last forever!” says
Smiley, who is typical of the older farmers who run
Oregon’s many family farms.
PHOTO BY DENISE
FARWELL
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Most of those retirements will involve baby boomers, and many
will affect industries that currently have a high percentage of
workers age 55 and older. The three industries with the
greatest percentages of those workers are mining, utilities and
educational services. Others with high proportions of older
workers include health care, construction, transportation and
agriculture.
Geography affects employment age concentrations as well. For
example, while 16% of workers in Multnomah County are 55 or
older, in rural Wheeler County, it’s 25%.
Mass retirements of these aging workers could trigger labor
shortages, premature promotions for younger, less experienced
workers and a disappearance of institutional
knowledge.
“There are a number of industries that are very
concerned about brain drain,” says Jay Bloom, director of
Multnomah County’s Task Force on Vital Aging.
“They’re very concerned about knowledge going out
the door, particularly in health care and in governmental jobs
at all levels.”
In addition, companies could be forced to import labor from
elsewhere or, more direly, pull up their stakes and head for
greener pastures with larger labor pools.
BUT SUCH WORST-CASE SCENARIOS aren’t necessarily at the
top of the list when it comes to individual industries’
or sectors’ responses to an aging workforce. Instead,
many are taking a measured, long-term approach and factoring
age alongside other workforce concerns.
“We haven’t specifically targeted the aging
workforce yet,” says Agnes Balassa, executive director of
the Enterprise for Employment and Education, a public-private
partnership board that assesses workforce needs in Marion, Polk
and Yamhill counties. “It’s on our shortlist of
issues to be looked at, but I think Oregon’s problem
isn’t as severe as it is in some places.”
“I know it’s something that’s just very
slowly and steadily creeping up on us,” says Bruce
Pokarney, spokesman for the Oregon Department of Agriculture.
“But we’re not doing much on it except trying to
promote agriculture and economic development around
it.”
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OREGON WORKFORCE OLDER THAN 55
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Top 10 aging industries
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ALL INDUSTRIES
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16%
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Mining
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23%
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Utilities
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22%
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Educational services
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21%
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Real estate
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21%
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Transportation, warehousing
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20%
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Other services
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20%
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Health care, social assistance
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19%
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Public administration
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19%
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Ag., forestry, fishing, hunting
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18%
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Professional, scientific, tech.
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16%
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SOURCE: U.S. Census Bureau
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In Oregon, according to Pokarney, the average age of a farm
operator is 54.9 years, and nearly 30% of all farm operators
are 65 or older. Yet the bigger concern is not that so many
farmers are older but that there aren’t enough younger
ones coming on board to take their place.
“It’s just gotten to be a situation where
it’s difficult to pass a farm on to younger operators, or
the kids aren’t interested,” Pokarney says.
Construction, too, has seen its workforce well dry up, not
only as its workers have aged but with the whittling down of
high school vocational classes as well. Dan Graham, president
of the Northwest College of Construction, says the average age
of skilled construction workers is 48 and that roughly 50% of
the construction workforce is expected to retire in the next 10
years.
“What we’re seeing is a mass exodus,” he
says, “and just to keep up with the replacement needs is
huge. We really just need more folks in the
pipeline.”
Not having enough workers, he adds, already has rendered some
contractors unable to bid on projects. That in turn can lead to
higher prices by reducing competition. It also could result in
projects simply not being built.
“Absolutely it will impact the economy,” Graham
says.
Third-highest on the OED’s list of employment areas with
the most older workers is education. Patrick Burk, chief policy
officer for the Oregon Department of Education, says the
average age of Oregon teachers is 44, but there are also
“large clusters of people around their mid 50s, which
puts them around retirement age.”
Like construction, though, education’s main concern is
more about the people coming in than those who are leaving. In
fact, not too long ago during tight education funding, school
districts across the state actively encouraged their older
workers to retire to help save money.
Consider also that, while roughly 800 teachers retired in
2006, the Teacher Standards and Practices Commission of Oregon
issues anywhere between 1,200 and 1,500 new licenses a
year.
“We can keep up with the retirement rate,” says
Burk, “but there’s a more significant issue;
young teachers leaving the profession.”
According to Burk, nearly 37% of new teachers in Oregon leave
the profession within the first five years. Couple that with
retirements, and “that’s what’s driving our
needs,” he says.
ANOTHER ASPECT OF THE AGING workforce issue comes from the
older workers themselves, many of whom want to — or have
to — work longer than previous generations.
Bloom cites studies done by Merrill Lynch that show that
60%-80% of older workers want to work past age 60. They also
want more flexible hours, higher wages, opportunities to
telecommute and phased retirements.
But maintaining a multigenerational workforce full of
differing communication skills, work ethics and career
expectations embodies its own set of challenges.
“We’re concerned not just about the aging
workforce,” says Steve Sechrist, spokesman for Northwest
Natural Gas Co., “but an interesting issue is the younger
workforce and the older workforce in the same company and how
the cultures of those two are different.”
To help address not only the age factor but also other issues
affecting the workforce, many Oregon industries and companies
have already launched significant workforce initiatives.
At Intel, for example, the state’s largest private
employer, spokesman B`ill McKenzie says that in an effort to
help fill a pool of future workers, the company supports
educational programs in math and science that begin as early as
elementary school. As its workforce of more than 15,000 ages,
McKenzie says Intel will look to recruit from a younger, more
diverse population.
In addition, the chip manufacturer, recognizing that older
employees often have older family members to care for, has
begun to offer informational resources to workers.
“Eldercare is rapidly becoming one of the more important
work/life concerns of our employees,” he says.
Graham says NWCC was founded last year as one way to add new
workers to the construction pipeline to help brace against the
departure of older workers. Eberwein says unions in Oregon have
been good about offering apprenticeship training and
industrywide efforts, such as the workforce nonprofit
Construction Apprenticeship & Workforce Solutions, aimed at
grooming a new generation of workers.
Legislative efforts to raise the tax exemption rate on
estates, which proponents say could make it easier to keep
family farms intact and encourage younger workers to take over
the business, didn’t move ahead this past session. But
Pokarney says younger populations who may have initially struck
out on a non-agricultural path often return to farming,
bolstering overall workforce numbers.
And in education, some districts offer job-sharing
opportunities for teachers who may be considering retirement
but are not yet ready to quit for good. Others hire older, more
experienced and often retired teachers as permanent substitutes
as a way to retain institutional knowledge and provide
mentoring opportunities for younger teachers.
Also, the Legislature approved $5 million to fund mentoring
programs so older teachers can help younger ones learn the
ropes.
“It’s a beginning,” says Courtney
Vanderstek, assistant executive director of the Oregon
Education Association. “And maybe now that we’re
not worrying about shutting down schools, we can start having
conversations about using the strengths and skills of our more
experienced workers to add values to the system.”
Jon Bell is a Portland-based
business journalist.
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