Just as they entered the world in large quantities following World War II, baby boomers—and even older Gen Xers—are now exiting the workforce in a mass retirement.
This is set to worsen preexisting labor shortages across industry sectors, including low-skill level roles, complex blue collar roles, healthcare industry jobs, and even highly skilled white collar roles.
As this mass exodus shakes up the workforce, companies are scrambling to retain workers for long enough to develop succession plans and thoughtful knowledge transfers so valuable skills and knowledge don’t simply walk out the door with these workers. One creative and straightforward strategy is to consider offering a flextirement program.
When you think of flextirement, you might think of someone who retired from their full-time career only to reenter the workforce, picking up a part-time role as a substitute teacher or retail position at the local store to keep busy or be social.
However, this is not the case. If you haven’t heard of flextirement before, you are not alone. But the market and labor conditions are pressing for something new and that solution is flextirement.
Flextirement has everything to do with striking a balance between employees and employers as opposed to flipping the switch from employee to retiree. Flextirement would allow employees the opportunity to semi-retire, never fully leaving their current job or finding a new opportunity but working in some part-time capacity. This could be focused on key initiatives, a project basis, or a mentorship role.
This concept allows companies to retain experienced and invaluable workers longer, so they can pass their deep knowledge on to others, mitigating catastrophic knowledge gaps and empowering the younger generation of workers.
In many cases, employees could traditionally do their own work as a 1099 consultant, but there is value to both parties when they can remain an employee, participate in employer benefits programs, and maintain consistency while exploring the early days of retirement.
Flextirement would act as a new employee status. This would allow for a worker (existing or new) to work part time but also enjoy their time off, working when it fits for both parties. Therefore, as workers come closer to retirement, they don’t have to abandon their careers and expertise to hit the pickleball courts. They can continue contributing to a company and a career that has been an important part of their life for decades.
THE ROI ON FLEXTIREMENT
Flextirement is a mutually beneficial arrangement in which the employee receives flexibility to retire in the capacity that works for them and the employer retains valuable knowledge to be passed on to Gen X, millennials, and Gen Z as well as the company as a whole. There are very few disadvantages to this arrangement with the exception of reevaluating and developing policies to allow for this type of program. In fact, there are mostly pros.
Especially on the employee side, flextirees can continue to further the professional career they have spent years committed to, challenge their cognitive abilities, and keep themselves sharp as they transition into a more relaxed lifestyle. Plus, because they have more control over work schedules and greater flexibility to work anywhere, they can prioritize family, travel, and other important opportunities as they wind down their career.
On the employer side, flextirement helps gradually transition those employees who have been contemplating retirement for years but just aren’t quite ready yet. It also promotes the mentoring and training of more green talent, which creates a competitive advantage for companies down the line. Instead of bidding goodbye to these seasoned professionals and their knowledge and skills, innovative employers gradually transition these insights to future leaders and younger colleagues.
When you break down the cost of flextirement, the decision to adopt becomes even clearer. When it all boils down, these companies are getting highly sought after talent, traditionally very expensive workers, for a fraction of the cost.
For example, a salesperson late in their career might make upwards of $150,000 a year, but if they are working part time in a mentorship/transition role, the organization is getting their full array of knowledge for only $60,000 a year. Sure, it’s fewer hours, but the depth of experience and the detailed knowledge, which can be imparted on a salesforce, are invaluable.
In some cases, companies may choose to forgo offering benefits to any part-time employees, including flextirees, which will save money. On the flip side, benefits like transportation and healthcare further entice employees to express interest in a flextirement program versus figuring out healthcare on their own. Regardless, flextirement lessens the cost of turnover and continued education as these professionals act as critical bellwether for their stakeholders and the corporation.
Employers need to have a clear picture of their employees’ perspectives when it comes to retention. Many of today’s programs are built around the retention and morale of younger workers, but flextirement is a key program for senior employees. For this demographic specifically, there are a few things they are considering that can be used to develop the flextirement plan that best fits your organization.
For example, these employees are stepping back to look at their career, and evaluating whether or not they love what they do and the company they do it for. While you might not have any control over their opinion of their career to this point, you do have a say in the values, ethics, and culture your company displays to make these employees feel supported. These employees are also considering their options elsewhere, so if they enjoy coming to work, they are more likely to consider staying.
Flextirement solves numerous problems set in motion by the largest generation to date leaving the workforce en masse, but can also benefit generations to come. The concept is representative of where the future of work is headed as it allows the necessary flexibility to prioritize the important things in life, like family, health, and travel, while also allowing skilled workers to continue delivering in the capacity that suits them. Flextirement is the future of work, and the sooner companies embrace it, the sooner they can start reaping the benefits.
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