UK companies fear huge skills shortage as baby boomers retire

UK companies fear a major skills shortage in the next five years as a huge wave of baby boomers retire.

New research has found three-quarters of companies were worried that the 'skills gap' resulting from this mass retirement event will have a negative impact on their organisation over the next two years, with an even higher number concerned about the next five-year period.

The 'baby boom' was the surge in the birthrate after the Second World War up until the mid-1960s, peaking in the late 1940s through the 1950s, meaning an equal surge in numbers of those people coming to retirement age 65 years later.

A survey from recruiter Robert Half highlighted the concerns in British business about the shortage in skills this will have, finding 88% of UK finance directors were already taking steps to mitigate the risk of departing baby boomers currently aged between 51 and 69.

Almost half (45%) of finance directors are increasing training and professional development programmes to mitigate the risk, the survey of 200 companies found.

“Employers are facing a profound shift as baby boomers look to exit the workforce, compounding the existing skills gap," said Phil Sheridan, UK managing director of the S&P 500 recruiter.

He suggested a "phased retirement" would be a good idea, offering interim contracts to employees nearing retirement as a means of opening up positions for aspiring managers to move up the career ladder, while using the period to allow older workers provide guidance as a mentor.

"However, it is important to recognise that younger generation X and Y employees will expect different social contracts with their employers and that this should form the second phase of any baby boomer transition planning."