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Originally published April 9, 2008 at 12:00 AM | Page modified April 9, 2008 at 1:19 AM

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Companies find ways to retain expertise of older workers

A serious health scare a decade ago convinced Dave Gromala that there's more to life than work. Someday, he'd find a way to retire early...

Seattle Times staff reporter

A serious health scare a decade ago convinced Dave Gromala that there's more to life than work. Someday, he'd find a way to retire early from Weyerhaeuser so he and his wife could explore more of the fun stuff in life before growing old.

But late last year, after he crunched the numbers, the dream looked premature. "When you even think of trying to retire at age 55, the calculator explodes," he said.

His pension hadn't grown enough, the stock market was having fits and his future medical needs were unknown.

Gromala started searching for an alternative. His timing was perfect.

Worried about an impending labor shortage and the loss of expertise, Weyerhaeuser had just joined the ranks of employers nationwide that are creating strategies to delay the retirement of valued older workers.

Historically, senior workers have received incentives to leave their jobs early to make room for the next generation. But a change in thinking is under way. As baby boomers march toward retirement, too few younger workers may be available to fill the gap.

Weyerhaeuser asked Gromala if he'd like to help kick off a new delayed-retirement program by going part time while still accumulating a pension and enjoying company-paid health insurance.

"It was like finding a bunch of Easter eggs," Gromala said.

The graying of the work force is expected to challenge many countries.

In the United States, employment is expected to increase by nearly 19 million jobs over the decade ending in 2014, about 2.6 million more than the previous decade. But in that same period, 36 million people are expected to leave the work force permanently, according to the Bureau of Labor Statistics.

At Weyerhaeuser, company research found that 40 percent of employees nationwide would be eligible to retire by 2010. Decades of knowledge and institutional memory could vanish.

For now, the company is most concerned about certain job categories, such as scientists and engineers in the forestry division, which require deep expertise.

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"If we were in a growth mode, this would be even harder to deal with. We'd be scrambling for even more talent and we'd be scrambling across the board," said Sally Hass, director of retirement education.

Census data show that by 2030, nearly 20 percent of the population will be age 65 or older, compared with about 12 percent in 2000.

In King County, some of the employment sectors significantly affected by the aging work force are education, public administration, manufacturing, health care and utilities.

As more people retire, many industries could see a dramatic impact on productivity and profits, according to a February report of the Task Force on the Aging of the American Workforce, launched in 2006 by the U.S. Department of Labor.

Most people say they'd like to work in some capacity even after traditional retirement age, the report says. But age discrimination, limited opportunities and federal pension and tax laws can discourage working in older age.

The task force and others urge an array of remedies: recruitment of older workers, flexible work arrangements, financial education and new scrutiny of federal regulations forged decades ago to make room for baby boomers.

"We're all facing this challenge," said Cindy Wall, a spokeswoman for Boeing. "Right now we're able to get all the people we need. But will that be the case in five years? "

Passing on expertise

Boeing has started a program to transfer older workers' knowledge to the next generation. And when an employee announces he'd like to retire, "we ask them why," said Duane Schireman, director of human resources for Boeing's 787 "Dreamliner" program.

Sometimes the person would like to keep working, just not 40 hours a week. On a case-by-case basis, Schireman said, managers and the employee explore such options as job sharing, telecommuting and contract work.

Boeing, in collaboration with other aerospace employers, also is trying to remove barriers that may force people into retirement before they're really ready.

The city of Seattle is completing a risk analysis to learn where potential labor gaps and loss of institutional knowledge may occur due to retirements. The average age of city employees is 48.

Group Health is addressing the issue after learning that 42 percent of its 890 registered nurses are age 55 or older. To extend their careers, the health-care organization is offering nurses who are five years from retirement opportunities to mentor and teach, as well as do part-time work after retirement.

It's also making sure older nurses, who are at greater risk of injury on the job, have the best equipment for handling patients.

Yet most employers are unprepared or don't have the luxury of dealing with the aging work force, often because they're embroiled in shorter-term economic crises.

"Furthest from their minds is putting more money into retaining older workers because they don't even know what the business horizon is," said Valerie Paganelli, a Seattle-based retirement consulting actuary and researcher on the aging work force.

"Still, they may well need to in order to bridge their way to the next level of success."

And there's debate about whether the predicted labor shortage will occur, given that boomers are expected to be healthier and stay in the work force longer. Many haven't saved enough to retire.

A gradual retirement

Weyerhaeuser's new delayed-retirement project, called Gray Matters, is grounded in research about the attitudes of its employees age 55 and over. The vast majority say they want to work longer rather than completely retire. But they want it all — a flexible schedule, health-care benefits and no negative financial impact.

And they want the work to be meaningful.

In response, Gray Matters offers selected employees the opportunity to retire gradually, but they must average 25 hours of work a week in order to keep health benefits. The part-time work also shouldn't go on for too many years or it could negatively impact their pension. Still, working part time rather than retiring entirely ultimately builds a bigger nest egg.

During this phase-down, they're expected to create a plan to transfer knowledge and mentor younger workers. The company also is participating in a talent bank, to be run by an outside firm, that will offer retirees a chance to work on a temporary basis.

"What we all want as employers is the best talent we can have," said Hass, retirement educator at Weyerhaeuser. "And what we ought to recognize is that the best talent can come at any age."

When the program started in January, Gromala cut back to three days a week as director of codes and product acceptance, a highly specialized job he's held for 18 years. His pay is 40 percent less and his pension is accumulating at a slower pace.

His time is divided among long-term projects, solving problems and guiding younger employees. Already, the more junior staff no longer asks, "How should I handle this?" Instead, they just keep him informed.

It feels a little scary, like maybe he's not needed anymore. But "so be it," Gromala said.

Meanwhile, he insists he's really not partially retired. He simply bought an extra 10 weeks of vacation. And if this mix of more free time and less job keeps feeling right, why stop?

Marsha King: 206-464-2232 or mking@seattletimes.com

Copyright © 2008 The Seattle Times Company

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