Aging
workforce could stall economic development in New England
New Englands
aging workforce could stall economic development and job growth in
the future, according to a report prepared by Northeastern
Universitys Center for Labor Market
Studies. The report was released today as part of The New England
Councils
Older Worker
Initiative. The numbers are particularly significant in Maine, which
has the oldest population in the country.
As
the baby boom generation enters retirement age, New England
employers will become increasingly dependent on older workers
those aged 55 and above
"This is particularly true
in Maine, which has the oldest median age population in the
nation,,
said James Brett, president and CEO, of The New England Council, the
nation
Mercer Human Resource Consulting is the lead company sponsoring this
Initiative which is operating working group sessions around the
region to develop strategies on this issue. James McCaffrey, Mercerrs
New England Market Leader and member of the Councils
Board of Directors, is chairing the Initiative. He said the issue,
at its core, will likely result in public policy changes to the
nation
We believe that New England is
at a critical juncture. The aging population creates important
challenges and significant opportunities for developing strategies
to respond to these inevitable workforce changes. We need to develop
specific proposals to encourage the active engagement of older
workers in the employment market,
McCaffrey said. Retirement regulations
both on a state and federal level
often actually encourage workers to
retire early and not return to the workforce. In New England, we
could find a significant gap of available employees and skilled
worker shortages that ultimately will hinder our ability to add jobs
and grow.
Paul Harrington, Associate Director of Northeastern Universitys
Center for Labor Market Studies, said the findings in Maine are
particularly striking.
All of the growth in the Maine
labor force over the next decade will come from those aged 55 and
older, Harrington said.
Unless the aging population is replaced
by increasing numbers of younger workers or the labor force
attachment of older workers increases sharply, the graying of the
labor force will result in labor shortages and hamper economic
growth.
Some of the report highlights:
- Maine has a larger and more sharply growing share of the older
population (age 55 and older). The proportion of the states
population that is 55 years or older has increased from 19 percent
in 1950, to 24 percent in 2000, and 27 percent in 2005.
- In 2015, one in three Maine residents are projected to be 55 years
or older and by 2030, older persons will comprise 39 percent of all
the residents of Maine.
- The older population is projected to be the source of all
population growth in Maine during the 30 years between 2000 and
2030.
- Maines population is getting older at
a higher rate than the nation. In 2005, the median age of Maine
residents was 41, compared to the median age of 36 for the rest of
the country. In Maine, the median age is projected to be 43 in 2015
and 47 in 2030.
- At the same time, the state has seen a sharp decline in birth
rate. Between 1990 and 2004, the birth rate in Maine declined by 25
percent, compared to a 15.8 percent decline in the rest of the
nation.
- While teens and young adults in Maine are more likely to
participate in the labor market than their counterparts in the
region and in the nation, the rate of labor force participation
among those aged 55 and above is below that of the nation as a
whole.
As part of this Initiative, business leaders will meet with public
officials in Portland Wednesday to discuss a variety of issues
including: pension policies that limit workers
ability to mix work and retirement income, workforce development
programs that do not serve older workers, and the need for the
workplace to accommodate an older workforce.
The Council plans to host meetings around the region in the coming
months, examining the status of older workers in each state and
engage public and private leaders in discussion of the issues.
The New England Council, founded in 1925, is an alliance of large
and small companies, colleges and universities, nonprofit and other
agencies, dedicated to promoting economic development and a high
quality of life in the six-state region.
Mercer Human Resource Consulting is a global leader for HR and
related financial advice and services, with more than 15,000
employees serving clients in more than 190 cities and 40 countries
and territories worldwide. The company is a wholly owned subsidiary
of Marsh & McLennan Companies, Inc., which lists its stock (ticker
symbol: MMC) on the New York, Chicago, Pacific and London stock
exchanges.