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Baby Boomers and the Great Resignation

by Resource 1 on December 15, 2021

 

baby boomers leaving the workforce

 

From Gen Z to Millennials to Generation X, we have now come to the final generation in today’s workforce: the Baby Boomers. Born between 1946 and 1964, this group has lived through the most pivotal moments in American history. Peaking at 78.8 million in 1999, Baby Boomers remained the largest generation up until 2019. They are the most experienced individuals in today’s workforce, often regarded as workaholics, yet their career future is still uncertain. Is the Great Resignation the time for Baby Boomers to hang up their hats and enjoy retirement?

The Baby Boomer Experience

The time period from 1945 to 1973, encapsulating many Baby Boomer childhoods, is often regarded as the Golden Ages due to the economic prosperity that the country enjoyed. As the Great Depression and World War II became part of the past, Americans returned to normalcy and stability once again, but in a new way. A key element of reemergent normalcy in postwar America was the rise of the nuclear family, as well as that of other phenomena which today we consider commonplace. These include the unprecedented scale of residential construction, alongside a vast proliferation of new household commodities such as automobiles, televisions, appliances, clothing, and furnishings. Also introduced in the post-World War II landscape were the first highways and shopping malls, credit cards, fast food chains like McDonalds, mass media and the advertising industry, and eventually major public schooling reforms for young Baby Boomers.

The nation’s shift toward the new normal was not only made possible by companies like General Electric, who reconverted from military to civilian production, but also by the GI Bill, passed in June of 1944. By its expiration date in 1956, the GI Bill enabled almost 10 million veterans to obtain grants and stipends for school and college tuition, low-interest mortgages and small-business loans, job training, hiring privileges, and unemployment benefits. By 1960, 62% of Americans could claim they owned their own homes, more than 10% of males and 6% of females were enrolled in college, and national GDP reached $543 billion. The GI Bill had successfully induced steady economic growth for years to come. However, a significant criticism of the GI Bill and among many of those “firsts” mentioned above are the ways in which they both failed to benefit, and overtly harmed minority groups.

Interestingly, although many Baby Boomers benefited from postwar economic prosperity, other Boomers came to reject what they regarded as a materialist and repressive culture, leaning into the Hippie Movement of the 1960s. Importantly, other counter-cultures present during this time were the Civil Rights Movement and Women’s Rights Movement. These movements led to the enactment of groundbreaking legislation such as The Civil Rights Act of 1964 and Title IX, as well as cultural shifts like increased tolerance for same-sex relationships, heightened concern for the environment, a record-high divorce rate, and the first oral contraceptive.

In 1976, journalist Tom Wolfe described Boomers as effectively creating a “Me Generation,” rooted in postwar prosperity and characterized by a new attitude of individualism and self-fulfillment. The marketing and consumption of lifestyle products prevailed as things like health and exercise fads and self-help books gained popularity, but the 1970s were not all fun and games. This decade also saw ongoing Cold War tensions, the Watergate scandal, and persistent stagflation. The labor productivity and compensation gap emerged in 1979, increasingly divergent ever since, and unemployment peaked at 10.8% in 1982, the highest rate since the Great Depression, and surpassed only by the 14.8% rate recorded in April 2020.

As the 1980s rolled in and Baby Boomers settled into middle age, many left their Woodstock days in the past and commenced an ideological reorientation toward conservatism. In short, many came to face the practical reality of marriages, children, and mortgages, as well as the stagflation effects mentioned above. In a 1986 Time poll, 64% of Baby Boomers said they had become more conservative since the 1960s. However, many still assert that natural conservatizing effects come with age, as younger generations tend to possess comparatively more liberal attitudes than their older counterparts.

In the 1990s, the US population grew by 32.7 million people, the highest rate since the 1950s, as Millennial children and grandchildren were born. In a 2005 report entitled From the Age of Aquarius to the Age of Responsibility, Pew Research found that 83% of Baby Boomers were parents, and 90% of them said they were very (72%) or somewhat (18%) satisfied with their family lives.  Pew also observed that  29% of Baby Boomers had provided financial help to their parents, and 57% did the same for their children.

While not suffering as many adverse consequences as their younger counterparts, Boomers still saw significant losses in their retirement investments in the aftermath of the 2008 Great Recession. Whether or not they completely recovered these losses depends on the individual. By the first quarter of 2012, retirement account balances reached $9.2 trillion, the highest level ever. But as of 2016, the median-age working family had just $7,800 in retirement savings, while families in the 90th percentile had $320,000 put away, and those in the top 1% had climbed up to $1.7 million or more. Ultimately, due to the unequal distribution of wealth recovery that affected retirement savings, and other factors like increased life span and the desire to make an impact, many Baby Boomers have prolonged their time in the workforce.

Baby Boomer Values and Beliefs

Through life’s ebbs and flows, Baby Boomers have remained steadfast in the workplace. Baby Boomers are hard workers, and as they progressed in their careers, they worked long hours to make headway in their positions. They tend to be loyal to the team, adding value by going the extra mile, and see career as translating into self-worth. Raised on the American Dream, they also tend to be independent and optimistic.

Through their ambition, they show commitment and a slight competitive edge to climb the hierarchical ranks in a company. At the same time, because Baby Boomers grew up without technology enabled interactions, they value human interaction, which has made this technological age of remote work a unique challenge for them. They are making headway into the digital realm, though. As of 2019, 52% of Baby Boomers owned tablet computers, 59% used social media, and 68% owned smartphones, up from 25% in 2011.

Baby Boomers, COVID, and the Workplace

As stated in our blog, Baby Boomers, Generation ‘X’ and Generation ‘Y’ in the Workplace: A Melting Pot of Expertise, Baby Boomers are now retiring in increasing numbers. As of the third quarter of 2021, 66.9% of Boomers are retired, compared to 64% in the same quarter of 2019. Pew Research infers that this recent uptick in retirement will likely be temporary: the Bureau of Labor Statistics projects a 2.7% increase in labor force participation among adults aged 75 and older from 2020 to 2030.

As mentioned above, those making the decision to stay at their jobs are doing so largely due to significant retirement concerns, and partly due to their commitment to work. Additionally, life expectancy has generally increased, meaning that working through retirement age will likely become more standard as time goes on.

Nonetheless, according to University of Texas sociologist Jennifer Glass, a great deal of Baby Boomers are accelerating their retirement plans to spend more time at home with their loved ones. The pandemic caused some sincere reflection, and, as the LA Times reports, older workers who have been laid off are not as willing as their younger counterparts to flock back to the workforce.

In addition, Boomers who wish to continue working often face age discrimination when applying for work, even among those who feel overqualified. But nevertheless, Baby Boomers have already spent years of time and energy on their careers. Rather than retraining in a new occupation, some simply see now as a prime opportunity to hand over the reins.

If Baby Boomers decide to retire, that does not mean they will leave the workforce altogether. A 2014 report by Merrill Lynch found that many retirees adopt new skillsets and move into different lines of work, not for financial reasons, but to have more flexibility, fun, and less stress. Working retirees are also three times more likely than pre-retirees to own their own business or be self-employed, and only 28% would never work for pay again.

If Baby Boomers cannot retire, they are likely staying at their jobs and adjusting to remote work to the best of their abilities. However, they still prefer face-to-face communication. Out of all the working generations, they are the least likely to question whether they should return to the office. According to a Conference Board Survey, Millennials are the strongest challengers with 55% expressing concern about in-person work. Generation X trails Millennials at 45%. Comparatively, only 36% of Baby Boomers dispute this plan.

Baby Boomers supply a wealth of career experience, wisdom, and work ethic to the current workforce. While it’s unclear how long this generation will continue working throughout the Great Resignation era, the legacy Baby Boomers will ultimately leave is truly invaluable. Stay tuned for our final blog in this series that will highlight the key takeaways from each generation and how you can attract and retain talent in today’s current market.

Want to learn more about Baby Boomers and how to retain their talent on your team? Get in touch with Resource 1.