Challenges of an Aging Workforce: The Non-Profit Perspective

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Challenges of an Aging Workforce: The Non-Profit Perspective

Recently, much attention is being paid on a global scale to the negative impact that an aging, or in some countries even "super-aged," population will have on the global economy in the near future.

One industry where news of this generational shift in the workforce is not necessarily "new" is in the non-profit sector. For 10 years or more, researchers have been projecting that as many as three-quarters of all Executive Directors/CEOs of non-profit organizations plan to retire in the next several years.

The recession put many of these retirements on hold temporarily, but as the economic recovery builds, these impending retirements are now becoming a reality in the non-profit world. So, while concerns over global economic indicators make the headlines in the national news, let's take a look at how these generational shifts are impacting the non-profit world more specifically.

No Succession Plan in Place

Ranging from Executive Directors of social service organizations to tenured professors at academic institutions, this trend of high level non-profit employees rapidly progressing towards retirement is well documented. Despite this knowledge, only approximately one-third of non-profit organizations have a succession plan in place as of 2014. This national data from the 2014 Nonprofit Employment Practices Survey is fairly consistent with, if not slightly higher than local research, per the results of the 2014 ERC/Smart Business Workplace Practices Survey.

Although the focus of succession plans is typically directed towards more senior level positions, it is also worth noting 2013 research from the Plan Sponsor Council of America and Principal Financial Group, which indicates that more than half of non-profit respondents expect 10-20% of their overall workforce to retire by 2018. Given the depth of knowledge and experience that any type of long-term staff are taking with them in their retirement, it is perhaps unsurprising that the same study also found that two-thirds of organizations surveyed are predicting that these departures, regardless of their position in the organization, will have a significant impact on their organization when they do occur.

Bridging the “Generation Gap”

This generational shift is also impacting non-profit organizations outside of staffing challenges, in areas ranging from their donor base, to the makeup of their board of directors, to volunteers.

Certainly, striking a balance between implementing the next big technological advancement to attract Millenials to their cause and staying connected to the Baby Boomers in a way that is still meaningful to them is and will continue to be a constant challenge for non-profits and their stakeholders. But, with the help of a growing awareness of the issues likely to arise around these changes to workforce demographics, appropriate sensitivity to the needs of all age groups, investment in leadership development, and yes, maybe even a succession plan, non-profits can still position themselves to face these challenges head on, ideally minimizing the bumps along the way and continuing to pursue their missions through to the next generational shift.

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