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South Dakota Rural Enterprise Opportunity Roundup - resettling retirees

What are the social and economic challenges that are looming as our population ages, especially the implications for the small and micro business sectors? What about the recruitment of retirees and soon-to-be retirees as a development strategy?

  • The Australian federal government is policy-targeting these challenges: to encourage older workers to stay in their jobs, in spite of the obvious trend towards employers favoring the recruitment of younger people.

  • A group has developed a Shades of Gray taskforce in Oklahoma (to study the effects of the retiring baby boomers on services and transportation). They looked closely at other states and how they attracted seniors to their state and found a lot of information in Florida online and from the state government office on elderly. For example, Florida pays your house off for you if you are 65 and only owe 20,000 dollars or less. They also figured out that every retiree produces 1 ½ service workers. So....retirees are considered extremely good for Florida.

  • Affluent suburban areas in Bay Area are stating in their economic development planning process that they want to RETAIN retirees due to their spending power and stabilizing influences.

    • Many retirees are thinking of cashing out of expensive house and moving out of state, and many suburban communities are heavily populated by same 25 to 30 year+ household demographic who moved there when age 29 or 30 and is now age 59+ (and has $500K to over $1M in home equity).

    • CA cities depend on sales taxes to large extent, so economic development committees focus on impact of losing long-time residents to other states and resulting perceived drop in sales taxes This is a higher priority to many than "attract new jobs." Since unemployment rates in these communities are extremely low, and new jobs mean traffic congestion and even higher housing prices, things shift to retaining spending power for retailers.
  • The Bay Area ended up writing a goal and strategies encouraging "move down, inexpensive" market rate housing development and active adult communities, within the San Ramon Ec Dev Plan. Retirees are usually strong in housing plans, and senior service plans, but now boomers are aging and more are concerned about economic impacts.
  • An adult generation that is about half the number of the retiring Baby Boomers makes a 10-20 year shortage for all sorts of skilled workers (plus the lack of pipelines to train their replacements.) Businesses that require skilled and semi-skilled workers will use some mix of these strategies (and others):
    • Subcontracting to either other businesses or individuals (talk about training and technical assistance needs and perhaps new roles for business incubators)
    • Giving up and staying at the size and crew they manage to retain, quite often built around the owner's personal skills (and health.) The trap Michael Gerber identifies so clearly in his books.
    • Developing an in-house training program and resources beyond periodically watching and yelling at new employees for awhile. Online, on-demand courses on CD/DVD, manufacturer-supplied training etc. should continue to boom...look at the training provided franchisees by franchisors or military training as the probable models. Since this is endlessly specific and changing, it should be a huge opportunity for many very small businesses to fill as well as a very confusing search for most businesses trying to pull together programs. Look at offerings like Ed2Go...
    • Worker productivity enhancement by all means, Toyota Lean Production, Deming Quality, Goldratt Theory of Constraints, etc. will have the energy that the quality movement did in the 1980's as making the most out of whom you've got becomes ever more critical when you can't staff up. We've seen a lot of that in the past 15 years but I think that's the Early Adoption or maybe Early Majority phase, not the peak.
    • Expert Systems software applications will be huge and pervasive as really it's our only shot to replace the tremendous amount of painfully learned judgment leaving through retirement. Whether this becomes the elusive panacea of the giant software companies or something far more useful and small scale like Lotus Notes, object-oriented programming, Hypercard, Linux, etc. will be fought out over the next 20 years probably by companies that don't exist yet as well as Microsoft, Sun, IBM, and Oracle. Maybe it'll all be web-based and worldwide idea-drawing like Linux...
    • While we've been seeing blurbs about robotics and automation taking over many jobs and functions for 70 years now, look at CNC machine tools, computer-driven sewing machines and sergers, On-Star and engine sensors in cars, lasers, onboard diagnostics, etc....what we tend to ignore amidst the hype is that many jobs they dumb down...uh, shorten… the training cycle needed to get reliable performance...or eliminate the need to pay attention to them at all which is compelling in an era of an ill-trained, impatient workforce. That suggests opportunities for thousands of small innovative companies identifying niches within processes, industries, applications, etc.. Neil Gershenfeld's new book "FAB" shows how these companies may well fit into a modern two car garage or rec room while producing precise, innovative manufactured items using tabletop CNC/CAD/CAM like Boxford's.
  • A group in Colorado is working on the development of a small business coaching team who will be available via call-in phone sessions. The idea is to tap into some of the expertise we have here with people who have actually done business and making them available to groups across the US who can tap into their experiences. There will be a fee for the coaching sessions, but the wealth of knowledge they can tap into will be superb. We are assembling various teams such as retail, restaurant, manufacturing etc.

There's a growing body of books and studies out there:

  • "Age Wave" by Ken Dyctwald
  • "Great Expectations" by Landon Jones
  • "The War for Talent" by McKinsey & Co. folks
  • "Fat & Mean" by David Gordon
  • "The Double Income Trap" by Elizabeth Warren

and others.

 

Opportunity
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