By George Case
Faculty Member, Retail Management at American Public University
Everywhere we turn, it seems we are seeing older workers in the retail work force. Walk into virtually any big box store, and the greeter is more than likely an older citizen. On the surface, it appears the age of the retail workforce is increasing.
There is no denying that the average age of workers in specific retail segments has risen. In the fast food industry, the average age has increased to 29.5 (in 2014) from 22 (in 2000). Yet, only 2.9% of workers in the fast food industry are 55 and over. However, other retail segments have historically lower- aged workers. In clothing, 31% of all workers are under the age of 24. So what do these numbers mean in regards to the changing face of the retail workforce?
For years, most job gains have occurred in the 25-54 year-old age group. According to the U.S. Department of Labor, this is about to change. In the coming decade, 35% of added workers are expected to be over 55 years of age. Job growth in the retail segment is projected at 10% over this span, on par with other occupations. However, with a higher rate of turnover, this means there will be more retail jobs available.
Looking at the entire workforce, the percentage of older workers has increased. In 2000, 13% of the labor force in the U.S. was aged 55 and up. This percentage will increase to 25% by 2020. There are a couple of reasons for this increase. First, the baby boom population is aging. By 2020, the youngest of the boomers will be more than 55. Perhaps the more pertinent factor for this expected increase is the realization many boomers have that their retirement savings are not sufficient to adequately meet their needs. Quite simply, people cannot afford to retire at 55 or 60.
Due to the visibility of many retail jobs, it is easy to make assumptions based on first impressions. The workforce is aging, but is the average age higher in retail than in other trades? When the retail trade is ranked with all other industries, a more complete picture emerges. In fact, the percentage of 55 year- old- and- over workers in the retail industry is slightly below the average of all industries. Nineteen percent of retail workers fall in this category, while the entire workforce is slightly more than 21%.
The question is not if the retail trade workforce is aging. It is, but not any more quickly than other industries. The key perspective is for retailers to focus on how they will deal with an aging workforce. There are risks in having an older workforce. The needs of older workers are different than those of younger workers. How does a retailer motivate a 55 year- old as opposed to an employee in their 20’s? How much is an employer willing to invest (in terms of training) in a 60 year- old? What does an older workforce mean for employee benefits and healthcare needs? How will retailers manage healthcare costs? What will it take for a retailer to attract a younger workforce?
Moving forward, a successful retailer must balance the need to invest and train younger employees while also hiring and motivating an older workforce.
Hayutin, A, Beals, M. & Borges, E. (2013). The Aging U.S. Workforce: A Chart of Demographic Shifts Stanford Center On Longevity July 2013. Retrieved from http://longevity3.stanford.edu/wp-content/uploads/2013/09/The_Aging_U.S.-Workforce.pdf
U.S. Department of Labor Statistics. Retrieved from http://www.bls.gov/home.htm
About the Author
Professor Case has spent 20 years in the Retail Management industry, 12 as a business owner. Joining a small business in the early 1990’s, he was instrumental in the company’s growth and expansion into multiple states. Professor Case earned his MBA from Case Western Reserve School of Management in Cleveland, OH and his BA from Macalester College in St. Paul, MN .