Why Baby Boomer & Gen X Retirement May Leave Millennials Coming Up Short

Summer travel dreams are in the making. Soon people will be hoping to fill plane seats to travel to destinations delayed during the height of the pandemic. The prices are high but the planes are full — but wait — there is one seat empty. The front left seat.

No, not in first class. The passengers, and even the planes, may be ready, but there is not a pilot in sight.

CNBC recently interviewed United Airlines CEO Scott Kirby who announced that the airline was bringing 52 Boeing
BA
777s back online to meet travel demand. Unfortunately, there may be planes, but there may not be pilots.

Across the industry COVID halted training for new pilots for nearly two years. However, it was the wave of retirements that greatly accelerated a major pilot shortage. CNBC reports that the airline industry is now attempting to hire a record 12,000 pilots in just the next 12 months. The demand for pilots is so dire that some members of Congress are considering lifting the retirement age of commercial pilots from 65 years old to 67. The industry is also spooling up training efforts and attempting to reduce training costs to attract nextgen pilots. In a related move, major airlines, such as Delta, have dropped the long-standing requirement for a pilot to have four-year college degree.

Air travel may not be the only things disrupted. Supply chain disruption may be as much about disruptive demographics as it is about product availability. My MIT Center for Transportation & Logistics colleague Dr. David Correll’s research shows the labor shortage is multimodal. Correll has has conducted research into the exact same staff shortage problem as aviation among America’s long-haul truck drivers. There too, the population of experienced and skilled operators is aging out, and a worried industry is asking the federal government to step in and get involved.

The labor shortage problem is not unique to transportation. While some Millennials can’t wait for the Boomers and older Gen X’ers to step aside in the job market, there are critical labor shortfalls in many key industries that will be sharply felt by the Millennials as consumers and as the next generation of leadership in business and government.

For example, long before the pandemic the average age of nurses and doctors was well above the nation’s average worker age. Overworked, and nearing retirement age, many of those experienced clinicians are heading for the door. McKinsey recently reported that by 2025 (a mere three years from now) the nation’s healthcare system may be short 250,000 to 400,000 nurses.

Pandemic burnout, regulatory pressures, so-called process improvements in hospitals, patient demand, and other factors are driving many physicians in their 50s and 60s into early retirement or to seek other opportunities in pharma, biotech, etc. The Association of American Medical Colleges forecasts a physician shortage ranging somewhere between 37,800 to 124,000, particularly in primary care, by 2034.

Over the next decade the Millennials will be approaching peak caregiver years supporting their aging parents and loved ones. Similar to many adult children before them, they will seek professional help. Unfortunately, many Millennials may come up short in their search. There is likely to be a shortage of workers in the nation’s senior housing and aging services industry. According to the American Health Care Association – National Center for Assisted Living the long-term care industry lost more than 400,000 workers since the beginning of the pandemic.

While many of these workers are highly specialized professionals and may return to the industry, more than half of the long-term care workforce includes aides and personal care workers that provide vital and direct care to an aging population, e.g., bathing, dressing, feeding. Many of these workers have chosen to move on to other industries with less intimate and demanding tasks as well as better pay, e.g., gig economy, retail, restaurant and hospitality, logistics.

Major sectors of the economy are not finding the workers they need. Shortfalls in pilots, truck drivers, clinicians, trade and construction workers, farmers and many others professions were forecasted long before COVID, but the early exit of many workers was accelerated by the pandemic. Early retirements, population aging, and burnout explains much of the accelerated labor market shift. However, the coming shortfall is about more than pandemic burnout and is not as simple as too few workers.

The Millennials are the largest generation in history. Despite their numbers, evolving industry structure, changing personal career preferences, and problematic access to selected professional opportunities have limited the nation’s largest generation from entering many vital professions.

Unfortunately, as the Millennials age, the first have already turned 40 years old, they may find many of the services, products, and experiences, once provided primarily by Boomers and older Gen X’ers, will be greatly disrupted. That disruption is in the next few years, not necessarily decades away.

How to address the challenge?

There is upskilling, reskilling, or encouraging people to consider multiple careers in a life time to respond to labor gaps. Perhaps, but many of the labor categories coming up short require years of specialized training. Even for those positions that do not require years of education, a social narrative has not been fully developed to suggest to young people that a lifetime of work may be more than a career in a single profession, but instead the pursuit of many different professions across decades of work.

Gen Z to the rescue? Perhaps, but the nation’s birth rate is at a record low. And, there is no indication that Gen Z workers, many already in the workforce, have the preferences, or the skills, that will lead them to where the labor market needs them most.

Automation to the rescue? AI and robots make terrible conversation and are not yet equipped for the most high-touch professions such as healthcare and caregiving. Even autonomous planes, trucks, and cars face barriers. People incorrectly believe that flying is less safe than driving. What will they think when there is no one but an algorithm in the cockpit?

Ensuring an available, capable, and responsive workforce is a critical element of the nation’s economic competitiveness and a challenge that requires urgency and action today by multiple stakeholders in industry, government, education, etc. Unfortunately for my Millennial friends, if all of us, regardless of generation, do not take action today, the impacts of the shortfall will be falling hardest on you.