It is no longer a secret that businesses are finding it hard to staff their businesses. The truth is though, that this has been a reality coming for over 3 decades now.

And as thing potentially get worse for businesses and staffing, it will become every more important for you as a business owner to understand the origins of this new plague sweeping through the job market.

Lest you turn around one day, at a loss at how to fill the hole in your company, wondering how things ever got this bad.

The US is suffering the beginning phases of a great a demographic drought that is projected to worsen throughout the century and will impact every business, college, and region. This is no COVID paradox. This is history catching up with us. We’ve been approaching the edge of this cliff for decades.

Regardless of what you think the ideal global population size might be, or whether you think our biggest problem is too few people or too many, a sharp and sudden population reduction will have enormous implications for the economy and the lifestyle we all take for granted. The ability to order a package and see it in days, to buy a cup of coffee on your way to work, to enjoy a wealth of affordable consumer goods, to have our garbage collected, to fill a prescription, to receive nursing care—all these functions depend on an army of workers that simply cannot be replaced if they were never born.

But where did this all come from?

How did the greatest economy in the world lose all of its people? Did they die? Where did they go?

Paradoxically, we can see, that if we go back to the beginning, we’ll quickly discover that the generation that built the greatest and wealthiest economy man has ever seen also have created it’s downfall.

Between the years of 1946 & 1964, 76 million Americans were born. And these Americans were the type of Americans you read about in the magazines.  

Hard working, morally upright, could change your tire on the side of the road and place a short against big business in the market.

These were the Baby Boomers.  

But there are 3 key truths that we all need to know about the Baby Boomers as we begin to understand where this demographic drought has come from.

Key Truth No. 1.

The Baby Boomer's Built The World We Live In

To understand where everyone went, we need to first understand the legacy of the baby boomers.

As their generational nickname suggests, boomers are the product of the enormous surge in births after World War II.

After falling steadily through the Great Depression, the US birthrate swung upwards, and peaked at nearly 27 births per 1,000 people in 1949.

In the years following the baby boom, exponential global population growth seemed inevitable for the foreseeable future. Not only were people having a lot of babies, but, thanks to advances in medicine, nutrition, and living conditions, these babies were now surviving infancy in greater and greater numbers.

Those same advances that reduced infant mortality also helped raise adult life expectancy to historic highs. The combination of fertility and longevity has pushed the global population toward nearly 8 billion as of 2020. That number is expected to swell to nearly 10 billion by 2050.

The baby boom shaped our view of the future of the world’s population, particularly the possibility of overpopulation.

For years, people naturally assumed that baby booms would be a continuous and exponential growth driver.

Let’s look at the effect of boomers on the labor force and hiring norms. Boomers were a labor force explosion that powerfully shaped hiring norms

The population explosion meant tremendous growth in the labor force, growth whose benefits we’ve enjoyed since the 1970s.

And because women began entering the workforce in much higher numbers than in any time since World War II, the workforce and consequent productivity gain was twofold.

From when the data was first collected in 1948 to the late 60s, the LFPR for women over age 25 jumped from 30% to 40%. Once the first female boomers entered the workforce in the early 1970s, their LFPR shot up even more, hitting 60% by the mid 90s.

This was a powerful combination: an enormous population of boomers and extraordinary growth in female participation. The US labor force swelled to unparalleled levels.

The workforce gained a massive generation, then nearly doubled it as women joined the men.

So, all of us should be saying thank mum and dad, or grandma and grandpa. You really put in a shift for us!

But then we have key truth number 2.

Boomers Are Existing The Labor Force Faster Than Ever.

We’re still living in the world of work created by the boomers, but boomers are no longer its core participants.

As of 2016, millennials became the single largest group in the labor force—a group that is showing radically different attitudes toward work, which presents new distinct challenges.

According to Pew Research Center some 2 million baby boomers retire each year. In 2020, this number appears to have grown to an historic high: over 3 million decided to end their careers. Much of this is likely related to the fact that over the past year, work has become significantly more remote, exhausting, and isolated.

Further, many boomers were surely worried about catching the virus and opted to stop out.

And given boomers’ high net worth and decreased need to punch the clock, they have wide latitude in their career decisions.

Incidentally many boomers were pushed out of the labor force due to job loss. But now probably seems as good a time to retire as any.

This alone is likely having a far greater impact on the labor market than is being reported. Why? Boomers are often vacating higher level and highly valued positions in their companies.

Many boomers helped build those companies, hold senior positions, and, most importantly, have many years of accumulated knowledge and experience, which will be tremendously difficult to transfer over to younger workers.

As companies attempt to replace these boomers, they will be greeted with a massive challenge.

And what is that massive challenge?

Well, that is key truth number 3.

The Biggest and Hardest Working Generation is Not Being Replaced.

2020 sped up an inevitable process: the accelerated exit of baby boomers from the economy they created is being compounded by the fact that boomers are not being replaced.

For the US population to reproduce itself—-meaning, for current population numbers to stay the same— the total fertility rate (TFR) needs to equal 2.1 children per 1 woman.

When the TFR stays at or near 2.1, one child is born to replace every person now living. In other words, the population doesn’t grow, but it is at least replaced.

Yet, with a few annual exceptions, America’s TFR has been far below 2.1 since 1971.

This means that there aren’t enough millennials and Gen Zers to fill boomers’ shoes.

Boomers spent more time on career and income, and less on reproducing themselves. While boomers were born into families with an average of four children each, boomers themselves had an average of just 1.8 children.

Thus, as they leave the workforce, there simply aren’t enough workers to replace them. 

With the great exodus of the boomer generation, who is filling the gaps behind them and what are those generation like? 

Do they have the attitudes and abilities to build and sustain the greatest economy that has ever existed?