The American Workforce: Transformational Changes and Challenges for the Chemical Industry
Over the past two years, the American workforce and its employers have undergone significant changes. The chemical industry, in particular, has felt these changes acutely due to an aging employee base and challenges in recruiting top new talent. This combination represents a significant threat to chemical companies, necessitating a renewed focus on growing and retaining a skilled workforce to remain competitive, agile, and profitable. Here, we examine the state of the chemical industry workforce and how leading companies can leverage technology to win the talent war.
Aging Workforce: A Pressing Issue
The US chemicals industry employs some of the oldest personnel across all sectors. As of 2023, the median age of the chemical industry’s workforce was around 44.7 years, compared to 42.3 years for the total US workforce. A significant portion of the workforce (25%) will be eligible to retire within the next five years, potentially leaving thousands of jobs unfilled Judging by those numbers, it’s hard to think of 44 as old, but the disparity in the average age is worrisome for chemical companies.
Sources – (Deloitte United States) (WEF Forum).
Plug the Brain Drain
To address talent shortages, the chemical industry should focus on retaining and recruiting older workers. By 2030, it’s projected that nearly 20% of the U.S. population will be 65 or older, with this age group expected to comprise over 10% of the workforce, a roughly 55% increase from 2019.
The pandemic accelerated retirements, but many older workers are now rejoining the workforce. About 32% of retirees aged 62-71 have returned to work, presenting an opportunity to leverage their experience. Notably, 90% of baby boomers consider their tech skills on par with or superior to younger colleagues.
Older workers are staying in the workforce for reasons beyond just income. By creating a supportive culture that values their expertise and offers flexible schedules and more paid time off, chemical companies can better attract and retain these valuable employees.
Sources – (U.S. Census Bureau, 2024 projections, National Institute for Occupational Safety and Health, 2023 report (CDC) (Census.gov) (SeniorLiving.org)
Attracting New Talent
To build a future-ready workforce, chemical companies must attract millennials and Gen Z workers. These younger generations prioritize technology in the workplace. Companies that invest in advanced business management technologies, such as ERP, CRM, HRMS, and IT systems, create an innovative environment that appeals to tech-savvy candidates.
Technology at the core
Investing in digital enterprise strategies is crucial. While chemical companies have traditionally focused on R&D technologies, there’s a growing need to modernize finance and operations systems. This digital transformation drives efficiency and innovation across all departments, making the industry more attractive to younger talent and more efficient overall.
Conclusion:
Leveraging the expertise of senior employees and integrating this knowledge into advanced technological processes can bridge the generational gap in the chemical industry. Currently, the industry depends on individual decision-making by experienced personnel, which can lead to inefficiencies. By capturing key information and creating technology-driven workflows, companies can streamline operations. This approach not only enhances efficiency but also frees senior employees to mentor and coach the younger workforce, fostering the development of the next generation of chemical industry leaders.
