In the May 16, 2005 issue of Fortune magazine, author John Helyar wrote on the opening page: “Welcome to the cold, new world of the prematurely, involuntarily retired.” Here are some of the key highlights of new economic and corporate trends, and new terminology used to refer to different age groups in today’s employment market:

Time length in finding a new job:
50 and Fired compares the changes in trends since Fortune magazine’s first survey in 1999 with the new trends 14 years later. In 1999, it took executives an average of 8 months to find a new position; while today the average length is 16 months or longer, if one is lucky enough to even find a position. The current reality is many jobs held by former executives will likely never return.

New corporate “species”:
The involuntarily retired, the involuntary consultant, the involuntary entrepreneur, those creating multi-revenue streams, and the unlucky ones on a permanent vacation

New terms and new tactics to move out the “old”:
Started by Jack Welch at General Electric (GE), who created “an elaborate system” to weed out unwanted employees. Employees were put in one of three categories: the top 20% ranked A — hot shots and high pots (younger workers with “high potential”), the middle 70% were strong B players and were relatively “safe,” and the bottom 10% — the blockers (those who occupied rungs on the corporate ladder) were Cs and were gone. GE’s Jack Welch called it the “vitality curve.”(The generic HR term for this is “forced ranking.”) Capital One followed this pattern to get rid of high-level, older execs by packing the C tier with older workers (48-year-old workers were being fired by 30-year olds). A lawsuit ensued that was settled out of court.

New causes for getting rid of “older” executives:
*The mindset of Human Resource managers: in a survey of 428 HR managers, 58% said older workers “didn’t keep up with technology,” and 28% viewed older workers as “less flexible.”
*The “profound, age-neutral economic transformation, where age 50+ workers “reached their peak years during an economic perfect storm”
*Bottom-line demands of Wall Street
*Steady rise in health care costs
*The abundance and availability of younger, cheaper professionals such as systems analysts from China and India (off-shoring)

Predicted economy trends that will impact today’s workforce:
*A new infrastructure of work when today’s 35-year-olds reach 55, and a more liquid labor market in which people can phase into retirement
*A shift in demographics: from 2002 to 2012, the U.S. Bureau of Labor Statistics projects “the number of 35- to 44- year-olds in the labor force to decline by 3.8 million; while the number of 55- to 64-year-olds will increase by 8.3 million”

Advice by counselors/HR managers (interviewed and cited):
“Never stop networking, even if you land a job.”
“Never confuse regaining leverage with returning to what they [you] once knew.”
“Forget the paycheck…your W-2 days are over. It’s a 1099 world now.”
More advice on what to do and not do when executives are fired (page 86 of this article):

“What if it happens to you?”

(reprinted with permission from CMI E-bridge 274 – 6-20-05)

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