The financial services sector is experiencing a pervasive talent and age gap. Financial services is likely to be impacted the most by the expanding talent shortage, facing a global deficit of 3 million professionals by 2020 (Korn Ferry). As of 2018, one quarter (26%) of the sector is occupied by workers over the age of 55, nearly double from 1998 at 14% (Deloitte).
A combination of trends, according to Deloitte, which could develop into a profitable solution for financial services leaders: mature workers occupy a large percentage of the workforce while young talent seems scarce. Employees ages 25-54 slipped from 76 to 68% between 1998 and 2019, and employees under age 24 decreased from 10 to 6% in financial services.
Mature workers are here to stay
Boomers are still in the workforce, and they’re not going anywhere. American employees ages 65 and older (referred to as mature workers or perennials) make up the fastest-growing labor pool in the US. Those born between ~1930 and 1950 make up a unique workforce generation known by many as "Perennials" or the "Ageless Generation."
The U.S. Bureau of Labor Statistics predicts workers ages 65 and older will enter the workforce faster than any other age group through 2024.
Mature workers are eager and ready to build on the extensive knowledge they possess: they acknowledge the need to sharpen their skill set to adapt to evolving digital practices seen across global business–FI’s in particular.
More than 60 percent of older FI respondents indicated they need to continually update their skills to do their jobs effectively in a digital environment, higher than younger FI respondents do.
Yet, financial services leaders are focusing talent practices on young talent–“digital natives” who, having grown up with technology, may need less training as business practices lean digital. Interestingly, young workers want nothing to do with the sector. Just 4% of Millennials reported interest in finding work in financial services (The Hartford), and young talent currently working in financial services want out: Deloitte recently found that 40% of millennial and Gen Z financial services employees would prefer to work in the technology industry.
Here are two ways financial services leaders can work against the growing talent gap:
Use Mentoring to Bridge the Gap
Older workers, especially those seasoned in financial services, possess valuable knowledge which can be leveraged to bridge the generational gap. Create a mentorship program or workshop to allow older employees to share soft skill expertise accrued over long, prosperous careers. The same applies in reverse; facilitate information exchange with digital workshops led by young talent to keep generationally diverse workers on the same page.
Prioritize Upskilling
Invest in tailored education and training to prepare for the sector’s digital future. Tailor learning experiences to the individual–young and older workers possess radically different learning styles. A boomer may respond better to training that integrates with the work they’re doing and provides timely feedback, for example.
