The silver tsunami — the aging of the baby boom generation — is posing a challenge to Idaho employers throughout the state. In Idaho, baby boomers – Americans born between 1946 and 1964 – are retiring at the rate of 52 a day. In a tight labor market, replacing these workers is not easy. Even when a replacement worker is found, the business has still lost an experiencedworker with deep institutional knowledge about the business — things like how a problem that just cropped up was solved 15 years ago, who’s the best contact at a supplier that isn’t providing what was promised, and other insights that contribute to a business’s competitiveness and bottom line.
For more than two decades, older Americans have opted to stay in the labor force longer, while younger Americans have reduced their labor force participation. Women are likely to continue working in their 60s. Since the start of the recession in December 2007, the share of older working women has grown while the percentage of every other category of U.S. worker – by gender and age – has declined or remained flat. In 1992, one in 12 American women worked past age 65. Now, around one in seven do. The U.S. Department of Labor projects that number grow to almost one in five by 2024.
Idaho also has seen large increases in labor force participation for senior workers — 62 percent for men and 129 percent for women — while other workers’ participation declined or remained flat.
In 1992, one in 18 Idaho women worked past age 65. Now, around one in seven do — the same ratio as the nation.
With baby boomers in their 50s and 60s swelling the ranks of older workers and their labor force participation on the rise, Idaho workers 55 and over grew by 161 percent, from 64,300 in December 1995 to 167,500 in December 2015, according to the Current Population Survey, the monthly survey conducted by the Census Bureau to track unemployment in the U.S. Over the same period, Idaho’s labor force 25 to 54 years of age doubled from 145,200 to 296,100.
A guiding principle of the wood and paper products industry is to reforest after harvesting – planting new trees for future generations. Now, as baby boomers retire, northern Idaho wood products manufacturers are applying that same principle to their workforce.
There are 240 wood products and paper manufacturing businesses employing 6,800 people in 40 of Idaho’s 44 counties. Using the statewide multiplier of 2.79 for all wood products and paper manufacturing subsectors, combined they create another 12,136 jobs in other sectors across the state. To further signify the industries’ role in Idaho’s overall economy, the annual average wage is $42,620 – 18 percent higher than the average wage for all industries.
Over half of Idaho’s wood and paper products jobs are in the 10 northern counties, and most of the rest – 36 percent – are in southwestern Idaho. Nearly one in three manufacturing jobs in Idaho’s 10 northern counties is in wood and paper products, making these regions highly dependent on the industry and its rolling multiplier effect.
Nonetheless, the industry has identified a void in its aging workforce.
Nearly half the workers are 45 or older, leaving mill managers mulling future workforce needs. One in four northern Idaho mill workers is set to retire in the next 10 years – 23.5 percent are 55 and older compared to 20.5 percent statewide. Another 31 percent are between ages 45 and 54 in the north compared to 26 percent statewide.
Log scalers and saw filers were becoming obsolete, and increased mechanization in the mills generated a need for industrial control technicians – electricians trained on program logic controllers, or PLCs. With that, a partnership was formed between North Idaho College, the Idaho Department of Labor and the three largest wood product manufacturers in northern Idaho – Idaho Forest Group, Potlatch and Stimson.
To meet industry needs – especially as the knowledge, skills and expertise of the baby boomers disappears with their retirements – the state’s Workforce Development Council approved a new Industry Sector Grant program. It uses Workforce Development Training Funds to assist Idaho employers in creating new jobs or retaining existing ones. The fund is financed with a 3 percent offset of employer unemployment insurance taxes. It reimburses employers for training costs for jobs that pay at least $12 per hour and include employer-assisted medical benefits.
As a result of collaborative efforts and the state’s Industry Sector Grant program, a Wood Products Manufacturing Center of Excellence was created at the college to focus on training logic controller technicians, or PLC electricians, saw filers and log scalers as part of the industry’s succession plan.
The wood products consortium received $374,000 to run training programs for these occupations over the next two years – $281,000 from the training fund and the rest in a match from the businesses. The center at the college’s Workforce Training Center has been operating since Jan. 1.
Other regions across the state could benefit from this pilot program as well. With 36 percent of the wood products and paper industry in southwestern Idaho, similar partnerships could apply a similar foundation to fill their employer needs.
The number of job openings in wood products and paper manufacturing is at 2007 levels. There were 712 job openings statewide in 2012 – 14 percent more than in 2007. In 2013, job openings slowed but still remained around 2007 levels with 600 jobs posted through the Idaho Department of Labor. Electricians, kiln operators, truck mechanics and skilled saw filers were among some of the good-paying jobs the industry needed to fill.
The output of Idaho’s wood products sector is likely to grow considerably in the next 10 years, and the need to replace an aging workforce is a growing concern. As the housing market continues to recover and housing starts normalize, mills across the state have leapt back into full production. Growing population and increased prosperities in China and other Asian countries increased those countries’ imports of Idaho wood products, which should continue. Declining competition from imported western Canadian wood products due to the risk of disease and pests is also expected to reduce timber harvests in British Columbia and Alberta. The U.S. Forest Service is willing to increase timber harvests on public lands, and the Clearwater Basin Collaborative and the Panhandle Forest Collaborative are expected to lead to more federal timber sales.
A bright future looms in the wood products industry. The center will train the next generation of workers in an industry that has always been the backbone of northern Idaho’s economy.
Alivia.Metts@labor.idaho.gov, regional economist
(208) 457-8789 ext. 348