A glacier may be slow-moving, but it's powerful when it arrives.
Now a glacially moving event is about to hit the auto industry. It's the 30-and-out phenomenon.
Within five years, more than one-third of all hourly automotive workers - some experts estimate 41 percent - will be eligible to retire from the major automakers.
Demographic data show that Ford Motor Co., General Motors and DaimlerChrysler could see a combined total of 250,000 retirements over the eight-year period from 1995-2003.
Retirement rates within the supplier community likely will echo those of the automakers, albeit at a smaller scale.
'This is a mega-story that's been under the surface for some time,' says David Cole, head of the University of Michigan's Office for the Study of Automotive Transportation. 'I don't think we have the full dimension of how this is going to unfold and what the implications are.'
Auto executives stress that not every eligible worker will retire. Hourly workers are not required to retire after a 30-year period of service. Many continue working to fund the extras they desire, from vacation cottages to college educations for their children.
But a huge work force with an instant-retirement option is brittle. Plant closings, labor disputes and industry downturns can push a sudden decision to take the retirement and leave the hassle behind.
In addition, the distribution of the most senior workers is uneven. Layoffs and plant shutdowns in the 1980s and 1990s tended to concentrate large numbers of workers with high seniority in individual factories. As an example, a UAW Local 600 official said that in one Ford warehouse in Brownstown Township, Mich., more than half the hourly employees could retire now if they wanted to do so.
'There's going to be a retirement bubble,' Cole said.
The auto industry has been less attractive to workers with hot skills, Cole said. 'You are not going to instantly educate 250,000 people to fill all those needs.'
Automakers agree that there is a retirement bubble and that they may face interesting times. The huge changeover also will create new challenges for unions, particularly the UAW.
Senior workers who reaped the benefits gained by organized labor in the 1950s and 1960s soon will depart. They will be replaced by workers who may have less loyalty to the national union and less faith in collective bargaining.
University of Michigan studies estimate that the UAW will see half its membership change over the next five years, with an influx of younger and better-educated workers.
UAW officials did not respond to requests for interviews.
A GM executive, speaking on condition that he not be named, noted that the automaker had hired tens of thousands of workers every year in the 1970s as the company payroll grew to more than 500,000 employees.
In 1998, by contrast, GM hired only 500. The company's annual attrition rate stands at 6 to 7 percent. Not including former GM workers at Delphi Automotive Systems Corp., GM today employs 148,000 hourly workers and continues to glide toward a total employment goal well under that figure.
That means the potential effect of any retirement bubble could be amplified when it happens. Some 32,000 GM workers already are eligible to retire; the average worker already has 23 years of GM service and is 48 years old.
'We don't look to be doing a lot of hiring in the near term,' said one company spokesman.
However, Cole said GM's size and position in the downsizing movement for automakers may dictate a period of intense hiring for the company in about five years.
'This is not something that will solve itself in about a year or two. It will get worse. When it's really going to get tough is when you have GM into replacement (of retiring workers),' he said.
Although Ford and the former Chrysler also have a graying work force, they've already begun to hire younger workers. Both companies downsized in the late 1970s and early 1980s, when the slumping economy rocked the industry.
Now they're expanding again. The average age of Ford's 101,000 hourly employees is 44, while the typical unskilled worker at DaimlerChrysler Corp. - which does not include Mercedes - is 43.
According to Ford spokesman Ed Miller, one-quarter of Ford's hourly employees are eligible to retire. By 2004, almost 36 percent of Ford's hourly workers will be eligible to retire.
However, 'they won't all retire, and we don't expect them to,' Miller said.
DaimlerChrysler has a similar profile, said Bill Beebe, senior manager for Human Resource Services. The company employs some 70,000 hourly workers. Beebe said 22,600 workers will become eligible to retire over the next five years, but the company predicts fewer than 16,000 will do so.
A question of skills
The difficulty, he says, is that the new workers who will be hired at auto companies must be better trained than currently retiring workers were.
'In the classes of the 1960s and 1970s, most of your manufacturers didn't focus on such things as communication skills, problem-solving skills, matrix blueprint reading, deductive skills. These things now are as important as the basic cognitive skills,' Beebe said.
However, the high-tech educational community is not geared toward turning out technical workers. Moreover, college graduates generally deplore the idea of a factory job.
'We have a lot of people who have high levels of education but are basically unemployable,' Cole said. 'In many cases, they have a stereotypical picture of the automotive factory as a very dark, dangerous and dirty place.'
Within the auto industry itself, the demographic shift has magnified the importance of the human resources department. Formerly a necessary evil that managed routine tasks such as tax forms, pensions and worker discipline, human resources is assuming a strategic role for corporate planning.
'In the old days, if they had a budget cut and had to take money out, well, let's eliminate training,' Cole said. 'To even think about doing that today is ludicrous. You can't do that. It's a killer.'