HR Calculations: Average Retirement Age
Determining the average age that your workforce typically retires at can provide a useful tool for workforce planning purposes.
While every case is unique, analyzing the trends over time allows you to make assumptions to help with succession planning, hiring requirements, budgeting and operational factors.
1. Obtain the number of employees who retired in the previous 12 months.
2. Obtain the age of each employee.
3. Add up the ages to get a total number of years.
4. Divide the total number of years by the number of employees that retired to get the average age of retirement.
For example, the company has three employees. Employee A was 60 at retirement, employee B was 58, and employee C was 62. 60 + 58 + 62 = 180 total number of years. 180 (years) / 3 (employees) = average retirement age of 60 years.
Things to Consider
· In a larger company, compare retirement ages by department, facility or division. In a smaller company, be aware that individual factors can significantly skew the results.
· A poor economy can affect the numbers. Although employees may still want to retire, they may not
· Compare the average retirement age in your organization with other comparable employers in the same industry or geographic location.
· Repeat the process on an annual basis to watch retirement trends over time.