Sunday, July 30, 2006

Logically, Top Executives should be getting older.

There have been forces at the bottom and top of the age issue forcing change. Through the second world war, few companies hired college graduates. The G.I. Bill was responsible for the huge expansion in college degrees, even when Ford Motor Company hired Robert McNamara in 1946, he was not only the first MBA there, but one of the first college graduates. College graduates went on to law, education, or medicine in those days. Most executives started after high school (and a high school diploma was rarer than a college degree is now), at 18. So in 1925, by the time they reached 50, they had 32 years experience, but in 1960, it was down to 28, and with the expansion in MBAs in the 70s and 80s, it is now down to 24. On the other end, in just a few generations, health has grown not only life-spans, but the age at which you are healthy. In 1900, 13 percent of people who were 65 could expect to see 85, now it is almost 50 percent. in 1900, 28 % of white men between 50 and 64 had a heart murmur, now it is under 2%. Even since 1950, life expectancy for 20 year olds (to eliminate infant mortality) has climbed from 70 to almost 80. In each generation, not only has longevity increased, but so has it's health. This means that while someone starting work in 1945, would be an old man by 65, anyone starting work in 1970, would not reach that same level until well over 70, and as to those starting on 1995 - who knows? So logically, the age of business executives should keep on rising, as the age at entry keeps on doing the same.

Since in 1925, 75% of all executives were over 48, then today, they should be over 58. Yet, they are in fact, not. This means that business is filling an expanding need for executives from a shrinking pool.

No comments: