Addressing Workforce Aging Challenges at Biogen
Biogen is strategizing to address the aging demographic in its workforce by adapting its employment policies and compensation packages. The company observes an increase in older employees while still maintaining a younger profile compared to the broader U.S. population. Initiatives include enhancing benefits, introducing flexibility in plans, and providing resources for health, financial well-being, and work-life balance tailored to the diverse workforce's needs.
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National Bureau on Economic Research: Aging Workforce Speaker Briefing Ginger Gregory October 2019 1 Biogen | Confidential and Proprietary
Event & Panel Objectives Various employer representatives to respond to series of bureau presentations by discussing the age structure of employees for their business, the extent of aging of their workers, and any changes they are seeing in the retirement age. We are hoping that each HR executive will then describe any changes in employment policies and/or compensation policies they are implementing or considering in response to these trends. Ginger to be the first responder in the third session, which begins with a presentation by Kenneth Zawodny, Associate Director of Retirement Services, US Office of Personnel Management and Mark Reinhold, Associate Director of Employee Services, US Office of Personnel Management. They will be describing how the federal government is responding to the aging of its workforce. Ginger to discuss if there are any lessons from the policies of the government that might be useful for Biogen and other large employers. Opening remarks could include whether aging is seen as a current or emerging issue for Biogen and if so, how it is responding to these changes. Presentation should last approximately 10 minutes and does not need slides. This will leave about 30 minutes for general discussion. 2 Biogen | Confidential and Proprietary
The aging of our employees is creating a more demographically diverse workforce 70 U.S. Employees by Age Over the past seven years, the percentage of Biogen s U.S workforce over age 45 increased from 29% to 38% When OUS employees are factored in, the percentage over 45 increases only slightly to 40% 60 50 40 At the same time, the largest segment, age 30-45, dropped from nearly two-thirds of our workforce to just over half 30 20 10 While Biogen s U.S. workforce is aging, it s still younger than broader U.S. population workforce which has 55% over age 45* 0 20-29 30-45 46-55 56+ 2012 2019 *2018 US Census Bureau Population Report. 3 Biogen | Confidential and Proprietary
Age-diverse workforce challenges us to continuously evaluate and update programs to ensure our Total Rewards investment is optimized Examples of changes we ve introduced: Historically, benefits have been relatively uniform and heavily family-oriented to align with large age 30 to 45 cohort Comprehensive health and life insurance benefits Wellness programs emphasizing preventive care, healthy pregnancy Competitive maternity and parental leave, onsite and back-up childcare As population ages, we ve introduced more choice and flexibility in benefit plan offerings, and expanded education and resources to address the health, financial and work/life balance needs of our diverse workforce A medical plan with tax-effective health savings account to which Biogen contributes $500/$1,000,to enable tax- effective saving for healthcare now and in the future (e.g., retirement) o o Wellness programs to address risks of aging workers (e.g., diabetes prevention through OMADA, promotion of relevant screenings like mammography and colonoscopy) o o o More supplemental life insurance options for employees and family members o A Roth after-tax savings feature in the 401(k) plan o Free financial advisory service and a wider range of financial education opportunities , including workshops and seminars on topics relevant to those nearing retirement o Work/life balance supports for older workers, such as college and elder care advisory services, and back-up elder care o 4 Biogen | Confidential and Proprietary
Aging workforce: future considerations Potential Opportunities: As our population continues to age, we anticipate redoubling efforts to: o help employees financially prepare for retirement o identify new levers to help us optimize workforce management efforts We will complete our Total Rewards Optimization survey of all employees globally later this year o results will help us understand pay and benefit preferences by various demographic cohorts and enable informed decision- making about potential change Financial Preparation Workforce Optimization Promote maximization of generous 401(k) match and catch up contribution, and utilization of modeling tools and other financial resources Promote flexible hours and schedules. job share, part time and modified role to retain talent and improve succession and continuity planning Increase education on Social Security, Medicare, tax and estate planning, and other topics relevant to pre-retirees. Offer phased transition to retirement by allowing gradually reduced work schedule (e.g., 30 hours at age 62, 20 at 63, 10 at 64.) Provide paid leave for elder caregiving to retain older workers who otherwise may retire due to caregiving responsibilities Assist with employees financial transition to retirement by providing information on purchasing an annuity, and update our plan to provide more flexible 401(k) distribution options Support employees in understanding health care needs in retirement and support them in assessing options and obtaining coverage Provide financial support and time- off for older workers to engage in learning and development opportunities to update skills and knowledge Allow longer service employees who accrue vacation at higher rates, to bank a limited amount of unused vacation each year and receive lump sum payout at retirement to ease transition (like statutory severance in some OUS locations) Make benefits comprehensive and affordable for PT employees to support phased transition approach 5 Biogen | Confidential and Proprietary
Optimizing Biogens multigenerational workforce There are multiple practices and approaches that are effective in creating a more powerful multigenerational workforce. Understand what workers truly want. Too often employers guess at what workers want without speaking with them to understand what they want most. 1996 and After (Gen Z) <1% Provide flexibility. There is not a one-size-fits-all solution for each generation or all employees. Employers need to understand what employees want and be flexible in providing it. This includes flexible hours and work arrangements, locations, benefits, projects, and more. 1977 - 1995 (Millennials) 46.8% Offer opportunities for continuous learning and knowledge transfer. The greatest fear for employees is becoming obsolete. The solution is continuous learning. Focus on recruiting older workers. Older workers often have rare, valuable skills that can provide significant business value. Include age as part of the D&I strategy and create mixed-age teams as a dimension of diversity. 1965 - 1976 (Gen X) 40.3% Benefits to a workplace culture which involve an aging workforce: Engagement and grit levels increase with age o Experienced workers can help fill the talent gap o 1946 - 1964 (Baby Boomers) 12.5% Work quality improves with age o Mature workers are shown to display stronger relationship skills and organizational citizenship behaviors o Older workers can help companies gain older customers o 0 10 20 30 40 50 6 Biogen | Confidential and Proprietary
