When an aging baby boomer hits retirement, he not only takes with him a full pension but years of institutional knowledge. The problem is exacerbated by a greater need for public services as the generation grows old, which leaves less money for benefits to attract young workers from the private sector.

Of the 3,800 employees in the Henrico County, Va., workforce, 38 percent are eligible for 2005 retirement. In the late 1990s, officials analyzed the pending crisis. “We looked around the room at the top 100 people that were here today and gone tomorrow and decided to come up with a program,” says George Cobble, Henrico's director of human resources.

First, officials merged data files from different departments to learn which employees were retiring and when. The county then conducted a major review of private companies to see how they were dealing with the pending brain drain. The private sector model, however, differed from the county's open competition model in that critical management positions often are replaced through a pre-selection process in which one to three people are trained to fill a void.

In 2001, Henrico decided the solution to its future workforce shortage would be to conduct management training from the top down. Courses are posted on a Web site, where staff may also complete registration. The success of the program is evident in the numbers — of the 16 positions vacated since the training began, 15 have been filled from within the county ranks. “When a long-term, high-caliber vice president leaves, we'll have people prepared and ready to compete for the position,” Cobble says.

Jason Seligman, a research economist for Athens, Ga.-based Carl Vinson Institute of Government, says that outright costs from losing institutional knowledge through retirement are difficult to tabulate given the fact that county government technology measures have traditionally lagged behind the private sector. However, the economist predicts that pensions and the demand for senior services will tap general funds at the same time. Because counties will have less money to pay for attractive benefits, they will have trouble attracting younger workers expecting compensation comparable to the private sector, he says.

Anaheim, Calif., is taking an aggressive approach to its aging workforce. More than half of its managers will retire by 2004, so city officials began a “Build the Bench” program to develop leaders. Part of Anaheim's aging dilemma can be attributed to a population spike in the 1970s and 1980s when the city became a resort destination. Now, the population that came to service the tourism industry is retiring.

To help develop future top-level managers, Anaheim is betting on higher-education programs. Human Resources Director David Hill says the city has been successful with a leadership scholarship program in which employees compete to attend a training program at any university in the United States. Upon completion, they are required to teach a class to city managers, and many have earned high-level jobs. “About two-thirds [of leadership program participants] have been successful in competing for higher positions in one of the top two levels,” Hill says.

Anaheim also brings bachelor's and master's degree programs on site to the city's 2,000-plus employees. The third leadership initiative is a partnership with Chapman University, which provides an accelerated master's degree and organizational leadership program to city employees. Launched in 2001, about 60 employees now graduate from the program annually.

While a handful of local governments are developing innovative strategies to deal with the baby boom bust, cities and counties might do well to hunker down against the onslaught of empty cubicles. On average, 23 percent of county workers nationwide are at least 55 years old. And many are packing up their fishing poles.