With some hefty new contracts to provide spare parts to the U.S. government in place, CPI Aerostructures was in need of skilled mechanics. But when CEO Edward J. Fred placed an ad in the local paper, he noticed something unusual: In addition to the usual crop of eager, inexperienced youngsters looking to start their careers, the $24 million Edgewood, N.Y., manufacturer was flooded with inquiries from retired mechanics, many of them well past the age of 65. "These were people who had spent their entire lives making planes," Fred says. "And some wanted to work just three or four days a week."

And so Fred was faced with a decision: hire younger workers who would require training and supervision but who would eventually become productive full-timers with the potential to remain at the company for the long haul, or turn to older veterans who were already up to speed but would work fewer hours and probably have shorter careers at the company. As it happened, Fred hired four men -- two full-time, two part-time, and all over the age of 65. "We had to ask ourselves who would best help us with as few growing pains as possible," he says. Sure, managing his elders poses some difficulties. But the upside, he says, is considerable: "What we lose in time off, we make up for in the knowledge that their work is done right and on time."

With a soft economy that has depleted retirement funds and with people living longer, healthier lives, more Americans are opting to remain in the work force long past retirement age. And as Fred recently learned, that represents an unusual opportunity for business owners looking for experienced, reliable employees. In fact, pretty soon hiring older workers will be less of an option and more of a necessity. Between 2000 and 2010, the number of Americans between the ages of 55 and 64 will jump 47.2%, compared with a scant 2.8% increase among those aged 25 to 34, according to the Bureau of Labor Statistics. And those 35- to 45-year-olds who probably account for the bulk of your top management talent? Their numbers will actually drop 13.7%. Factor in the looming insolvency of Social Security and Medicare, not to mention less-than-robust 401(k) plans, and the bottom line is clear: The U.S. work force is getting a lot grayer.

That doesn't bother Jeff Baker, the 50-year-old CEO of Poorman-Douglas, a Beaverton, Oreg., company that handles administrative work for courts and has revenue of $40 million. He's been recruiting older workers for years. Today, approximately 10% of his 279 employees are over 60 -- including his three top salespeople, who outperform their younger colleagues by as much as 37%. "We sell professional services and customers need to have faith in the sales and marketing people," says Baker. "Having a little gray in your hair is an advantage." Case in point: Poorman- Douglas just won a major contract to process the administrative paperwork for the United Airlines bankruptcy case -- a deal engineered by two of his older salespeople. "I think their breadth of knowledge made a big difference in getting that job," Baker says.

Baker is also fond of hiring older people for some of the firm's less senior positions. Retaining a receptionist, he notes, had been a perennial problem because younger workers tended to take the job with an eye toward moving up in the company. Finally, he hired a woman in her mid-50s. She's been with the company for 10 years. Says Baker: "It was exactly the job she wanted."

To be sure, managing a multigenerational work place can be challenging, requiring heightened sensitivity to employees' individual needs and workstyles. "Occasionally, an older worker will be looking for a little more respect simply because of the years put in," Baker says. At the same time, he adds, "younger workers may feel stymied because there's somebody older and established in a position above them." So Baker takes care to spread the opportunities equally. "You need to think about what people want in terms of being fulfilled."

In addition, hiring experienced workers can be more expensive. Consider health care costs: A 2001 report on older workers by the General Accounting Office found that 17% of people between the ages of 55 and 64 have a "work-limiting health problem," compared with 9% of those aged 40 to 54, and 5% of people aged 30 to 39. Numbers like that can add up to higher premiums from health insurers. And salaries for older workers tend to be higher as well. At CPI Aerostructures, for example, older aircraft mechanics earn about 20% more than their less experienced counterparts, Fred says. But he believes the premium more than pays for itself because the more experienced workers serve as teachers to their younger colleagues, which has slashed the company's training costs. "If I had spent money to get them trained," Fred says, "we wouldn't have received the same dollar benefit."

But Fred says his older employees provide CPI Aerostructures with far more than just skilled labor -- a workplace culture that harkens back to the golden age of aircraft manufacturing. "Years ago," he says, "Long Island's culture was all Grumman and Fairchild. Having these gentlemen here has brought some of that old-time feeling back into our shop." Since bringing on his older mechanics three years ago, he's noticed that his younger workers seem more willing to work overtime and appear to take greater pride in their work. Says Fred: "I attribute that directly to the fact that the retirees have instilled a new work ethic in them."