Introduction
The ageing of Australia’s workforce is one of the most important issues facing employers.
Demographic predictions have become reality and the next decade will require a broadened approach to the way we deal with population ageing.
Employers that can recruit and retain mature age workers will have an advantage in a period of low unemployment and increased competition for talented and experienced workers.
With fewer people entering the workforce and skills shortages deepening, it is important not to underestimate the potential of all workers. Many mature age people are keen to remain in, or even re-enter the workforce, if given the right opportunity.
Australians aged 45 and over face greater barriers to employment than younger workers, however, over the coming decade employers will be increasingly dependent on older workers to grow their workforce.
Grey Matters has been designed to assist your business in dealing with the challenges of an ageing workforce and planning your labour needs.
Older workers: myth versus reality
Mature age workers are a diverse group and many of the negative stereotypes are unfounded.
Mature age workers bring extensive work and life experience to their jobs. Far from being ‘past it’, many still have years of productive employment to offer.
It is important that business decisions are based on sound facts. Here are some key ones that all businesses should know.
Mature age workers tend to be more loyal and to stay with a company for longer.
With the high cost of recruitment and training it makes good sense to retain employees for longer to maintain corporate knowledge and pass on skills.
Studies have found that, in comparison to younger workers, mature age workers have:
- lower absenteeism
- fewer accidents per employee hour
- far better judgement and critical thinking abilities
- higher productivity.
People are living longer and maintaining their health for longer.
The average life expectancy for the current generation aged 45-65 is around 80 years for men and 85 years for women.
The ‘baby boomer’ generation have had a healthier lifestyle than their parents and are likely to maintain this into their later years. They are therefore also likely to retain a connection to the workforce for longer.
Mature age workers are willing to learn and to update their skills.
Workers of all age groups that are offered training opportunities are more likely to stay in employment and for a longer period of time.
Lifelong learning has become important for all age groups and it is increasingly necessary for all workers to continue learning well past middle age.
Today’s mature age workers have already had to adapt to multiple changes in the way we work and will continue to do so until they retire.
People over 50 are the fastest growing users of information technology.
We all need to continually update our IT skills and mature age workers are willing to take courses and improve their skills in order to keep up with changes in technology.
It is a lot easier to update IT skills than to replace the wealth of knowledge built up over a lifetime in the workforce.
Verbal skills, communication and intelligence remain much the same as a person ages.
Mature age workers have many productive years ahead of them, but often it can be useful to reconsider the type of work they do in order to make the best use of their skills and experience. For instance, those who have been in traditionally physically demanding occupations can take on new roles, such as training and mentoring.
Workforce participation facts for Australia’s ageing workforce
Workforce participation has risen steadily, particularly for the 55-64 year old age group (although at rates lower than other OECD countries).
Notably, women are participating in the workforce for longer and in greater numbers than ever before, and this is expected to increase to just below that of men.
Mature age workers are well qualified, with overall levels of educational attainment increasing, particularly among women. This will improve workforce participation and can be further enhanced by providing skills development to existing groups of older workers.
Quick facts
- The Australian population’s median age in 2010 was 36.9 years, up from 32.1 years in 1990, and this is expected to continue to rise.
- The Australian workforce aged over 45 in 2010 reached 31% and those under 25 fell to 17%.
- By 2050, nearly one-quarter of Australia’s population will be aged 65 and over, compared to 13% today.
- By 2050, there will be only 2.7 people of working age for every person 65 and over, compared to 5 people of working age today for every person 65 and over.
- Today’s older workers intend to retire later, at around 64 years for men and 62 years for women, compared to 58 years for men and 47 years for women in 2007.
- The Intergenerational Report predicts that increasing the participation of mature age workers by 5% in the next 40 years would increase Australia’s real GDP per capita by 2.4%.
Recruiting older workers
Age discrimination, even inadvertent, affects the ability of many mature age workers to remain in the workforce.
Terms such as ‘energetic’, ‘fit’, ‘dynamic’ and ‘fast-paced’ are directed at younger job applicants, while ‘mature’, ‘experienced’, ‘knowledge’ and ‘expertise’ are expected to appeal to older job candidates.
Rather than using age-directed language in advertisements, best practice suggests that recruiters advertise for ‘demonstrated capacity to…’ or ‘proven track record in...’ as these phrases reflect the skills and abilities required, rather than the age of applicants.
Actively encouraging interest from people of all ages will broaden the range of applications you receive.
Simple and practical things to keep in mind to ensure that you are improving your chances of recruiting skilled mature age workers:
- Make sure your workplace culture is ‘age-diversity’ friendly and ensure that recruitment is based on merit.
- Focus on the skills needed to do the job. Value the transferrable and life skills that mature age workers possess.
- Don’t ask for age on application forms so that it does not become the focus of your search.
- When interviewing, don’t include questions that focus on age, such as asking candidates about their schooling. Include a range of age groups in the interview panel.
- Don’t make assumptions based on age, for example, don’t assume someone is ready for retirement or not interested in promotion, and don’t assume they want more responsibilities either, talk to the employee about their plans.
- Consider that many mature age workers have not frequently changed jobs and have less experience with the recruitment process than younger workers.
Recruitment activities that encourage mature age candidates to apply, and that can remove barriers that may impede them from being shortlisted, include:
- Use of language and images in recruitment materials that imply a mature age candidate would be considered for the position.
- Make sure recruitment companies are aware that you are willing to consider mature age workers. Encourage them to send you candidates in this age group.
- Use specific job placement websites aimed at mature age workers or look at listing vacancies in non-web locations, such as local newspapers.
Retaining older workers
The money you spend on recruiting and training staff pays off over time. The longer you keep staff, the greater the return on your investment.
Probably the most important factor in retaining mature age workers is flexibility.
Some may have returned to the workforce following a period of retrenchment, child rearing responsibilities or early retirement.
Others are looking to change roles or looking for a new challenge, and others are looking to transition from full time to part time employment.
Flexible hours and work practices
- Work hours: varying working hours on a one-off, short-term or long-term basis, being able to start or finish work at varying times, compressed work days and rostered time off.
- Job share: communication is the key to successful job sharing. This includes between employees and with the wider organisation so that the job is done efficiently and effectively. Having a period of overlap enables workers to hand over important information.
- Telecommute/ work from home: some work is particularly suited to this practice, for example, detailed work requiring intense concentration. Technology has made it possible to remain connected via email and telephone and reduced the need for travel.
Supportive workplace cultures
- Job redesign: workers who have been in a role for a long period may need to change their role to avoid ‘burn out’ or ‘physical illness’.
- Shift work and rotation: encourages employees to learn new skills and keep up current skills, allows more flexibility in covering leave and skills gaps.
- Leave provision: part-year leave, personal/carer’s leave, taking leave in shorter periods more often.
- Consider OHS issues: workers returning from a break or changing the type of job they do need to be made aware of OHS issues specific to the job, some tasks may have to be modified to ensure they are suitable for mature age workers.
Opportunities to mentor
- Phased retirement: approaching retirement as a transitional phase means that skills and corporate knowledge can be passed on and workers can stay employed for longer.
- Employment Assistance Fund: The Australian Government provides support to employers that recruit mature age workers with health, injury or disability in order to help with redeployment. They offer financial assistance for training, modification of equipment and assistance with job redesign to enable workers to retain their jobs.
Retraining older workers
Mature age workers, like their younger counterparts, need opportunities to improve their skills.
Studies show that employees of all ages are more likely to stay in their current employment if they are given training opportunities tailored to their needs in delivery and focus.
Mature age workers are under-represented in both formal and informal training – both are strongly linked to improved productivity, retention and recruitment.
A study by the National Centre for Vocational Education Research found that qualifications attained later in life have as good, and sometimes better, pay-off in employment for older workers than those obtained at a younger age. A higher level of skills can somewhat offset the effect of age on workforce participation.
It makes good sense to offer training to all employees in order to utilise the potential of all employees.
Successful training takes into consideration a person’s background and is adapted to suit their needs.
Unlike younger workers, mature age workers have an extensive range of transferrable skills and experience that can be built on during a training program, and as such training should be customised to their individual needs.
Mature age workers are more likely to use auditory, left-brained learning, that is, a logical, analytical approach (the old chalk and talk model).
Younger people are more likely to be visual, interactive or collaborative learners because of the changes in the style of teaching currently favoured by schools.
Mature age workers are more self-directed in their learning.
They respond well to e-learning opportunities as the delivery is more flexible and can be easily tailored to provide specific skills and can be accessed remotely at any time. It can also be used to reduce the time taken to achieve the qualification as students may be able to work at their own pace.
Experience+ Program available to employers
The Department of Education Employment and Workplace Relations, through its Experience+ Program, provides financial assistance to business to retrain mature age workers (55 plus) to supervise or mentor apprentices or trainees.
Assistance is also available to Small Business owners who are over 55 and have trainees or apprentices working for them.
Managing retirement
Compulsory retirement ages are no longer acceptable or legal in most jobs. People can now choose how long they remain in the workforce.
A sudden change from full-time employment to retirement can be a problem for both employers and employees. Flexibility and planning are key to a successful transition to retirement.
When considering employees’ retirement, have you:
- Asked older workers about their retirement plans?
- Set up mentoring schemes where older workers coach younger employees?
- Considered flexible retirement options; for example, part-time work, job sharing, stepping back to a position with less responsibility, home-based work, contract work, or inviting retired workers back to work on a casual basis?
You can benefit your business and show your commitment to deal fairly with employees by using the following approaches to retirement:
- base retirement policy on business needs
- giving individuals as much choice as possible
- evaluating the loss to the organisation of skills and abilities and planning how you will replace these
- using flexible retirement schemes
- making pre-retirement support available.
Pre-retirement support
Employers can help employees prepare for retirement by offering:
- retirement planning workshops
- financial planning advice.
Early retirement
Early retirement schemes have been used in the past as a means of managing reductions in the size of the workforce. They can be attractive both to employers and employees.
Employers now need to think through the consequences of such schemes to ensure that key skills, knowledge and corporate memory are not lost.
Flexible retirement
Flexible or phased retirement options can help businesses to prepare for the loss of an employee’s skill. It also allows employees to alter the balance of their working and personal lives and prepare for full retirement.
Example:
Allow employees to choose the date on which they take their full retirement; use gradual retirement, in which the transition from full-time work to retirement is made through a period of part-time working.
For employers, gradual retirement could be a means to retain the knowledge and experience of older workers so it can be passed on to younger workers.
For employees, gradual retirement could be a useful way of preparing to cope with the difference between working full-time and full retirement.