With an ageing UK population there is an inevitability about the changing demographic of the labour market. Legislative changes, economic factors and increased life expectancy unavoidably combine to create a challenge for employers in terms of how they adapt and provide for an ageing workforce.
The Office for National Statistics (ONS) predicts that people aged 50 and over will make up almost a third of the working age population within the next five years. The average age of retirement is increasing with older workers planning to stay longer, meaning less space in the employment market for younger generations.
The Employment Equality (Age) Regulations 2006 provided a default retirement age which enabled employers to enforce retirement on those reaching 65 without risk of discrimination claims. The Equality Act 2010 however abolished the default retirement age along with the associated retirement procedures meaning employers can no longer issue retirement notices to employees who reach 65. At the same time greater life expectancy and an increasing state pension age unsurprisingly mean that people are choosing to work longer to maintain their living standards; in some cases it is a necessity.
The challenge for employers is ensuring they do not fall foul of age discrimination legislation and ensuring negative stereotypes are eliminated from the workplace. There is no evidence to suggest that on the whole older workers are more expensive, slower, less motivated or resistant to change as many misconceptions suggest. In fact, despite there being a general decrease in the participation of training for workers who reach their mid-50s, many older workers are more than happy to enter a training program if it will assist in extending their working life.
It is fair to say older workers are more likely to have long term health issues and, whilst it is widely believed that working is good for the mental and physical wellbeing of individuals, employers would do well to put in place wellbeing strategies that can significantly reduce sickness absence.
Whilst these challenges exist for employers, embracing the opportunities that retaining older workers can bring to their organisation can have a hugely positive impact. They can be a valuable asset by setting an example to younger generations of experience, skills, loyalty, work ethic and reliability; and their knowledge of the company history cannot be replicated in a younger model! Encouraging workers to delay their retirement is also a way of preventing a skills gap and reducing the need to recruit. If a company does need to hire, there is a wealth of experience in the older workforce ready and waiting to be put to good use.
Managing your human capital resources by having an ongoing workplace planning strategy in place will help with closing skills gaps and meeting future workplace needs. As an employer, or HR professional, it is important that you understand the age profile of your workplace and the value of the skills and knowledge your employees contribute, no matter what their age.
This article first appeared in the April edition of inbusiness magazine inbusinessessex.co.uk