ParentCare » Vol. 1

The Graying Workforce: Anything But Retiring

New perspectives will be needed on both sides of the desk in the workplace of the future
By Christina P. O’Neill

It’s the elephant in the room: the aging of the workforce. Over a generation, the notion of employment has changed. Years ago, the ideal was a lifelong career in one company or industry followed by a pension. Today, the workplace is in constant flux through outsourcing, turnover, and the hiring of temporary workers. Uncertain financial futures will create challenges and pressures on many older people who want to remain in the workforce or rejoin it. The response to the optimistic mantra of possibilities ~ “Reinvent yourself” ~ may increasingly become “Into what?”

Those who see the glass as half full say older workers have the advantage of experience, wisdom, stability and institutional memory. Those who see the glass as half empty point to the difficulties of finding or keeping a job once one gets past midlife, never mind once one hits the Medicare years. Older workers and employers need to meet in the middle on some key concepts ~ older workers need to embrace retraining and employers need to get rid of the notion that the only worker worth investing in is a young worker.

One thing is for certain: more older people are seeking a place in the job market because they have to work in order to make ends meet. A 2006 study of the cost of living in MA for elders bore that out. Analyzing data county by county, it found that even elders who owned their homes free and clear are vulnerable to cash-flow problems.

“We have to get rid of the idea that the only workers worth investing in are younger people. That’s just not true.”
– Donna Wagner, PhD

Donna Wagner, PhD is Director of Gerontology at Towson University in Maryland. She says the stereotype of older people joining the labor force just to fill their free time is due for a major makeover. More and more, she says, older people will join the labor force ~ or stay in it ~ because they have to.
Longer lifespans, shrinking pensions and rising living costs will lead to an increase in the number of people who, without continued gainful employment, won’t have enough money on which to live. “I think in the future, we’ll see people whose primary motivations are economic, more so than anything else. It’s not just the quality of life, it’s really an economic necessity.”

Not your father’s workforce

Meanwhile, employers don’t seem to be planning for the changes to be brought about by an aging workforce, nor anticipating its benefits. Wagner cites a national survey on employers she conducted for a report finished in 2000 in which few of them said they’d addressed the issue of older workers. Little has changed since then, she says.

Employers might
want to start thinking about different kinds of benefits that would allow people to keep working longer, retaining the value of workers who have made contributions to their workplace (and saving on replacement costs), and the institutional memory that goes along with it, she says. What are those? “Every survey on older workers has suggested that the one big thing that’s really key for older workers is the flexibility. So building that flexibility into a workplace is a good key retention strategy.”

Job flexibility relates to where a person is in their life cycle. Many middle-aged (and older) workers have caregiver roles with a parent, spouse or adult child. They may have to move in and out of the workforce as the demands of their caregiving role change. Allowing them the flexibility to do so without losing their jobs is a good retention strategy, Wagner says.

Investment needed in workers of all ages

One workplace myth that she’d like to see disappear is that training is an investment to make in the young workforce. “Employers still have this old-fashioned idea of investment in human capital: if you invest in them when you first get them, and they’re young workers, they’ll stay with you forever.” Not true, Wagner says. “They’re going to change their jobs every five years or so. But if you make a good investment in a senior, an older person, they could be with you for a decade or more. We have to get rid of the idea that the only workers worth investing in are younger people. That’s just not true”

People of all ages need to keep up to date with their skills, not just young workers, she says. “You can teach old dogs new tricks…A lot of older workers are really keen on doing that.”

­Then, there’s the stability factor. Wagner recalls one respondent to her workforce survey who said to her, in essence, that he didn’t want to hear about employees’ dates, relationships or divorces. “When you get an older worker, you get someone whose life is generally settled. They show up, they’re there to get the job done; it’s not a big drama every five minutes,” she says.

Older worker retraining ~ a wave of the future

Job-hunting advice columns are full of respondents in their 50s and even 40s who are having a hard time getting hired. Overall, it’s harder to get a job at age 55 than at age 35, regardless of federal age discrimination law. But most people aren’t ready to retire at 55. Wagner cites the need for specialized employment services to help displaced midlife workers. Two different groups arise: the displaced professional worker and the older worker who has never had a high-paying job. Both of them may be struggling to make ends meet, but each of them needs different training.

The stereotype about older workers possessing out-of-date skills is somewhat true, Wagner admits. It’s particularly a problem for employers who want office support staff. “They would love to hire older people,” she says, “but there’s no guarantee that they’re going to show up on the job knowing how to do everything in the new Vista environment or [in] Excel, for example.”
This reinforces the notion that the employment services needed by an older worker are often different than those needed by a younger worker, Wagner says. “I have seen some progress in that but I think we have a long way to go. It will be a niche job opportunity of the future ~ mentoring and training for older people.”

Some federally-funded programs take on older workers and place them in subsidized employment with training, but these are mostly workers who had a hard time competing in the job market when they were younger ~ or who held jobs in an industry sector that does not pay well.

These long-standing federally funded programs serve older, income-eligible workers by providing them training and subsidized employment. The workers in these programs are not representative of all older workers, however, and may have had a lifetime of low-paying positions. It is not uncommon to see people in these programs who have spent their entire careers in those helping professions that offer high levels of satisfaction and low levels of pay. In late life they may need to turn to the subsidized programs because they cannot make ends meet. “That’s one of the long term effects of working in the low-paying sectors of the human service industry that you don’t always think about,” says Wagner. “Becoming a client of programs that you helped manage over your work life has to be one of life’s great ironies.”

What color is your parachute if it isn’t gold?

All this being said, employers need older workers more than they may be willing to admit. Replacement and recruitment costs are high. A March 2007 report in Trendwatchers, a publication of the Institute for Corporate productivity, cited a U.S. Department of Labor estimate that the average worker replacement cost this year is $13,996. Other estimates range from about 29 percent of an employee’s annual salary to several times that yearly salary.

Employers need to learn to look at a stable workforce as an asset that doesn’t cost time and money just to keep the seats warm. They need to balance the cost savings of stability against some other assertions about older workers ~ excess absenteeism due to illness, and higher health care costs than those of younger workers ~ which may not be borne out in real-life experience.

The concern expressed on job-hunting boards about the ability to find work past a certain age is all too common. It points to the need for older workers to change the way they look for work. Critical to their success will be retraining, but they’ll have to study the marketplace carefully ~ or hire a job coach who has done so ~ in order not to waste their money on training that isn’t marketable. Education is another factor; if even young people face challenges in capitalizing on their education and paying off school debt, older people face more daunting circumstances. Older workers shouldn’t go it alone in the reinvention game.

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