Chapter 5 explores these issues from the perspective of employers.
Chapter 5: Employers' perspectives on the opportunities and challenges associated with older workers
Twenty-one individuals representing employers participated in the study. Eleven employers took part in focus groups, each of which had between two and four participants. Ten individuals representing employers took part in telephone interviews. This chapter presents key findings from the employer sample group and highlights good practice in managing an older workforce.
5.1 Opportunities and challenges presented by the employment of older people
Across the whole sample, it was evident that employers have started to engage with the implications of an ageing population for their workforce planning. This section outlines the main opportunities and challenges Scottish employers reported in relation to older workers.
5.1.1 Opportunities offered to employers by extending working lives
Older people bring valuable skills and experiences to the workplace. Employers participating in the study viewed the skills and experiences brought by the older workers to the workforce as the main opportunity offered by extending working lives. Both content-specific (e.g. manufacturing techniques) and more generic, 'life-skills', such as empathy, of older workers were praised.
Older workers help to retain 'corporate memory'. A number of organisations were acting on this opportunity by introducing mentoring schemes to pair older employees with new recruits in order to transfer skills and experiences. This approach was particularly evident in the health, manufacturing and hospitality sectors.
While most employers raised these opportunities, few reported the existence of organisational policies or practices explicitly tailored to an older workforce (see Section 5.2 below). Those employers that did mention policies for older workers tended to focus more on retaining existing older employees than recruiting new workers aged over 50. However, there were indications that employers in Scotland were starting to think beyond retention to also assess the opportunities for recruitment:
"I'd start with the premise that it [the ageing population] is actually an opportunity rather than a problem. I think: start with an assumption that is about providing new opportunities for older people rather than assuming that it is about holding them longer in what they were doing in their working lives." (Oil and Gas Industry, 4500 employees in Scotland)
5.1.2 Challenges identified by employers of extending working lives
Despite their overall appreciation of older workers, the employers in the sample identified a clear range of challenges as follows:
Increased likelihood of health problems amongst older workers. The main challenge identified by employers was increased absence from work due to health problems amongst the over-50s workforce. However, it was notable that only a minority of employers interviewed had actually measured this within their own organisations.
Health problems were considered to particularly affect those employees undertaking manual jobs (e.g. portering, lifting), care jobs and unsocial shift work (e.g. in hospitality). Musculoskeletal problems were the main health issue manifested within these roles. However, there was little proactive planning around the potential health effects of extending working lives. Employers reported responding to health problems amongst older workers mainly in a reactive and often ad hoc way, for example by varying work allocation or reducing work hours.
Abolition of the default retirement age has made workforce planning increasingly difficult. Irrespective of organisation size or sector, employers found it challenging to plan without a fixed retirement age. In small organisations, however, individuals' retirement plans appeared to be easier to track because of informal conversations and the close-knit workforce.
Competing priorities for older workers' time and motivations. For several organisations, across a range of sectors, there was growing recognition that older people often had other demands upon their time - particularly those associated with caring responsibilities. This is illustrated by the following quote from a voluntary organisation:
"We are also competing with part-time paid opportunities and the fact that demographic group provide child care for their families in terms of young children. So, since the abolition of the NDR [Normal Date of Retirement] we have noticed a shift in practice and behaviours of this population that we are having to adopt and adapt too." (Voluntary Organisation)
Mismatch between the skillset employers are keen to retain in employment and the qualifications of older workers who continue to work. A further challenge to extending working lives mentioned by all employers was that they experienced an appetite for early retirement, with the strength of this being closely associated with the types of pension schemes in operation. In particular, they reported that demand for early retirement was higher among their more skilled employees as those were more likely to have better pension arrangements to enable an early exit. Nevertheless, despite employers being more inclined to invest time and money in retaining their more highly-skilled older workers, they were actually losing them and facing the reality of an older workforce concentrated towards the lower-level roles and jobs.
Older workers are more likely to be unfamiliar with new technologies. Several employers raised the issue of how unfamiliarity and lack of self-confidence negatively affected older workers' aptitude and motivations for learning and incorporating new technologies within their jobs. Some successful approaches to overcome these challenges are detailed in Section 5.2 below.
Potential divergence between organisation's workforce profile and targeted customer base. A final challenge identified was a concern about the appropriateness of an older workforce serving a younger customer marketplace. However, this affected only a minority of organisations interviewed, and even they recognised that a balanced age workforce could bring advantages:
"We have a disproportionately high number of young workers and one of the concerns I have is that we are an organisation trying to stay relevant to a contemporary consumer base, and that drives you to think about only young workers are the right people to have in your organisation, particularly in the commercial functions, and actually that might not be the answer for us, actually we might need to balance that with experience as well. So we have a slight dilemma there." Manufacturing (Food and Drink)
5.2 Good practice in managing an older workforce
It is important to note that none of the organisations represented in the sample had an informal age cut off for either retention or recruitment, and all were very conscious of ageism and discrimination. However, that awareness of potential ageism was frequently given as a reason why there were no specific policies for retaining existing older employees, for age-specific training, or for attracting new employees from the 50+ age range.
Against that caveat, this section outlines organisations' approaches to managing an older workforce, focusing specifically on workforce planning and highlighting the practices and processes which employers deemed to be effective in recruiting, retaining or re-training older workers.
5.2.1 Good Practice in Recruiting Older Workers
Concerns around breaching equalities legislation have resulted in little or no policy dedicated to recruiting older workforce. Employers highlighted the risks of being perceived as acting in a discriminatory manner if they actively introduced strategies to recruit older people. The following quotes provide insight into how this was expressed in strategic terms:
" Interviewer: Do you do anything in particular to attract older applicants at all?
Employer : No, not in that way. I think we would be going to market basically for, frankly, skills and experience and that will quite often put people within a band with their age. Depending on what you're looking for. The same as there's nothing consciously in our reports that says we're targeting one group versus another group or whatever." (Oil and Gas Industry)
"There's nothing specific in place but it would just be open to everyone of all ages." (National public body)
Age profiling as part of workforce planning is still in early stages. It was widely acknowledged that the inclusion of age in diversity and inclusion/equality practices was still in relative infancy, because age discrimination was outlawed only in 2006. As such employers stated that age had received less attention in comparison to other protected characteristics or workforce demographic factors, such as gender, parenthood and disability. Therefore, only a minority of employers had undertaken age profiling of their workforce and were linking that to succession planning.
Those few employers who had undertaken age profiling were now thinking about age management as a longer-term strategy, recognising the benefits of a more proactive approach:
"People don't age quickly you know. It does take a little bit of time, so somebody's in their late 40s now, it will take a few years before they get to their mid-50s so we've got a bit of time to do something about that." (Utilities company)
Tackling managerial bias in managing and recruiting older workers was being undertaken by a few organisations. In particular, a financial services employer and an IT organisation were offering unconscious bias training to managers in order to encourage a more open approach to training, career development and recruitment practices.
One of the employer focus groups discussed the merits of shifting managerial emphasis to older workers. They recognised that focussing managerial attention to younger workers has perhaps been detrimental to the older workforce.
"We were talking last week in the business about the challenge of managing millennials, because people's value systems are different and their motivations are very different, but actually I think the other challenge is how we manage people who are much older than us and who have had seniority, status, position, success, track record and education which is very different to our own." ( SME, Business Transformation)
Overall, the employer interviews and focus groups highlighted a significant barrier to more proactive age and workforce planning. There was widespread acknowledgement that retirement conversations no longer took place, either because of abolition of a default retirement age or because of a fear as being perceived of being ageist.
This contributed to a lack of information about employee intentions and plans around later working life, especially in larger organisations.
5.2.2 Good Practice in Retaining Older Workers
In contrast to recruitment, there was much more evidence of good practice in retaining older workers.
Flexible working policies were viewed as the most obvious way to retain and support existing older workers. The most common forms of flexible working were reduced hours and remote working.
Reduced hours were offered in the form of part-time work on an open-ended basis or as a mode of phased retirement. Remote working, i.e. working from home, was offered by a few employers but it was recognised that some jobs could not be undertaken away from a work site.
Flexible working appeared to be most commonly requested for caring responsibilities, either for grandchildren, elderly or sick partners and relatives or for personal desire to remain engaged in the workforce whilst still being 'able to enjoy retirement'. However, it was reported that older workers were less likely than their younger counterparts to make a formal request for flexible working (see Section 4.4.4 for a discussion of informally negotiated flexibility amongst the sample of older workers).
Both formal and informal flexible working were seen to be beneficial. Larger employers were more likely to have explicit flexible working policies in place. SMEs were more likely to use informal flexibility because of their close-knit relationship with individual employees and this agility was reported to be appreciated by their older workers. However, the limitations of an informal approach were also recognised, particularly in terms of planning:
"So that uncertainty is, I think, the biggest issue. Because SMEs don't workforce plan in the same way that corporates do because it's about scale - there's no need to do so. But clearly to lose a key member of staff that you expected to stay, fairly quickly, is a problem. So I have clients who have tackled that approach openly and I can think of one key employee of one of my clients who is on a four-year retirement plan. So they clearly agree. They recognised the reality and worked together practically to find a solution" (Independent HR Consultant)
Providing additional support for those employees undertaking elder-care. This support was both practical (e.g. providing information) and emotional, as illustrated by the quote below:
"We have some focus groups for staff and the main issue for them being carers whilst trying to work again is a time issue so, what we've done is we've brought some external agencies in like local caring agencies that they don't find the time to perhaps get to appointments and things and we're bringing them into the organisation so they can perhaps go and see them in their lunch hour and things (Further Education)
Informal intergenerational mentoring and knowledge exchange. This practice was popular among employers and some larger organisations were considering how to move from informal and ad hoc practices to a more formalised policy:
"We want to keep their experience and pass it on to others. So if they could become a mentor or a role model or that type of thing […] t he group has just been set up and it is a meeting on a monthly basis and reporting things to the board, I think by August this year […] If you have key people who are of a certain age, I think there is something from a business continuity point of view, about having the intelligence to know when you're going to lose that skill and experience." (Healthcare)
Accommodating different preferences. Other good practice revolved around accommodating different preferences of older workers by recognising that they may favour specific styles of working and communicating. For example, maintain paper and telephone communication.
Finally, a range of other beneficial practices were raised by individual employers. These included a more explicit focus on career and career development over a potentially longer working life within the annual review process; offering health MOTs to staff once they reached the age of fifty ( NHS); and having a bank for (retired) older workers who just want to work occasionally ( NHS and care work).
5.2.3 Good Practice in Re-training Older workers
Examples of good practice in re-training older workers were limited, in that most employers appeared keen to demonstrate that all employees are treated the same, regardless of age. This is illustrated by the following quotes:
Employer: "[We treat older workers] e xactly the same as any of our other demographics. We take a very consistent approach across all of our workforce so really does not matter if you're a paid employee or a volunteer. If is a technical requirement of the job, and again it doesn't matter what age you are, you will get trained in a way in which to do it. That includes mandatory training as well including health and safety, equipment training, a whole host of disciplines
Interviewer: Are there any particular policies at all in place to support older workers?
Employer: We don't take that approach. Because what we do is that we take a total work force approach so all of our policies apply across all of the demographics.(Voluntary Sector Organisation)
However, in one medium-sized manufacturing organisation small-scale re-training took place for some manual workers, allowing them to move between tasks, and in turn providing shift flexibility, depending on staffing requirements and production runs.
Other organisations had devised innovative ways to overcome the challenges associated with new technologies ( Section 5.1.2) and adopted these in their training practices. An employer in private care had worked to overcome older employees' lack of self-confidence by involving their clients in familiarising employees with new technologies. The Scottish Government (who participated in the study as an employer) has deployed 'reverse mentoring' using the expertise of its younger workers to assist those less familiar with e.g. social media tools and platforms.
Moreover, as with the communication example in Section 5.2.2 above, an age-sensitive approach to training methods was seen to be helpful in encouraging training among older workers:
"So me saying to an older worker 'there's an online module that you have to log onto and it'll self-teach you how to use it', that wouldn't work. However, other, classroom-based processes will work with them." (Scottish Government)
The overriding finding from the employer interviews and focus groups is that employers were very open to thinking of opportunities to draw upon the talent pool of older workers and in the main viewed extending working lives as a positive trend. However, this openness and enthusiasm did not always translate into action. Specifically there had been more attention focused to date on retaining existing older workers than on recruiting new ones or on equipping older employers for the needs and requirements of a contemporary workplace via (re)training. In many ways this emphasis is understandable as it reflects employers' most pressing concerns about how to best manage their existing workforce, but indicates that there is still much to be done in encouraging and supporting a more proactive approach to employment across an extended working life.
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