Until recently, older people were increasingly staying in work in line with the government's aspiration to extend working lives. With the slow down in the economy all this has been put on hold. Possibly, HR departments are husbanding talent and skills selectively, recognising the value of age balanced workforces as they prune. Surprisingly the employment figures of older workers are holding up reasonably well in the recession - so far.
This relatively reassuring picture should not disguise the differential pain that older workers experience when they lose their jobs however. Older workers stay unemployed for longer. The latest figures cover the August to October quarter which is before the dramatic changes started to work through. By next month, the picture may be different.
After six months out of work, a fifty something's chance of return diminishes greatly. Again this may not be evident in the figures but long term unemployment, disillusionment of fruitless job searching and wide spread age discrimination, will force many older people to become "economically inactive," joining the ranks of the hidden unemployed. Those who get work are likely to take jobs considerably below their potential - and previous earnings.
This is why recessions are bad news for older workers. During the period 1980 - 95, the proportion of 50 to state pension age workers economically active, declined from around 83% to 65%.
During the three and four day weeks forced upon us during Ted Heath's government in the 1970s, a "job release scheme" was introduced. "Young workers for old," was its essential message.
Would it be unlawful today? The lawyers would cite the Palacios v Cortefiel Servicios case where the Spanish government introduced mandatory retirement to boost youth employment figures. (The ECJ said this was legal, by the way).
But the government wants to extend working lives not cut people off at the knees. The reason is simple - with birth rates and longevity heading in opposite directions, we are facing labour shortages in the longer term.
Companies performing best, in recessions and at other times, are the ones which value talent and knowledge, investing in these things in good times and bad alike.
In the recessions of the 70s 80s and early 90s, millions quit on early retirement and redundancy packages, siphoning skills and knowledge out of the economy. Whatever emerges this time, companies investing in competent people of all ages, developing them and applying an "age management" mind set, will be fittest to emerge from the bruising experience.
Chris Ball
Chief executive
TAEN - The Age and Employment Network
Comments (2)
Posted by Melanie Flogdell | January 6, 2009 2:48 PM
A recession is difficult for workers of all ages, but as Chris points out statistics show that it is harder for older workers to get another job. This was the reasoning given by the government for retaining the age groupings in the statutory redundancy schemes when the Employment Equality (Age) Legislation came into force in 2006. Smart businesses will continue to recruit and retain talent based on skills and competencies and not on age or years of experience! At Centrica we recognise the importance of a diverse workforce and value the creative potential that individuals of different ages bring to their work.
Posted on January 6, 2009 14:48
Posted by Ron Eldridge | January 6, 2009 2:49 PM
In a recent TalentDrain study of over 16,000 people working in the UK we have observed the following difference between older and younger workers:
Older workers tend to place less value in career progression and personal growth than younger workers. These areas are constant bug bears for organisations who are trying to retain people.
Older workers tend to show higher levels of job satisfaction, organisational commitment coupled with a lower intention to leave.
Given a potentially difficult year ahead I can’t understand why organisations would want to avoid recruiting or start making redundant people who typically have this attitude towards their employer.
Posted on January 6, 2009 14:49