Posts Tagged “jobs for older workers”

Australia ‘middle of the pack’ in handling ageing workforce

PwC launched the results of the Golden Age Index yesterday, an OECD ranking of nations by their employment of mature age workers.

Australia jumped five places to be ranked in 15^th place, which PwC global people business leader Jon Williams attributes to the Federal Government’s efforts to increase support of Australia’s ageing demographic.

Iceland, the occupier of the top spot, has retained the highest place since 2003.
The index is a weighted average of seven indicators that reflect the labour market impact of workers aged over 55:

Employment rate, 55-64
Employment rate, 65-69
Gender gap in employment 55-64
Incidence of part time work, 55-64
Full time earnings, 55-64, relative to 25-54
Average effective labour force exit age
Participation in training, 55-64

“While Australia is in the middle of the pack moving from 20th to 15^thplace among the 34 nations, New Zealand continues to excel, maintaining its second place behind Iceland,” Williams said at the launch.

He explained that the PwC modelling shows that If Australia’s employment rate for workers aged 55-69 grew to be equal to that of New Zealand’s by 2050, Australia could:

Increase GDP by 4.7% – $198 billion at today’s value
Improve the Commonwealth and state/territory budgets by 1.7%
Reduce net debt by 11% GDP by 2050

“Employing more mature workers doesn’t block the path for younger workers, it actually makes our nation stronger, as more workers generate more demand and therefore more jobs in the economy,” Williams continued. “However we need to change our social bias toward older workers to allow this to happen.”

Williams criticised the population’s mindset, which he suggested needs to be moved out of a rut.

“We are stuck in a cradle to grave model of career progression with a stigma towards changing careers and taking a step back,” he said. “Treasurer Joe Hockey’s appointment of Susan Ryan AO as the first Ambassador for Mature Age Employment is a great step forward. It’s pleasing to see the Federal Government’s commitment to a group of workers that are sometimes overlooked.”

This year’s Budgest Announcement included a pledge to improve career prospects for mature workers, with the Government reducing the payment period of the $10,000 ‘Restart Wage’ subsidy to 12 months.

“Businesses who make better use of the skills and experience of older workers gain a real competitive advantage at a time when their customer bases are also ageing,” Williams said.

Key initiatives

“From the perspective of an individual company at a point in time, it might seem that more older workers could just block progression and new job opportunities for younger workers,” the report’s authors said. “However, from a longer term macroeconomic perspective, as we are adopting in this study, this should not be the case.”

The report suggested that businesses could gain from job redesign and role shifts to enable longer careers and manage the health issues facing older workers.

“Training and development should not stop at 50,” the report states. “Family crisis leave, career breaks and alumni programmes could all help to utilise the skills of older workers at a time when customer bases are also ageing. Age should be included indiversity audits for companies.”

It was also suggested that companies should strive to “move away from linear seniority-based career paths”.

“This would allow older workers, where appropriate later in their careers, to shift down into part-time or advisory roles, avoiding any possible blockage to the career progression of younger workers,” the report reads.

Is Scandinavia’s approach the answer?

According to the index, Sweden has one of the OECD’s highest employment rates for older workers, particularly amongst women.

“This reflects a series of policy measures since the early 1990s to counteract early retirement and support older workers,” the report says. “A new state pension regime introduced in the 1990s provided incentives to keep working beyond 65, supported by tax incentives for both individuals and employers.”

“Policies to keep women in the workforce after maternity also seem to be reflected in longer working lives for women. This may also be influenced by evolving social norms.”

PwC’s rankings

The top 20 countries for employing mature workers are:

1. Iceland
2. New Zealand
3. Sweden
4. Israel
5. Norway
6. Chile
7. United States
8. Korea
9. Japan
10. Estonia
11. Switzerland
12. Denmark
13. Mexico
14. Canada
15. Australia
16. Finland
17. Portugal
18. Germany
19. United Kingdom
20. Netherlands

Source: HC Online

Over 50? 5 Smart Tips for Landing a New Job

By Chad Brooks, Business News Daily Senior Writer

For many people, finding a new job after the age of 50 becomes more difficult.

After losing a job, older job seekers, compared to younger counterparts, receive fewer job offers, search for weeks longer and are ultimately less likely to find re-employment, according to a new study recently published in the Psychological Bulletin.

Based on data from the U.S. government’s 2014 Displaced Worker Survey, researchers discovered that job seekers over age 50 are likely to be unemployed 5.8 weeks longer than someone between the ages of 30 and 49, and 10.6 weeks longer than workers in their 20s. Additionally, the odds of being re-employed decrease by 2.6 percent for each one year increase in age.

“There’s very robust evidence that as an individual moves beyond age 50, they experience a large penalty toward how quickly they will find a job,” Connie Wanberg, one of the study’s authors and a professor at the University of Minnesota,said in a statement.

There a variety of factors that contributing to these results.[Surprise! Older Workers Have Fewer Senior Moments ]

“The obstacles to re-employment success stem not just from employer views about older workers, but also from age-related differences in knowledge, skills and abilities and the kind of jobs people want,” said Ruth Kanfer, one of the study’s co-authors and a professor at Georgia Tech University. “As individuals age, their skills and abilities change and they may often seek a different type of job.”

Kanfer points to construction workers who carry heavy objects as an example.

“If they change occupations or move into a different field, that is likely going to slow their search,” she said.

Smaller social networks, marketplace needs, search strategies and what workers want out of a new job are among the other factors that are contributing to older workers’ lack of success in finding new jobs.

To help older job seekers increase their chances of finding work, Wanberg and Kanfer offer several tips:

Stay current: It’s critical that workers never stop trying to learn new skills. Even workers who are currently employed should look for ways to grow their skills and stay current with their industry.
Boost job search strategies: Older workers are often unfamiliar with the ways job searches are conducted today. It is important they comb a variety of job search websites and understand the applicant requirements and hiring trends for the type of job they’re looking for.
Know what you’re up against: Older workers should fully understand that it is possible to find a new job, it’s just likely it will take a little longer than expected. Knowing this going into the process will help them stay persistent in their search.
Define your goals: When looking for a new job, older workers need to think about which aspects of a new job are most important to them and set clear goals and priorities to guide their search.
Build social networks: When aging, there is a tendency to narrow social networks, which can impact how long it takes to get a new job. It’s critical to maintain and expand on social networks when getting older.

The researchers believe the study shows there is a clear need for a better understanding of how younger and older job seekers differ in their re-employment goals.

“Job loss is really difficult for older workers, many of whom have probably already been thinking about retiring or slowing down, but had not yet reached a level of financial security to permit retirement,” Kanfer said. “Losing your job at this point in life creates a real conundrum – should I put myself through the strain of a job search or just retire for now?”

The study was co-authored by Darla Hamann, a professor at the University of Texas at Arlington, and Zhen Zhang, a professor at Arizona State University.

Source: The New Daily

6 Things Older Workers Can Do to Find a Job Faster

By Chad Brooks, Business News Daily Senior Writer

While finding a new job is a difficult task for nearly everyone who has been unemployed, it’s especially tough on older workers, new research finds.

Half of those between the ages of 45 and 70 who’ve been unemployed during the past five years are still out of work, according to a study from AARP. Specifically, 38 percent remained unemployed, while 12 percent decided to stop working.

“As the economy continues to recover and the unemployment rate falls, there are still far too many people struggling,” Debra Whitman, AARP’s chief public policy officer, said in a statement. “Many Americans want to work as long as possible, but our survey confirms that, once unemployed, it can take a long time for older workers to find a quality job.”

Overall, 45 percent of jobseekers over the age of 55 were out of work for at least 27 weeks. The research revealed several strategies that could be contributing to the success of those who have been able to find new jobs.

The reemployed were more likely than the unemployed to contact employers directly and to reach out to their networks of contacts to find jobs. By comparison, the reemployed were less likely to rely on relatives and friends to find out about job opportunities.

Other strategies that were effective for those who found work included:

Using a headhunter
Consulting professional associations
Checking online job boards
Using online social networks
Visiting a public employment agency

When searching for new jobs, older workers need to be prepared to find a position in a new field. Occupational change was a common occurrence among the reemployed, with more than half having a job different from the one they had before becoming unemployed.

“Some of those ‘occupational transitions’ may have been the result of a decision to do work that was more personally rewarding and interesting,” the study’s authors wrote. “In most cases, however, the change was probably necessary to find a job.”

Finding new jobs, however, didn’t always translate into a return to normalcy for older workers.Among those who did find work, 48 percent were earning less money than in their previous jobs. The study revealed that the longer they were out of work, the larger the impact it had on their earning power. Nearly 60 percent of the reemployed who suffered a long-term spell of unemployment were earning less in their current job, compared with 41 percent who had been among the short-term unemployed.

While they may have suffered financially, not everything about their new jobs was a step backward for older workers.

Nearly half had better working conditions, while nearly 40 percent said the number of hours they worked and their shift were better. The study also discovered that roughly one-third of the reemployed said their current jobs provided more use of their experience, education and skills, more autonomy and more responsibility than their old jobs.

“As the results of this study indicate, the unemployment experiences of older workers are varied and their outcomes uncertain,” the study’s authors wrote. “More detailed analyses of the data are needed to help us better understand the plight of the older unemployed, even as the economy recovers, and to develop meaningful policies and programs to help them.”

The study was based on surveys of 2,492 people between the ages of 45 and 70 who had been unemployed at some time during the past five years.

Source Business News Daily

Forget Gen Y, female baby boomers are the changing face of the workforce

BY KIRSTEN ROBB / JUN 16, 2015

The number of older Australians participating in the workforce is rising, with an increased number of Australian women working past the age of 55, according to research from the Melbourne Institute of Applied Social and Economic Research.

The study comes off the back of the Intergenerational Report, which recently highlighted the ageing workforce and the importance of employers taking older employees into consideration.

The wide-ranging research, titled Two Decades of Change: The Australian Labour Market 1993–2013, shows the number of both men and women in the workforce over the age of 55 had increased significantly in the last two decades.

In particular, it showed a sharp rise in the number of women aged 60-64 still in the labour force, jumping from 15.2% in 1993 to 45% in 2013. The number of women aged 55-59 working in 2013 had hit 65.3%, from 36.8% in 1993.

Likewise, the number of men aged 65 or older working or looking for work doubled in the two decades to reach 17% in 2013, while the number of those aged 60-64 had increased from 48.3% to 62.5%.

Roger Wilkins, who co-authored the report with Mark Wooden, told Smart Company the swell of older Australian women participating in the labour market reflected a broader societal shift in female labour force participation.

“Twenty years ago, older females had very low participation rates, so there was an enormous amount of scope for change there,” Wilkins says.

“Twenty of thirty years ago, younger women began heading into career-type employment… Those women are now aged 50 to 60, so a lot of the increase is reflecting that.”

Wilkins says the steadily increasing age of pension eligibility over the past 20 years is also reflected in the research.

Asked if this ballooning of an ageing workforce will continue, Wilkins says while it is speculative, there is “certainly still plenty of room for a further increase of older workers”.

“I would be surprised if it got up to levels [in other brackets], but there is considerable scope for a further increase in the participation rate of 55 and over,” he says.

Meanwhile, Nikki Brouwers, chief executive of workplace rehabilitation and health specialist group Interact, says the research is a reminder for small businesses to consider employing older Australians. Brouwers recommends employers consider several ways of attracting and retaining an older workforce.

“Firstly, employers need to consider the flexibility of work hours. Older workers will often want to work earlier and finish earlier,” she says.

“There’s also the consideration of learning styles. Online learning for example might not be the best approach for older workers.”

Lastly, Brouwers says there are other issues such as ergonomics, lighting and movement that employers should take into account.

“What small business employers need to realise is they don’t need to be experts, they just need to engage with their workers, because at the end of the day, they will be best able to articulate what they need,” she adds.

This article first appeared at Women’s Agenda sister publication, Smart Company.

Working until 70 a health struggle for over 20 per cent of us

The government wants Australians to keep working until they are 70, to reduce pressure on the aged pension, but new research shows that nearly a quarter of people now in their 40s will be too sick to stay in the workforce.

Treasurer Joe Hockey last year proposed lifting the age at which people are entitled to full access to their superannuation, known as the preservation age, from 65 to 70 for anyone born after January 1966.

In 2035, when the change would take effect, the majority of retired or unemployed Australians in their sixties will not have enough superannuation to fund their retirement.

Rather than simply working longer, we need to re-think our approach to retirement. Reaching a certain age shouldn’t mean we need to leave the workforce entirely.”: AMP chief customer officer Paul Sainsbury. Photo: Dean Sewell

Potential impacts of changes to the preservation age are a focus of a self-initiated research project currently being undertaken by the Productivity Commission.

A report released on Wednesday, produced by finanical services giant AMP Ltd and the University of Canberra’s National Centre for Social and Economic Modelling (NATSEM), predicts that by 2035 one in four men and one in five women in their sixties will no longer consider themselves in good health.

“Rather than simply working longer, we need to re-think our approach to retirement. Reaching a certain age shouldn’t mean we need to leave the workforce entirely. Early years in retirement should be a transition period with reduced levels of work, giving people more time to focus on their interests and wellbeing, while still saving money,” AMP chief customer officer Paul Sainsbury said.

The AMP/NATSEM report concludes that if the pension age is raised to 70 many Australians will need to consider working longer to have an income and build more retirement savings, but this will be a problem for those who are no longer in good enough health to do so.

Working longer will be a challenge for one in five men and one in four women who are predicted to be in fair or poor health when aged 60-69 in 2035, the report finds.

“The good news is that Australians are living longer. But we know more years in retirement places more strain on our superannuation balances so it’s likely many of us will need to work longer. But this raises some confronting questions, in particular, how healthy we will be in the later years of our working life and what our financial position will be,” Mr Sainsbury said.

The report also finds that those people currently aged in their 40s who don’t consider themselves in good health now, are less likely to be well enough to still be working in 20 years time. The need to save more now is more urgent for this cohort.

More than 50 per cent of workers aged 60-69 are professionals. Manufacturing, electricity and construction sectors employ one in four men aged 60-69. The education and health sectors dominate the employment of women.

Australia’s self-assessed health status is ranked fourth in the OECD and similar to that for Switzerland, Sweden and the United States. Canada and New-Zealand are healthier than Australia.

“There is an important role employers can play to help re-design the workplace of the future so that older workers can stay at work for longer and transition to retirement in a way that suits them, while building wealth and income along the way,” Mr Sainsbury said.

Source: The Age Business Day

Older workers face challenges but some employers are responding

Date: June 6, 2015 – 12:15AM

Rachel Browne

Social Affairs Reporter

If you’re over 50 and looking for work you face some tough choices: 15 years on Newstart until you reach pension age and hundreds of job applications which go nowhere. But some large employers are responding writes Rachel Browne

Mature workers Peter Kitson-Crowe 65 (left) and Ronny Brennan 64 (right) at their work, Masters Home Improvement in Casula, Sydney. Photo: Kate Geraghty

At 64 years old and a grandfather of 10, Ronny Brennan doesn’t fit the profile of a typical sales assistant.

While many of his contemporaries are seeing out their 60s on the golf course, Brennan spends his days organising stock and advising customers at Masters Home Improvement in Chullora.

I’m too young to retire but apparently too old to get a job.

Deborah Murray, 58-year-old job seeker

A former locksmith, Bobcat operator and gardener, he tried retirement but his wife ordered him to get back to work.

Mature aged worker Peter Kitson-Crowe. Photo: Kate Geraghty

“I thought it would be hard to find a job at my age but this came up and I jumped at it,” he said. “I want to keep working. I’ve got no intention of retiring.”

His colleague Peter Kitson-Crowe, 65, is similarly motivated: “I’m not going to retire. I’m too young. I want to be here into my 70s.”

Kitson-Crowe was a corporate banker in a time “when you reached 55 you were gone”. The Menai man took a package from his former employer when he was in his early 50s to focus on settling his young daughter into school. After a period of working as a financial consultant and mortgage broker, he decided he wanted a “fresh start” and now works in freight at Masters.

Masters Home Improvement is part of Woolworths, one of an increasing number of large employers actively recruiting workers aged over 50.

Mission Australia chief executive Catherine Yeomans is urging more companies to follow suit to offset the growing ranks of the mid-life unemployed who won’t reach pension age for many years.

“Australia is changing and workplaces need to keep up with that,” she said. “Nowadays, 60 is no longer considered old, people are having children later, and many are paying off mortgages later in life. It is nonsensical to prejudice older workers who bring a great deal of skills, knowledge and expertise which should not be overlooked.”

People aged over 50 comprise more than a third of the long-term unemployed and one-quarter of Newstart recipients.

Brennan and Kitson-Crowe are two of the lucky ones. But it can be a bleak picture for many, according to Judy Higgins, director of Older Workers, Australia’s leading job board for the over-50s.

“The longer they are out of work, the harder it is for them,” she said. “It does affect their self-esteem, it does affect their mental health. They go downhill very quickly.”

Deborah Murray is 58 and has been out of work for more than three years. While caring for her elderly mother in Sydney’s east, she’s applied for hundreds of jobs but refuses to lose hope.

“It is tough. I’m too young to retire but apparently too old to get a job,” she said.

“You get so many knockbacks you get to the point where you just don’t care. You just feel as if nobody wants you. You have to keep trying, though. You can’t give up.”

Murray previously worked in accounting but has been turned down for basic office administration roles.

“Being unemployed is one of the biggest drawbacks in itself,” she said. “Employers look at you and wonder what’s wrong with you.”

IT systems engineer Mark Gerrey, 51, has applied for more than 500 jobs in the past four months, joking that looking for work has become his “full time job.”

With 22 years’ experience in the navy and a decade in IT, he’s learned to decode the language of the job advertisements.

“If they use words like energetic, bright and enthusiastic they are after a 25-year-old” he says. “You may as well not apply.”

Gerrey, of Campbelltown, believes experience and maturity are undervalued by many recruiters.

“I’ve commonly heard that I am over-qualified for a role,” he said.

Buthe, too, refuses to give up on his job search, ever hopeful that some upcoming interviews will lead to work.

Source: SMH

The professor who wants to cut older workers’ pay to make them more employable

Professor of management at London Business School Lynda Gratton was in Sydney for the World Business Forum. Dominic Lorrime

by Misa Han

Employers should experiment with pay cuts and salary freezes for older workers to overcome age discrimination at work, a leading human resource professor says.

But any company that follows her advice would risk a public campaign run by advocacy group National Seniors Association.

Lynda Gratton, a London Business School professor and HR consultancy Hot Spots founder who advises big banks and insurance companies in Australia, said companies should consider not giving employees pay rises as they get older, or even giving them a pay cut.

Ms Gratton, who was in Sydney on Wednesday to address the World Business Forum, said: “I think one needs to be a bit more creative about how we think of age and salary structure.

“One difficulty is in any corporation, because people’s salary goes up every year, the older you are often the more you’re paid and that makes older people more expensive.

“So one of the things we’ve been playing around with is, would it be sensible for people’s salary not to go up just because they’re getting older and that would make them easier to employ? Would it be possible to think about their salary going down and they do more mentoring and coaching work?

“I think we’ve only ever seen age and salary as a straight line that goes up but why don’t we think about it as a line that goes down?”

OUT OF TOUCH

National Seniors Australia chief executive Michael O’Neill said her comment was “completely out of touch” with the Australian industrial relations system and he would be prepared to fight against any bank or insurance company that reduced employees’ pay on the basis of their age.

“I would be happy to run a campaign against any institution that chooses to reduce workers’ pay because of their age and I’m sure consumers will react,” he said.

“We recognise the contribution older Australians make in the workplace. They should be remunerated fairly and it’s nonsense to say otherwise. Negotiating pay based on a birth certificate is clearly unacceptable.”

Age Discrimination Commissioner Susan Ryan said Ms Gratton’s comments did not apply to the Australian industrial environment.

“In general people are not paid more just because they had birthdays,” she said. “Most people negotiate their pay with their employer.”

Ms Ryan said in some cases workers might want a less-demanding role as they get older.

“Both the employer and the employee may agree on a different role, with a lesser pay package,” she said.

Most banks and financial sectors had been doing well in addressing age discrimination in the workplace, she said.

“They do it because their customers want to deal with experienced officers. So I think banks recognise the value of the experience of older employees to their business.”

LEGAL HOT WATER

Employers who took Ms Gratton’s advice might also find themselves in legal hot water.

Employment law firm Justicia managing partner Sarah Rey warned that employers who gave staff pay cuts or salary freezes purely on the basis of their age exposed themselves to the risk of unlawful age discrimination.

“Ultimately anti-discrimination laws prevent employers from discriminating on a variety of grounds. So if you are treating someone poorly and it has nothing to do with their performance, then that would be discrimination. If you’re looking to treat them less favourably it has to be something other than age,” she said.

More older workers are projected to remain in the workforce beyond the traditional retirement age of 65. But a survey commissioned by the Age Discrimination Commission found in the past two years more than half of jobseekers over 50 were discriminated against on the basis of age.

The Treasury’s Intergenerational Report in 2015 predicts the workforce participation rate among those older than 65 will jump from 12.9 per cent in 2015 to 17.3 per cent in 2055.

To encourage employment of older workers, the government has introduced a grant of up to $10,000 to employers who hire workers older than 50 who have been unemployed for six months or longer.

Ms Gratton said while she was not aware of companies pursuing her pay strategy, in practice older workers were already taking pay cuts as they quit their jobs and moved into different jobs, such as consultancy roles.

HAPPENS ANYWAY

“I think in labour market it happens anyway because people leave corporations and they get jobs that pay them less. I think in reality it is happening but I don’t think corporations acknowledge that.”

One way of thinking about salary could be linked to child rearing, she said.

“One could actually say the time when people need most money is when they are in their 30s, when they have young kids to look after. When they are getting paid more in their 40s and 50s is actually when they don’t require as much money.”

Ms Ryan said Ms Gratton’s comment about the expenses related to child-rearing responsibilities did not reflect the diversity of the nation’s families.

“Many in their 50s have got their second families. If they have a second family and a second mortgage they would be in a terrible situation.”

Source: AFR

A billion shades of grey

An ageing economy will be a slower and more unequal one—unless policy starts changing now

WARREN BUFFETT, who on May 3rd hosts the folksy extravaganza that is Berkshire Hathaway’s annual shareholders’ meeting, is an icon of American capitalism (see article). At 83, he also epitomises a striking demographic trend: for highly skilled people to go on working well into what was once thought to be old age. Across the rich world, well-educated people increasingly work longer than the less-skilled. Some 65% of American men aged 62-74 with a professional degree are in the workforce, compared with 32% of men with only a high-school certificate. In the European Union the pattern is similar.

This gap is part of a deepening divide between the well-educated well-off and the unskilled poor that is slicing through all age groups. Rapid innovation has raised the incomes of the highly skilled while squeezing those of the unskilled. Those at the top are working longer hours each year than those at the bottom. And the well-qualified are extending their working lives, compared with those of less-educated people (see article). The consequences, for individuals and society, are profound.

Older, wiser and a lot of them

The world is on the cusp of a staggering rise in the number of old people, and they will live longer than ever before. Over the next 20 years the global population of those aged 65 or more will almost double, from 600m to 1.1 billion. The experience of the 20th century, when greater longevity translated into more years in retirement rather than more years at work, has persuaded many observers that this shift will lead to slower economic growth and “secular stagnation”, while the swelling ranks of pensioners will bust government budgets.

But the notion of a sharp division between the working young and the idle old misses a new trend, the growing gap between the skilled and the unskilled. Employment rates are falling among younger unskilled people, whereas older skilled folk are working longer. The divide is most extreme in America, where well-educated baby-boomers are putting off retirement while many less-skilled younger people have dropped out of the workforce.

Policy is partly responsible. Many European governments have abandoned policies that used to encourage people to retire early. Rising life expectancy, combined with the replacement of generous defined-benefit pension plans with stingier defined-contribution ones, means that even the better-off must work longer to have a comfortable retirement. But the changing nature of work also plays a big role. Pay has risen sharply for the highly educated, and those people continue to reap rich rewards into old age because these days the educated elderly are more productive than their predecessors. Technological change may well reinforce that shift: the skills that complement computers, from management expertise to creativity, do not necessarily decline with age.

This trend will benefit not just fortunate oldies but also, in some ways, society as a whole. Growth will slow less dramatically than expected; government budgets will be in better shape, as high earners pay taxes for longer. Rich countries with lots of well-educated older people will find the burden of ageing easier to bear than places like China, where half of all 50-to-64-year-olds did not complete primary-school education.

At the other end of the social scale, however, things look grim. Manual work gets harder as people get older, and public pensions look more attractive to those on low wages and the unemployed. In the lexicon of popular hate-figures, work-shirking welfare queens breeding at the taxpayer’s expense may be replaced by deadbeat grandads collecting taxpayer handouts while their hard-working contemporaries strive on.

Nor are all the effects on the economy beneficial. Wealthy old people will accumulate more savings, which will weaken demand. Inequality will increase and a growing share of wealth will eventually be transferred to the next generation via inheritance, entrenching the division between winners and losers still further.

One likely response is to impose higher inheritance taxes. So long as they replaced less-fair taxes, that might make sense. They would probably encourage old people to spend their cash rather than salt it away. But governments should focus not on redistributing income but on generating more of it by reforming retirement and education.

Age should no longer determine the appropriate end of a working life. Mandatory retirement ages and pension rules that discourage people from working longer should go. Welfare should reflect the greater opportunities open to the higher-skilled. Pensions should become more progressive (ie, less generous to the rich). At the same time, this trend underlines the importance of increasing public investment in education at all stages of life, so that more people acquire the skills they need to thrive in the modern labour market. Today, many governments are understandably loth to spend money retraining older folk who are likely to retire soon. But if people can work for longer, that investment makes much more sense. Deadbeat 60-year-olds are unlikely to become computer scientists, but they could learn useful vocational skills, such as caring for the growing number of very old people.

Old power

How likely are governments to make these changes? Look around the rich world today, and it is hard to be optimistic. The swelling ranks of older voters, and their disproportionate propensity to vote, have left politicians keener to pander to them than to implement disruptive reforms. Germany, despite being the fastest-ageing country in Europe, plans to cut the statutory retirement age for some people (see article). In America both Social Security (the public pension scheme) and the fast-growing system of disability benefits remain untouched by reform. Politicians need to convince less-skilled older voters that it is in their interests to go on working. Doing so will not be easy. But the alternative—economic stagnation and even greater inequality—is worse.

Source: The Economist

Employers need more than money to hire older workers

Beyond being told or incentivised to hire older workers, employers need to feel they are making the right decision. Image sourced from Shutterstock.com

With Australia’s official retirement age heading to 70 by 2035, this year’s federal budget brings forward incentives designed to encourage companies to employ older workers.

The Restart Program, which provides $10,000 to employers to hire over 50s will have payments accelerated, and the government will also provide incentives to older unemployed people to retrain in order to get a job.

The measures go part of the way to addressing the challenges faced by older workers, but come amid ongoing age discrimination in Australia.

Empirical evidence suggests negative stereotypes are at the heart of this form of ageism. Such stereotypes are found among employers as well as the community at large.

Ageist attitudes and related stereotypes are a general socio-cultural phenomenon and are not confined to the workplace, meaning employers’ attitudes toward older workers are simply a reflection of a broader worldview. Being in positions where their decisions have direct impact on the lives of older workers, however, means their views attract more attention than those of other people.

It is not the intention of employers, who typically seek the best person for the job, to discriminate against older workers. But stereotypes are activated automatically in response to cues. For example, a person’s age, appearance, or date of graduation from school are all relevant cues that impact perception and judgement. Despite best intentions, employers’ judgement can be automatically biased by ageist stereotypes so they may miss the best person for the job in cases where it happens to be an older worker.

Common interventions to address ageism toward older workers have been in the form of policies, legislation, and fact sheets, with the former aimed at enforcing fair practice and the latter providing information. Policies, however, provoke resistance to change when people are being told to think and/or behave in particular ways and feel their free choice is threatened. Fact sheets, incongruent with employers’ worldviews, are often perceived as incorrect.

Getting past stereotypes

There are however ways to promote positive attitudes toward older adults among employers and increase the likelihood of them being hired.

One intervention tested successfully involved inducing cognitive dissonance. Cognitive dissonance is a mentally unsustainable state that is evoked when a person holds two contradictory thoughts and/or beliefs simultaneously.

People are naturally driven to reduce cognitive dissonance, so much so that it often results in them either changing their attitude or further affirming their initial positions.

In our study we made employers aware that discriminating against older workers was potentially counterproductive and against our culturally enshrined value of a “fair-go”. Having been asked to endorse this view and provide their names, employers were advised they would be listed as people who opposed hiring discrimination against older adults and who were committed to non-discriminatory practice. This meant they would ultimately experience cognitive dissonance in response to activation of negative stereotypes in subsequent considerations of older workers.

We also developed fact sheets based on common misconceptions about older workers. Combining the cognitive dissonance aspect with the fact sheet produced the strongest effect.

Employers who participated in this part of the study showed more positive attitudes toward older workers overall, stated that they were more than likely to hire older workers, and considered age to be less important in making hiring decisions.

Attitudes are said to be relatively resistant to change, but by refuting misconceptions and enabling cognitive dissonance to be evoked in employers, we enabled them to maintain a sense of self-integrity as well as professionalism because these were now aligned with fair treatment of older workers.

Ultimately, it was the internal motivation of hiring decision makers that made the difference, as opposed to dictating to employers how they should behave. The next phase is to discuss various ways the intervention could be implemented.

2015 Budget initiatives to assist older workers

jobactive

From 1 July 2015 the Australian Government is introducing new employment services called jobactive. These services will replace Job Services Australia to help more job seekers find work and be more responsive to the needs of employers by preparing job seekers with the skills and attributes that employers are looking for.

Under jobactive, job seekers on income support will have access to tailored assistance from a jobactive provider based on their assessed needs. This could include help with looking for work, writing a resume and preparing for interviews, referrals to jobs and training that is suited to the skills that local employers need. People looking for work who are not receiving income support may also be eligible to receive some services under jobactive. For more information, job seekers can contact the National Customer Service Line on 1300 854 414.

Employers will be able to receive assistance from jobactive providers to help them find staff by screening and matching job seekers to available vacancies and by providing support once a new employee starts. These services are provided at no charge and employers may be able to receive financial help through a wage subsidy when they employ an eligible mature age, young, long term unemployed or Indigenous job seeker.

Restart

The Restart programme is a wage subsidy paid to employers to assist mature age people participate in the workplace at the same time as encouraging employers to expand their business and benefit from the wealth of experience mature age workers bring. Job seekers who are 50 years of age or older and have been unemployed and on income support* for six months or more can attract a Restart wage subsidy for an employer. Eligible mature age job seekers employed for 30 hours can attract the full rate of the Restart subsidy, and those employed between 15-29 hours per week can access a pro-rata amount.

As part of the ‘Growing Jobs and Small Business Package’ announced in the 2015 Budget, the Restart wage subsidy has been redesigned to make it easier for employers to access. From 1 November 2015, employers will be able to access the full subsidy of $10,000 (GST inclusive) over 12 months instead of the current two years, when they employ an eligible job seeker. The Restart wage subsidy will include up to $6,500 paid during a 12 month period and a bonus of up to $3,500 for employment which lasts the full 12 months. Employers already making use of Restart will also be able to transition to the new arrangements.

As part of these improvements, employers no longer need to wait until the end of a six month qualifying period to access their first payment. Payments can be made progressively, as frequently as fortnightly if needed. This will particularly help small business at the time when their hiring and training costs are greatest. Large employers who take on at least ten or more mature aged staff will also be able to negotiate the timing of payments to help meet the specific costs associated with hiring multiple staff, including lump-sum payments covering multiple employees. For more information: https://employment.gov.au/changes-restart-wage-subsidy

Employers will be able to contact a local jobactive provider to discuss the unique requirements for their business from 1 July 2015. For more information, employers can contact the Employer Hotline on 13 17 15 or visit the Department of Employment website at www.employment.gov.au/jobactive.

* Newstart Allowance; Parenting Payment; Disability Support Pension; Bereavement Allowance; Widow Allowance; Carer Payment; Special Benefit; Partner Service Pensioners; War Widows; Age Pension; Mature Age Partner Allowance; Wife Pension; Widows B Pension

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