Why older workers could be the answer to skills shortages
By Jo Faragher on 23 September 2022
At a time when thousands of organisations are struggling to recruit staff, it may come as a surprise that employers appear to be ignoring whole pools of talent. But according to the latest figures from the UK Office for National Statistics, the employment rate gap between workers aged between 35 and 49 versus those between 50 and 64 has significantly increased to 15.1%.
A survey by recruitment company Robert Walters appears to echo these findings, showing that two-thirds of over-50 workers have been overlooked for promotion in the past year. Thanks to a combination of pandemic-driven changes to work arrangements (furlough or fewer shifts available) and lack of access to training and promotion, many older workers are leaving the workforce in their droves. The Office for National Statistics estimates that 50 to 64-year-olds will soon account for almost three quarters of the UK’s economic inactivity. It’s been described as a “silver exodus” as older workers leave jobs at a faster rate than usual, and decide not to chase further employment opportunities. In fact, Robert Walters found that many older workers have taken up “side hustles” to avoid returning to full-time employment – from short-term consulting projects to part-time jobs.
“Workers over the age of 50 come with bags of experience both professional and personal, and have a well-sought after resilience to economic upheaval considering the number of financial or political changes they have weathered in their career,” says Chris Poole, UK managing director of Robert Walters. “Employers should be concentrating on resolving the issues deterring over-50s from work. They need to compete with the allure of early retirement and more casual work options by implementing skills-sharing schemes to help stimulate promotion opportunities for mature workers, or establishing more accessible hybrid-working options to accommodate the need for flexible working.” Considering how workplace perks appeal to this generation can help, he suggests. Popular benefits among older workers include flexi-time, company pension contributions, training opportunities and private health insurance.
There had been a demographic shift going on for some time, argues Amy McSweeney, Work Evidence Officer at the Centre for Ageing Better. “Until the labour market was disrupted by COVID-19, people had been working for longer in line with rising state pension ages. Although employment rates for older workers were still lower than for younger age groups, prior to the Covid pandemic more people aged over 50 were working than ever before.” Not every person over-50 who has left the labour market did so for better work-life balance or to prioritise other things, she adds, but “there will also be many of this number who did not choose retirement out of a desire to stop working, but because they felt unable to continue. Even before the pandemic, one in three older workers felt their age disadvantaged them in applying for jobs.”
The Centre has run pilot UK projects in Greater Manchester and the West Midlands where there is strong evidence that many older workers continue to feel rejected by the labour market and struggle to find a way back to work. “While there are encouraging signs that more and more companies are grasping how much they stand to gain by employing older workers, it remains an ageist labour market and one where many older workers feel the odds are stacked against them in terms of training, progression and looking for new jobs,” she adds.
Recruit, retain and train
When it comes to harnessing the skills of the older workforce, employers need to improve the way they recruit, train and retain these employees, says Claire McCartney, senior policy adviser at the CIPD. “Older workers looking to enter or re-enter the workforce find it generally harder than other age-groups to find new employment, often as a result of discrimination or bias from employers and recruiters,” she explains. “Age discrimination negatively impacts not only individual workers, but also their families and the broader economy, and must be tackled head on.”
A lack of flexible working can also make it harder for older workers to remain in employment, particularly if they have caring responsibilities, a disability or long-term health condition, she adds. The CIPD is one of a number of organisations calling for flexible working requests to be a day-one right for all employees. “Flexible working supports inclusion and diversity in the workforce. Older workers are also more likely to have a health condition, making it important to focus on health and wellbeing and on implementing reasonable adjustments,” McCartney adds. The CIPD has previously campaigned for the government to roll out a national mid-life career review for those aged 50 and over, something that could be facilitated by employers through the National Careers Service and other web-based tools. McSweeney agrees that flexibility is key: “Flexible working is important for workers of all ages but for older workers specifically it can help balance caring responsibilities or personal health circumstances; enable a phased transition to retirement. Helping manage flexible working well is a key part of being an age-friendly employer,” she says.
Retention and reduced risk
There are other advantages to having more age diversity in the workforce: “There is strong evidence to indicate that a workforce with a sizable proportion of older workers can bring about significant advantages for companies in boosting productivity and lowering costs,” she adds. Analysis by the Organisation for Economic Co-operation and Development (OECD) shows that a firm with a 10% higher share of workers aged 50 and over is 1.1% more productive. These productivity gains come from lower job turnover and the greater management and general work experience of older workers. McSweeney adds: “Having more older workers could also save companies money, as older workers tend to stay in a job longer than younger colleagues, meaning both reduced turnover and reduced recruitment costs.”
Changes to working practices thanks to the pandemic could benefit older workers in the long term, however. Sam Alsop-Hall, Chief Strategy Officer at healthcare recruiter Woodrow Mercer Healthcare says: “Pandemic-induced working practices have improved the employment landscape for over-50s. Remote working and hybrid working have seen employers look to experience as a way to de-risk their businesses and also to stabilise them ahead of the expected protracted recession.” Alsop-Hall argues that if employers face a choice between training an entry-level candidate remotely to do a job they’ve never done and retraining an experienced candidate to work remotely, “it’s obvious which one is the better investment”. He concludes: “These trends have all helped over-50s’ chances in the job market as they are seen as a trusted pair of hands to manage themselves remotely within a traditional working pattern and working frameworks.”
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