Budgeting for boomer gloom

"The dominant factor for business in the next two decades – absent war, pestilence, or collision with a comet – is not going to be economics or technology. It will be demographics." – Peter Drucker, Harvard Business Review, 1997.

And so we learn that the upcoming federal budget is likely to include measures to encourage older workers to remain in the workforce. We say 'likely' because that's what's been leaked to the media.

Quite aside from the fact that there's about as much chance of this budget containing big spending initiatives as there is of this idea winning Julia Gillard more votes from the seniors, it's unlikely to help because what we are seeing is a profound structural shift in the job market. It will need far more radical and creative solutions than anything this government can produce. It will have to come from managers and boomers themselves.

With people living longer and with the World Health Organisation predicting tech-savvy 100-year-olds in the workplace in the coming decades, many baby boomers now realise they will be working well beyond their 60s. Indeed, sixty is now the new 40. The antiquated idea of retirement at 65, introduced by German chancellor Otto von Bismark in 1880, won't end completely but it is changing. Boomers will continue to redefine the workplace culture, simply because there are so many of them. The problem is that the management landscape is still stuck in the mindset that 60 is as good as retired. It's still driven by an obsession with youth, the fresh and the new.

That's why there are a disproportionate number of boomers who are unemployed and without full time jobs. The fact that we are living longer and healthier lives is a testament to the success of medicine and the welfare state. The fact that so many older workers are unemployed is testament that management is not prepared for this change. As the Rudd government's intergenerational report showed, increasing the productive life of older workers has become a key issue for policy makers, managers and business.

A study prepared for the Brotherhood of St Laurence last year, titled Workforce Participation and Non-Participation Among Baby Boomers in Australia, found that half of all Australians aged from 60 to 64 are not in jobs. Many of the ones that are in jobs are working part time, putting in less than 20 hours a week. With one in four saying they wanted more work, there is also an issue of boomer underemployment.

Boomers, once out of work, are being overlooked and no government program will stop that. While the Australian government has appointed an Age Discrimination Commissioner in Susan Ryan, many reports show there is a long way to go.

According to 2010 ABS data, one in five Australians aged 55 and older and looking for work said they were being knocked back because they were considered 'too old' by employers. Another ABS report, Persons Not in the Labour Force, Australia, showed that in September 2011, more than half (56 per cent) of the 90,700 discouraged job seekers were aged 55 and over. An Australian Human Rights Commission report released in 2010 found boomers claiming they are victims of age discrimination. Similarly, a National Seniors Australia report published in April last year, The Elephant In The Room, found that companies are excluding older workers by running job advertisements with phrases such as ‘fast-paced', ‘high-flyer' and ‘can-do', deliberately inserted to exclude. Then there are the surveys showing that many companies reject older workers, claiming they are too rigid and impossible to train. No budget initiative will turn that around.

Clearly management attitudes will have to change. But at the same time, older workers will need skills to get back into the workforce. The question is how do boomers change that? It requires new strategies, not all of it pretty.

Career coaches and recruiters say older job seekers should also be more flexible. That might mean being prepared to take on lower paying work down the ranks in a company. Also, they are better off targeting smaller companies that have a wider range of skills to fill. Dates should be left off resumes, especially for degrees earned decades earlier or jobs held long ago. Dates should only be used for recent positions. And be careful how you describe yourself. Rather than saying, for example, that you are a senior engineer or an engineer with 30 years' experience, it would be better to talk about your 'diverse' or 'extensive' experience. Experts also say boomers need to change the way they do resumes. With recruiters so time poor these days and likely to bin anything that looks too complicated, they should list their achievements at the top of the resume rather than chronological order. And at the very least, they say, put in a LinkedIn address to show hiring managers you're up with the trends.

National Seniors chief executive Michael O'Neill says older workers need to skill up while they're still employed. He also recommends making more use of social networking and look beyond the traditional means of landing a job. Others specialists recommend older workers learn new skills and get right across new media like Twitter, Pinterest and even starting their own Wordpress blogs. It's not that hard, just different. And it's more likely to impress hiring managers.

As for managers, they will have no choice but to put aside ingrained prejudices for one very good reason. The skills shortage will get worse. KPMG demographer Bernard Salt has talked about a "baby bust where the boomer hegemony that saw 200,000 enter the workforce each year shrinking to 50,000 by 2025.

In the next 10 years, managers will have to find new ways to working with a growing army of older people at arm's length from the organisation while filling skills gaps.

We could see radical management solutions, much like the one developed by IBM Belgium in the 1990s when it set up a separate company called SkillTeam which re-employed the early 'retired' who wanted to keep working by placing them on contracts, thus ensuring IBM held on to the knowledge and wisdom it would have otherwise lost while keeping them off the books.

The confluence of an ageing population, skills shortages and boomer unemployment is likely to see a number of IBM-style radical solutions emerging over the next decade, for managers and job seekers alike. As Peter Drucker, one of the world's most respected management thinkers warned 15 years ago, it's likely to become the big management issue.