It seems extraordinary that Wayne Swan needs to kick in $1000 of tax payers money to get employers to hire older workers, when almost half of Australian firms are finding it difficult to recruit staff, particularly experienced ones (Many employers having recruiting problems, April 18).
What is extraordinary is that senior workers are finding it hard to find work, when they actually are likely to be the most engaged workers you will find in your workforce.
Research by Ernst & Young shows that the older a worker becomes, the more motivated they are to contribute.
That means that older workers are not only keen to perform the best job they can, but also draw on those years of experience to do that.
What the survey also uncovered is that a third of us are either actually planning to leave an organisation in the next 12 months or actively looking elsewhere. This is particularly so in those key ‘learning and earning years’ where younger workers see a lot of roles as stepping stones. Older workers, by contrast are likely to be far more loyal to their employer.
The economics of a more engaged worker are well proven. While no employer is going to sniff at $1000 dollars, clever companies are already seeing the potential benefits from tapping into mature, experienced staff. Not only can they add value in the workplace, they will increasingly be part of the sales front line. Westpac has identified this cohort as a critical team to drive sales for a generation of women underprepared for retirement. Developer Stockland also believes the older market will increasingly be a major revenue driver and is doing a lot of work in developing communities that are able to accommodate the lifestyle needs of our healthier, longer living population.
Research out of the UK’s Newcastle University Centre on Ageing show that over 50s control 80 per cent of the country’s wealth and spend three times as much on goods and services, and recreational and culture activities. Despite this, only 10 per cent of any marketing budget is directed at them. This will have to change, and older employees are best placed to attract these high spenders.
Source: Newcastle University, changing age for business
While there is a clear business case for better utilising older workers, there is a far more important national interest at play here.
The baby boomer bonus of $10 million over four years will be a drop in the tax bucket compared to the already large and growing costs of an ageing population. We are living longer than ever before. According to the UN, already almost a quarter of our population is over 65. They refer to this statistic as the Old Age Dependency Ratio. That means seniors are dependent on workers aged 20-64 to subsidise pensions, services and health care. This number will only get larger.
We need to keep existing workers in jobs for longer and there has been a lot of research into the best way to do that. Developed in Finland, the Workability Index can show very real productivity benefits from thinking more holistically about the design and structure of workplace. Westpac is using it to try to increase the working life of its employees by two to three years (Productivity's holistic management medicine, April 10).
It also can make a huge difference to things such as absenteeism, sick leave and workplace injuries, according to a survey of over 200 companies. According to Peter Harte of Kronos, a firm that makes staff scheduling solutions for the likes of Cadbury Schweppes and Hilton hotels, absenteeism costs Australian companies up to $2 billion in lost productivity a year.
Source: Ernst & Young; Driving productivity through workplace wellbeing
Working longer, working smarter
If you plan to take the $1000 investment there are four things that Louise Rolland, expert on ageing and workability at Ernst and Young suggests you do to if you want to maximise your investment (in the worker).
What older workers want from their employers:
1. Good relationship with their manager. Older workers will stay in their jobs for longer if they are close with their bosses
2. Interesting job content.
3. Continuing investment in skills and training. If you think you ‘can’t teach an old dog new tricks’, you are wrong.
4. Flexible job structure. Click here to see how Westpac, Stockland and Diageo are managing for a flexible workforce.
If Australia is to solve its productivity problem, we shouldn’t be letting older, experienced employees go to waste, when they have plenty of years ahead of them.
PRODUCTIVITY SPECTATOR: Wayne Swan's baby boomer bonus
The treasurer is offering employers $1000 just to hire older workers, but he shouldn't have to because they offer the experience that Australian firms can't seem to find.