Last week AHRI released the findings of a study we conducted at the end of 2011 on the workforce participation of older workers.
AHRI has been involved in this issue for some 10 years now, at one stage initiating the development of workshop for DEEWR on Younger Managers and Older Workers. In those early days the issue was primarily considered to be under the banner of workforce planning and was stimulated by the widespread realisation of an imminent loss of mature talent caused by an ageing baby-boomer workforce.
While remaining largely a bi-partisan political matter, in more recent times the focus of the issue has moved under the elusive productivity banner and is now a direct responsibility of the Employment Participation Minister, Kate Ellis.
The productivity argument seems simple enough on the face of it. At the macro level Australia’s total factor productivity has been poor since the early 2000s and it’s not showing signs of improving. As a real income and standard-of-living indicator, a rise in productivity takes into account developments in education, innovation, management, leadership, capital infrastructure, labour and other factors that produce more from given inputs. With considerable numbers of Australians outside the labour market who could be participants in it, governments since Peter Costello’s 2004 welfare-to-work budget was delivered have been openly striving to boost participation to increase the inputs and taxation revenue base and reduce the proportion of the working age population drawing on welfare.
That said, productivity improvements won’t magically happen when a government policy is announced because they depend on decisions made by businesses and improvements generated within workplaces. And some of those improvements have to do with the labour force. In parts of the economy Australia has a labour shortage, yet we have plenty of workers either having recently left or are about to retire from the workforce. At a micro level, governments have been saying to those workers: ‘Think again before taking the retirement step! You have things to offer and you may not find it so easy to get back into a job.’
At the same time governments are also saying to businesses that they should seriously think about ways to re-engage, re-energise and retain their mature age employees, those 55 years of age and older, many of whom are tempted by retirement but who are capable of contributing their skills in the workforce.
And that’s where the study we released on mature-age workforce participation comes in. HR practitioners within businesses are charged with the responsibility of engaging their workforce. They are also charged with the responsibility of coming up with exit strategies for employees who are disengaged or underperforming.
The survey asked around 30 tick-box questions and invited comment on a few of them, so the survey would have taken a good 15-20 minutes to complete. Despite that, and despite having it open for not much longer than 24 hours, more than 1200 AHRI members responded to it. The issue is a live one!
The findings of the study reveal that around a quarter of respondents (22%) believe loss of older workers has caused their organisation to become less competitive and a significant proportion (46%) believe the departure of older employees has caused loss of key knowledge and skills. In addition, 82% want their organisations to take steps to retain older employees.
At the same time, the study reveals a strong trace of workplace negativity about retaining or recruiting mature-age employees, with 35% of respondents reporting their organisations were biased to some extent against the employment of older workers and 63% reporting their belief that negative workplace perceptions about older workers influence employment decisions.
And although 62% reported that their organisation did not distinguish between older and younger workers when deciding who to keep on the payroll, 22% openly indicated a preference for discarding older employees.
The narrative that emerges from these seemingly contradictory results is one about a grudging workforce realisation that enterprises need their older workers to stay around long enough to pass on essential knowledge and skills but to then move on. There is little by way of politically incorrect commentary in the respondent qualitative data but a distinct negative undercurrent comes through.
If that’s true for the recruitment of mature-age workers, it’s even more pronounced when looking at the other cohorts that make up the unemployed labour market. Respondents were given the choice of sourcing recruits for their organisation from five groups and chose in order: unemployed older workers (48%), skilled immigrants (25%) and unemployed youth (13%). Unemployed Australians with a disability (7%) and unemployed Indigenous Australians (7%) came in a long last.
In an address given last week to an AHRI directors networking forum in Sydney the recently appointed Age Discrimination Commissioner, the Hon Susan Ryan AO, acknowledged the contradictions at work in the narrative when she referred to ”a serious disjunction between raising the pension age to 67, the needs of the worker-starved economy and the persistence of age discrimination in employment,” and pointed out that “both poverty and homelessness were growing among older Australians”.
Commissioner Ryan added that “complaints to the Australian Human Rights Commission about age discrimination had recently risen by 44%, enquiries about age discrimination on the basis of being too old were up 78%, while Australian Bureau of Statistics data showed one in five over 55s seeking longer hours and 18% of unemployed over 45s claimed their main difficulty was that employers considered them ‘too old’.”
This is clearly a vexed issue and it’s yet another one that HR practitioners are dealing with at the front line. I thank the 1212 respondents to the AHRI study and commend its findings to policy makers, business leaders and other HR practitioners.
To view the full report of the study go to http://www.ahri.com.au/MMSDocuments/profdevelopment/research/research_papers/mature_age_workforce_participation_final.pdf
Serge Sardo is the chief executive of the Australian Human Resources Institute