Private sector organisations

When discoursing on ageing the underlying assumption is the necessary curtailment of physical activities and social involvement. Through the media, social science theory, humour and social policy the suggestion is that with age, peoples abilities diminish and the culture has arose in which people devalue the older person as able, whether it be in the workplace or the general life course (Wearing, 1995). During the late 1970s and early 1980s the government spent generously on bribing older workers out of the job market offering early retirement, rather than to be humiliated out of a job, to make way for the young (economist, 1999).

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This in a sense, has left with it a stigma surrounding older workers, therefore, they are perceived as unable, less productive members of the work force. After the Second World War came the ‘baby – boom’. Populations in Organisation for Economic Co-Operation and Development (OECD) countries got much younger. The baby – boomers had relatively few children and their children, today’s young society, are choosing to either have children later in life or not at all.

The demographic projectionists did not foresee the continuous fall in birth rates, therefore, it has hit the United Kingdom and various other countries like Japan and Germany hard. Consequently, now this situation has come to light, governments across the borders are attempting to curtail the negative impacts of our ageing population on the economy. ‘For the first time in history, the old will start to outnumber the young (Penycate, 2000: 1). The baby – boomers are now in their early fifties, their prime earning years, with few children.

This in contrast to the increased longevity of their parents gives the ‘older person’ power in numbers as people over 45 years old will consist of 40% of the working population by 2010 (lg-employers. gov. uk, 2004). What we are presented with is an enormous fiscal challenge, and it has been suggested that something must be done now to avoid the adverse consequences on pensions, health care, benefits and the population (Hicks, 1998). The dependency ratio between tax-paying workers and dependant pensioners in Britian today is 3. 5: 1.

By 2050 it has been predicted that it will that the ratio will be 2. 1: 1 and in neighbouring countries for example Germany it could be 1. 2:1 and in Italy as low as 0. 7: 1. This indicates that every Italian worker will be supporting himself, his family and one pensioner he does not know (Penycate, 2000). One suggestion is to bring immigrants into the countries where the population levels are declining. Devenport (2000), suggests that in the absence of immigration, not only will the level of the population fall but so will the ratio between those of working age and those who are expected to retire.

Without immigration the only alternative will be to increase the working age limit to 75 years, as this will maintain the levels of pensions and benefit support that is currently needed. Penycate (2000), however, suggests that millions of immigrants will be needed now to keep the work – pensioner balance as it is and that the simplest, more obvious and most likely solution would be to work longer. If working longer is the most likely solution, how will this affect the employers of these ‘older workers’ and how could they respond to the ageing of the workforce.

Firstly, who are ‘older workers’? The Age Discrimination in Employment act applies to individuals aged over 40 years and the committee for Economic Developments New Opportunities for Older Workers identifies older workers as 45 years pus (Lockwood, 2003). We shall assume that the older worker is categorised as 45 years and above and that the older baby – boom generation will just be reaching 6s5 years around 2010. It has been established that there are certain attitudes and beliefs surrounding the employment of older people, which has arose from the 1970s.

Litrature today suggest that older people are more than able to do the jobs which young people do, if not doing them better. With their wealth of life experience and wisdom which only comes with age, complements any older worker, and some of the skills which older workers posses are essential for the role of supervisor and manager, for example, how to handle people in a diplomatic way, they have very god judgement and they have the ability of spotting problems before they blow up (Economist, 1999).

In addition Harris and Cole (1980, cited in Victor, 1994) state that empirical evidence suggests that older workers are more productive than younger workers, they may not be able to complete physical jobs but for the majority of jobs this is unnecessary because of labour Fig. 1, Qualities an aging workforce encompass saving equipment. So the first response that managers of organisations must battle with is the stereotyping of the older workers.

Ashbridge (2003) believes that challenging attitudes will be the largest challenge facing employers and that demographics will force a change in attitude. Research suggests that employers shy away from employing the older person, as many people believe they are paid more and are less productive, the fact is that generally older workers are paid more because they are worth more to the organisation, their education standards are generally higher than graduates of today (Economst, 1999) It is important that employers invest in all their workers through training and development, but not always essential in some jobs.

However, with an ageing workforce training and development is vital. As the employees reach retirement age employers tend not to invest in them with marketable skills as they may feel they are not worth investing in for the fact that they are near to the end of their working lives. Nonetheless, retention rates of older workers are higher than them of young people (Lockwood, 2003), for the reason that young people tend to switch jobs frequently (Economist, 1999), therefore, it is the older workers that will offer the best return on training in the long term.

There is a variety of alternatives to retirement for older workers, Reday-Mulvey and Taylor (1996) suggest the gradual retirement scheme, which is also known as phased, partial or part-time retirement, which is present in Denmak, France, Germany, Luxemburg, Spain and Italy. Employers and Trade Unions are slowly beginning to realise that retiring employees can in fact result in an inseparable loss of expertise and skill, consequently, adopting gradual retirement into the organisation allows employees to reduce their working hours, draw part-time pay and partial pension.

This permits organisations to use the time left with the employees to use them to train up new workers and serve as mentors, in addition they offer flexibility that other workers may not give as in most circumstances they do not have the commitments which younger workers may have. Another approach that is used in America to tempt older workers to carry on working is ‘bridge ‘ jobs. This creates a gradual transition from full-time work to retirement, again, this allows the older worker to carry on working and also allows the employer to use the skills of the older worker.

Quinn, (1999, cited in Economist, 1999) found that nearly half the men and women who were in full-time jobs in America moved on to bridge jobs in middle age, and both the best paid and the worst paid carry on working (Economist, 1999). What is evident is the differences between Britain, America and many European countries. America and the European countries have already started to cater for the ageing population, whereas Britain is slowly lagging behind. Older workers in Britain do not have as many choices as workers in other countries.

The Inland Revenue prevents people from drawing any form of pension while working part-time (Reday-Mulvay, and Taylor, 1996), therefore, the only option is to work or retire. In some cases retiring is sometimes more financially beneficial as most retired people are much better off when they are retired than they would have been at an earlier age (Hicks, 1998), therefore, this gives them the disposable income which they need to spend in their leisure. Employers should be working with trade unions and the government to try to find a solution to these problems through reform of current legislation.