The ‘Silver Tsunami’: Older Workers Better Value Than Youngsters!

tsunamiJust a decade ago, experts warned of labor shortages in the United States and other countries as the baby boomers marched into retirement en masse. But with an aging population facing the prospect of living for decades on shrunken retirement funds, graying individuals plan to keep on working.

This “silver tsunami” has received a mixed response in the workplace. On the one hand, many employers have been slow to adapt to the changing needs of older workers and perceive them to be costly and troublesome to hire. Data show that people over the age of 55 find it harder to land jobs than their younger counterparts, even though age discrimination is illegal in many countries. On the other hand, some far-sighted companies around the world are working to recruit, retrain and otherwise engage older workers.

Such workers bring a lifetime of skills to their jobs and can be highly motivated and productive members of the workplace, according to Wharton professors. Many of the stereotypes that prevent employers from hiring and making good use of older workers are merely myths, they say. Among the most frequent ones:

Myth. Older workers cost more than younger ones and are less productive on the job.

Reality. Both concerns are untrue. While older workers may take longer to recover from injuries, studies show that they use fewer sick days on the whole than their younger counterparts, says management professor Peter Cappelli, who directs the Wharton Center for Human Resources. Health care costs are actually less for older workers, according to Cappelli, because most no longer have small children as dependents on their health care plans. Workers also become eligible for Medicare at age 65, which can further reduce an employer’s health care bills.

When it comes to job performance, older workers frequently outdo their younger colleagues, says Cappelli. Older workers have less absenteeism, less turnover, superior interpersonal skills and deal better with customers. “The evidence is unbelievably huge,” he notes. “Basically, older workers perform better on just about everything.”

Myth. People at or near retirement age tend to lose interest in their jobs.

Reality. Studies find the opposite to be true.In a report titled, “Working in Retirement: A 21st Century Phenomenon,” the Sloan Center on Aging & Work at Boston College reported that those who worked past retirement age became more, rather than less, engaged and satisfied with their jobs. And contrary to the belief that older workers resist learning new things, older workers ranked “job challenge and learning” as a top source of satisfaction with their work, says center director Marcie Pitt-Catsouphes.

Myth. Older workers in the workforce keep younger ones from getting jobs.

Reality. While it may be “a widespread belief that you have to get older people to retire to open up the career ladder and jobs for young people,” the opposite again is true, according to Wharton insurance and risk management professor Olivia S. Mitchell. Ignorance of this fact caused many French college students to join the massive street protests last fall against raising the retirement age from 60 to 62.

Policies in countries that encourage workers to retire early actually have a damaging impact on youth employment, Mitchell says. This is because the growing number of retirees forces governments to finance their rising pension costs by raising taxes, which causes employers to scale back hiring or pay workers less. In such cases, “employers don’t want to hire the young,” says Mitchell, who directs Wharton’s Pension Research Council. “It’s all very intertangled. The old notion of a fixed sum of jobs is just absolutely wrong.”

Many myths about older workers reflect 20th century views of retirement that have proved to be short-lived. “Historically, the idea of people working full-time and stopping completely is an anomaly of world history,” says Cappelli. The notion of retiring at age 65 came in with the Social Security system and employer-based pensions, he says. But full retirement was never what most employees wanted, he notes, adding that “what they want is to keep working in some fashion. They want to change the way they work, but not stop altogether.”

The whole article from Knowledge@Wharton  9430933

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