Preparing for an ageing workforce

Employers need to up their game when it comes to dealing with older workers according to a CIPD study which shows that half of the over-55s think they’ll be working well past retirement age.

The CIPD’s survey of more than 1,600 employees says that more than a third (37%) of all workers believe they’ll have to work past the widely-accepted retirement age of 65, a figure which jumps to 49% among workers over 55 years old. Among those who predict they will work past 65, the average age they expect to actually retire is 70.

However, the research has also found that many employers aren’t doing enough to support older workers in the workplace. Just one in four (25%) employees believe that their employer is prepared to meet the needs of workers aged 65 and over, demonstrating says the CIPD how much work organisations need to do to prepare for the increased numbers of older workers in the workplace.

Charles Cotton, Pay and Reward adviser at the CIPD said: ‘It’s shocking that, despite a large proportion of UK workers planning to work past the age of 65, employers are so underprepared to meet the needs of a maturing workforce. Older workers offer vast experience and knowledge, and can also act as mentors to young people in the workplace. To reap those opportunities, employers need to start reviewing and adapting their people practices as well as the design of the organisation, jobs and work to ensure that they are fit for the new purpose. Previous CIPD research has shown that multi-generational workforces are of huge benefit to organisations. It is very positive to see that employees are also recognising that remaining at work can help their well-being by helping them to keep mentally fit. In return, organisations have a duty to build workplaces that enable talented older workers to continue to work without facing organisational barriers.’

The research also found a lack of awareness among some employees regarding the new state pension age. For instance, a quarter of those aged 55 and over claim that they don’t know that the state pension age will increase from 65 to 66 between 2018 and 2020. Similarly, nearly half of 35-54-year-olds are still unaware that the state pension age is going to increase from 66 to 67 between 2026 and 2028.

Charles Cotton said: ‘It’s clear that many people aren’t fully aware of what kind of pension they might receive or when, especially if the state pension is going to form a significant part of their retirement income. If they find out too late what they are entitled to, then they may be forced to remain at work out of necessity rather than choice. Employers will need to look at how to meet the needs of this group and HR has an important role in communicating to employees about changes to the state pension.’

See Employee Outlook: Employee Attitudes to Pay & Pensions, Winter 2016-17 at https://www.cipd.co.uk/knowledge/fundamentals/people/pay/outlook-pay-pensions-report

What the ageing workforce means for HR has also been looked at by the Institute for Employment Studies. It suggests, based on its research, that there are four age-related areas to which HR should be paying attention:

  • Address employee financial wellbeing, given that around one-third of workers do not have more than three months’ income in savings to fall back on.
  • Offer rewards packages that allow employees to pick and choose, and that suit their needs and characteristics regardless of age.
  • Extend working lives through flexible work as state pension age rises and people choose (or need) to work well past traditional retirement age.
  • Use attitude and engagement survey data across all generations – some organisations track data throughout an employee’s journey from joining to retirement and address any gaps.

 

See Darkening Skies – IES Perspectives in HR in 2017 at http://www.employment-studies.co.uk/resource/darkening-skies-ies-perspectives-hr-2017