By: Ph.D. Carlos María Alcover
Universidad Rey Juan Carlos
Madrid, España
carlosmaria.alcover@urjc.es
The last two decades have brought rapid and significant socio-demographic, economic and labor market transformations. Increased longevity and the combined decrease in the mortality and birth rate define the current demographic transition.
The global share of older people (aged 60 years or over) increased from 9.2% in 1990 to 11.7% in 2013, and it is estimated that by 2050 it will reach 21.1%. It is expected that by 2025 there will be just over 98 million persons older than 60 years of age in Latin America, and in 2050, one in four Latin Americans will be over 60 years old. However, it should be noted that there are important differences from one country to another. For example, the growth of the aging population in Bolivia, Guatemala and Nicaragua is not much, while in Brazil, Colombia, Costa Rica, Ecuador, Mexico, Peru and Venezuela it is moderate, and in Argentina and Chile, especially in Cuba and Uruguay, it is high. In 2050, the proportion of people older than 60 years will reach 25% in Latin America and the Caribbean, while in Europe and North America it will exceed 31%. In at least 64 countries, the population over 60 years will reach 30% in 2050. This list is made up of developed countries, but also of most countries of Latin America and many of Asia, including China. It is possible that in 2050 the older population (above 65 years old) in some Latin American countries, like Brazil, Chile and Mexico, will be greater than that of the United States.
One of the most important consequences of the progressive aging of the population are changes in orientation of the mid and late stages of the professional career and the need to prolong working life beyond the normal or official ages of retirement. This point raises an important debate for states, societies, organizations and individuals, since it has to do with the pension systems and social protection, the organization of work and the management of organizations, the health and well being of the elderly, and the cohesion and solidarity between generations. Human resources management in organizations must consider these changes and meet the challenges to motivate, lead, achieve the best performance and ensure a healthy environment for older workers. Are organizations prepared?
Opportunities for Organizations
Older workers can be a source of sustained competitive advantage provided they are managed correctly. Greater overall experience, possession of an implicit knowledge derived from practice and coping in very different situations and having higher levels of emotional stability (increasing their resilience in stressful situations and reducing social conflicts at work) are the most important assets of older workers. This resource of experience should be perceived, evaluated and optimized by the organization. What attitude do those responsible for human resources show toward their older workers? Studies have identified two approaches in practice.
First, the “depreciation” approach considers that people are more motivated and make their greatest contributions in the early and middle stages of their career, and decline as they mature and get older. The age at which obsolescence is manifested varies, but this approach considers that “the older worker” is a worker with “deficiencies.” This approach reinforces negative stereotypes and difficult intergenerational relations at work, favors the development of prejudice toward older workers and pushes them to leave the labor market. This view is based on four myths: the myth of age, which sustains that age is an infallible indicator of the state of the person, when in reality labor capacity is more situational than chronological; the myth of declining productivity, based on the belief that energy, interest and motivation inevitably diminish over time; the myth of the professional career, which assumes there is no reason or value to promoting and empowering older people; and the myth of retirement, which maintains that, because of all of the above, the only possibility for older workers is to retire, and that retirement is the final stage of a working life.
The second approach is that of “conservation,” which sees older workers as renewable assets that continue being valuable to the organization. Consequently, human resources managers include them in training and development programs, and give them a place in the promotion and design of the career. At the same time, measures are taken to address the personal and family needs of older workers. These measures include part-time work or a reduced workday, flexible hours, reduced workload, flexible benefits, voluntary sabbaticals, changes in professional roles or task adaptation and work redesign. Studies have shown that the implementation of these organizational practices and the possibility of choosing largely influence the decision to keep working or opting for retirement.
Organizations can also have highly motivated older workers. The myth that motivation decreases or disappears with age is false. In recent studies it has been found that motivation does not diminish in older workers, rather it is transformed. In the early and middle stages of the career, motivation is often dominated by extrinsic motives – achievement and professional development – while in the final stages it comes from intrinsic motives – security and social contact.
Challenges for Organizations
For organizations to maintain and convert their older workers into opportunities, they must face and give effective answers to a series of challenges.
First challenge: changing attitudes toward age. It is necessary to change stereotypes and reduce prejudice against older workers. Their abilities are not diminished or lost, but they change and must be adapted or updated. It is necessary to provide them development opportunities, ongoing training and retraining, especially skills that improve with age, such as the capacity for analysis, integration of knowledge and experience, and advice. To meet this challenge the organization should define a development goal.
Second challenge: assessments of objective and fair performance. The systems of assessment of productivity must conform to the age of employees. Productivity criteria should be variable; and human resources management that is sensitive to the diversity of people cannot set standards for everyone and consider them as identical replaceable parts. Older workers must be given respect and recognition. To meet this challenge the organization should define a goal of assessment and recognition.
Third challenge: to provide the opportunity for the development of new skills. The professional career involves transitions, which represent the possible change in the functions of each stage. Older workers may assume new skills, such as internal consultant, mentor, trainer, etc., with greater dedication and commitment. Offering these possibilities and defining them can help in career transitions. To meet this challenge, the organization should define a goal of negotiation of the professional career.
Fourth challenge: managing age diversity in the workforce. The company has to adapt working conditions and offer flexible schedules, horizontal position changes, task redesign, reduced hours or work periods, and changes of positions or tasks. Redistribution or redefinition of workloads can contribute to stress reduction and facilitate recovery. To meet this challenge, the organization should set a goal of flexibility and recovery.
Fifth challenge: promoting a culture of generational diversity. A cultural change is needed in organizations to recognize the value of each age group for achieving objectives. Fostering relationships and collaborations between younger and older workers and promoting the potential of knowledge can create synergies and increase interdependencies. These policies can be specified in the following message: “Being different is not a problem, the problem is to be perceived and treated as different.” All employees can learn from each other. To meet this challenge the organization should set a goal of fostering a culture of diversity.
The Choice of Bridge Employment
In addition to the above, human resources management aimed at older adults also has a very attractive option: bridge employment. Bridge employment is the set of forms of work practices between the full-time professional career and permanent retirement. Bridge employment patterns can be considered as varieties of retirement that prolong working life, while the term “retirement” refers to the final departure from the workforce. The transitions that characterize bridge employment occur both in the same occupation and in different occupations, and may occur in forms of wage employment (part-time, fulltime or temporary) or in forms of self-employment or entrepreneurship.
Regarding the factors that foresee the acceptance of bridge employment are the perception of good health, an age around the late fifties or early sixties, greater organizational tenure,, high level of satisfaction and enjoyment of the job, a perception of being very competent or having great skills related to the career, a strong entrepreneur orientation, having a partner who also works and children or dependent relatives in the family (environment), having the need to maintain a level of income after retirement age or to ensure the necessary contributions to receive a pension, lack of compensation and benefits systems or defined pension plans, and the desire to reduce levels of stress and excessive workload of a fulltime job.
In the last 20 years, the modalities of bridge employment in different countries have shown the following benefits to individuals and organizations: improvements in the psychosocial quality of life and life satisfaction during, before and after retirement; increased well being and occupational health; reduction of serious diseases and functional limitations and improvement in the mental health of older workers; increased satisfaction and adjustment to retirement; strengthening the autonomy and financial security and economic well being after retirement; decreasing the experiences of age discrimination in older workers, and promoting flexible employment agreements that allow organizations to retain (and even attract) experienced and skilled workers when they reach retirement age. Finally, although the evidence of the effect of gradual retirement on productivity is still scarce, qualitative data indicates that older workers who hold positions after retirement age are motivated and competent and productive.
In summary, organizations have great opportunities to optimize the contributions of older workers to achieve their goals. There are challenges to face and resolve, but the experiences of success by implementing policies and human resources practices are a guarantee of achieving the desired goals. The challenge of the current and future demographic changes requires organizations to be up to task: We must treat and assess older workers as we would want to be treated when we reach that age.
References
Alcover, C. M., Topa, G., Parry, E., Fraccaroli, F. and Depolo, M. (eds.) (2014). Bridge Employment: A Research Handbook. London and New York: Routledge.
Alcover, C. M., Topa, G. and Fernández, J. J. (2014). La gestión organizacional de los trabajadores mayores y los procesos de mantenimiento, prolongación y salida de la vida laboral. Papeles del Psicólogo, 35, 2, 91-98. http://www.papelesdelpsicologo.es/pdf/2359.pdf
Bal, P. M., Kooij, D. T. A. M. and Rousseau, D. M. (eds.) (2015). Aging Workers and the Employee-Employer Relationship. London: Springer.
Wang, M., Olson, D. A. and Shultz, K. S. (2013). Mid and Late Career. An Integrative Perspective. London and New York: Routledge.
Yeatts, D., Folts, E., and Knapp, J. (2000). Older workers adaption to a changing workplace: employment issues for the 21st century. Educational Gerontology, 26, 565-582.
The Aging Population and Human Resources Management: Opportunities and Challenges
Universidad Rey Juan Carlos
Madrid, España
carlosmaria.alcover@urjc.es
The last two decades have brought rapid and significant socio-demographic, economic and labor market transformations. Increased longevity and the combined decrease in the mortality and birth rate define the current demographic transition.
The global share of older people (aged 60 years or over) increased from 9.2% in 1990 to 11.7% in 2013, and it is estimated that by 2050 it will reach 21.1%. It is expected that by 2025 there will be just over 98 million persons older than 60 years of age in Latin America, and in 2050, one in four Latin Americans will be over 60 years old. However, it should be noted that there are important differences from one country to another. For example, the growth of the aging population in Bolivia, Guatemala and Nicaragua is not much, while in Brazil, Colombia, Costa Rica, Ecuador, Mexico, Peru and Venezuela it is moderate, and in Argentina and Chile, especially in Cuba and Uruguay, it is high. In 2050, the proportion of people older than 60 years will reach 25% in Latin America and the Caribbean, while in Europe and North America it will exceed 31%. In at least 64 countries, the population over 60 years will reach 30% in 2050. This list is made up of developed countries, but also of most countries of Latin America and many of Asia, including China. It is possible that in 2050 the older population (above 65 years old) in some Latin American countries, like Brazil, Chile and Mexico, will be greater than that of the United States.
One of the most important consequences of the progressive aging of the population are changes in orientation of the mid and late stages of the professional career and the need to prolong working life beyond the normal or official ages of retirement. This point raises an important debate for states, societies, organizations and individuals, since it has to do with the pension systems and social protection, the organization of work and the management of organizations, the health and well being of the elderly, and the cohesion and solidarity between generations. Human resources management in organizations must consider these changes and meet the challenges to motivate, lead, achieve the best performance and ensure a healthy environment for older workers. Are organizations prepared?
Opportunities for Organizations
Older workers can be a source of sustained competitive advantage provided they are managed correctly. Greater overall experience, possession of an implicit knowledge derived from practice and coping in very different situations and having higher levels of emotional stability (increasing their resilience in stressful situations and reducing social conflicts at work) are the most important assets of older workers. This resource of experience should be perceived, evaluated and optimized by the organization. What attitude do those responsible for human resources show toward their older workers? Studies have identified two approaches in practice.
First, the “depreciation” approach considers that people are more motivated and make their greatest contributions in the early and middle stages of their career, and decline as they mature and get older. The age at which obsolescence is manifested varies, but this approach considers that “the older worker” is a worker with “deficiencies.” This approach reinforces negative stereotypes and difficult intergenerational relations at work, favors the development of prejudice toward older workers and pushes them to leave the labor market. This view is based on four myths: the myth of age, which sustains that age is an infallible indicator of the state of the person, when in reality labor capacity is more situational than chronological; the myth of declining productivity, based on the belief that energy, interest and motivation inevitably diminish over time; the myth of the professional career, which assumes there is no reason or value to promoting and empowering older people; and the myth of retirement, which maintains that, because of all of the above, the only possibility for older workers is to retire, and that retirement is the final stage of a working life.
The second approach is that of “conservation,” which sees older workers as renewable assets that continue being valuable to the organization. Consequently, human resources managers include them in training and development programs, and give them a place in the promotion and design of the career. At the same time, measures are taken to address the personal and family needs of older workers. These measures include part-time work or a reduced workday, flexible hours, reduced workload, flexible benefits, voluntary sabbaticals, changes in professional roles or task adaptation and work redesign. Studies have shown that the implementation of these organizational practices and the possibility of choosing largely influence the decision to keep working or opting for retirement.
Organizations can also have highly motivated older workers. The myth that motivation decreases or disappears with age is false. In recent studies it has been found that motivation does not diminish in older workers, rather it is transformed. In the early and middle stages of the career, motivation is often dominated by extrinsic motives – achievement and professional development – while in the final stages it comes from intrinsic motives – security and social contact.
Challenges for Organizations
For organizations to maintain and convert their older workers into opportunities, they must face and give effective answers to a series of challenges.
First challenge: changing attitudes toward age. It is necessary to change stereotypes and reduce prejudice against older workers. Their abilities are not diminished or lost, but they change and must be adapted or updated. It is necessary to provide them development opportunities, ongoing training and retraining, especially skills that improve with age, such as the capacity for analysis, integration of knowledge and experience, and advice. To meet this challenge the organization should define a development goal.
Second challenge: assessments of objective and fair performance. The systems of assessment of productivity must conform to the age of employees. Productivity criteria should be variable; and human resources management that is sensitive to the diversity of people cannot set standards for everyone and consider them as identical replaceable parts. Older workers must be given respect and recognition. To meet this challenge the organization should define a goal of assessment and recognition.
Third challenge: to provide the opportunity for the development of new skills. The professional career involves transitions, which represent the possible change in the functions of each stage. Older workers may assume new skills, such as internal consultant, mentor, trainer, etc., with greater dedication and commitment. Offering these possibilities and defining them can help in career transitions. To meet this challenge, the organization should define a goal of negotiation of the professional career.
Fourth challenge: managing age diversity in the workforce. The company has to adapt working conditions and offer flexible schedules, horizontal position changes, task redesign, reduced hours or work periods, and changes of positions or tasks. Redistribution or redefinition of workloads can contribute to stress reduction and facilitate recovery. To meet this challenge, the organization should set a goal of flexibility and recovery.
Fifth challenge: promoting a culture of generational diversity. A cultural change is needed in organizations to recognize the value of each age group for achieving objectives. Fostering relationships and collaborations between younger and older workers and promoting the potential of knowledge can create synergies and increase interdependencies. These policies can be specified in the following message: “Being different is not a problem, the problem is to be perceived and treated as different.” All employees can learn from each other. To meet this challenge the organization should set a goal of fostering a culture of diversity.
The Choice of Bridge Employment
In addition to the above, human resources management aimed at older adults also has a very attractive option: bridge employment. Bridge employment is the set of forms of work practices between the full-time professional career and permanent retirement. Bridge employment patterns can be considered as varieties of retirement that prolong working life, while the term “retirement” refers to the final departure from the workforce. The transitions that characterize bridge employment occur both in the same occupation and in different occupations, and may occur in forms of wage employment (part-time, fulltime or temporary) or in forms of self-employment or entrepreneurship.
Regarding the factors that foresee the acceptance of bridge employment are the perception of good health, an age around the late fifties or early sixties, greater organizational tenure,, high level of satisfaction and enjoyment of the job, a perception of being very competent or having great skills related to the career, a strong entrepreneur orientation, having a partner who also works and children or dependent relatives in the family (environment), having the need to maintain a level of income after retirement age or to ensure the necessary contributions to receive a pension, lack of compensation and benefits systems or defined pension plans, and the desire to reduce levels of stress and excessive workload of a fulltime job.
In the last 20 years, the modalities of bridge employment in different countries have shown the following benefits to individuals and organizations: improvements in the psychosocial quality of life and life satisfaction during, before and after retirement; increased well being and occupational health; reduction of serious diseases and functional limitations and improvement in the mental health of older workers; increased satisfaction and adjustment to retirement; strengthening the autonomy and financial security and economic well being after retirement; decreasing the experiences of age discrimination in older workers, and promoting flexible employment agreements that allow organizations to retain (and even attract) experienced and skilled workers when they reach retirement age. Finally, although the evidence of the effect of gradual retirement on productivity is still scarce, qualitative data indicates that older workers who hold positions after retirement age are motivated and competent and productive.
In summary, organizations have great opportunities to optimize the contributions of older workers to achieve their goals. There are challenges to face and resolve, but the experiences of success by implementing policies and human resources practices are a guarantee of achieving the desired goals. The challenge of the current and future demographic changes requires organizations to be up to task: We must treat and assess older workers as we would want to be treated when we reach that age.
References
Alcover, C. M., Topa, G., Parry, E., Fraccaroli, F. and Depolo, M. (eds.) (2014). Bridge Employment: A Research Handbook. London and New York: Routledge.
Alcover, C. M., Topa, G. and Fernández, J. J. (2014). La gestión organizacional de los trabajadores mayores y los procesos de mantenimiento, prolongación y salida de la vida laboral. Papeles del Psicólogo, 35, 2, 91-98. http://www.papelesdelpsicologo.es/pdf/2359.pdf
Bal, P. M., Kooij, D. T. A. M. and Rousseau, D. M. (eds.) (2015). Aging Workers and the Employee-Employer Relationship. London: Springer.
Wang, M., Olson, D. A. and Shultz, K. S. (2013). Mid and Late Career. An Integrative Perspective. London and New York: Routledge.
Yeatts, D., Folts, E., and Knapp, J. (2000). Older workers adaption to a changing workplace: employment issues for the 21st century. Educational Gerontology, 26, 565-582.