Mature_Workers_in_Today's_Workforce

Mature Workers in Today’s Workforce: The Recent Trend in New Age Staffing June 2010 New age philosophies in staffing recognize workers of many diverse backgrounds. Largely resulting from the new trend of Americans living longer, the American workforce today has a plethora of older workers. Many organizations have recognized this phenomenon, and therefore have developed staffing strategies with respect to this trend. The recent Wall Street melt down has also left many mature workers unable to afford retirement, resulting in further expansion of today’s workforce. With such knowledge, staffing managers can make effective decisions with regards to the acquisition, deployment and retention of the mature workforce. Understanding the implication of mature workers in a diversified workforce is imperative within staffing strategy in today’s organizations. In fact, if not for older workers the future of the American workforce is grim, as this may result in labor shortages. It is recommended that staffing professionals recognize the benefits of an older workforce, while adequately preparing for related obstacles. It is critical to evaluate the associated cost measures, specific needs and labor requirements of older workers. It is crucial to maintaining a competitive advantage in the global market, and aligning human resource staffing with the overall organizational goals. The United States Government Accountability Office (USGAO), projects that the share of the U.S population age 65 and older will increase from 12.4 percent in 2000 to 19.6 percent in 2030 and continue to grow through 2030. Furthermore, it is expected that the average number of years that men who reach age 65 are expected to live is projected to increase from just over 13 years in 1970 to 17 by 2020. Women have also experienced a similar rise from 17 years in 1970 to 20 by 2020. The office contends that the labor force is slowing to the extent that organizations must find adequate ways to encourage workers to remain in the workforce well into retirement age; the American workforce will become highly dependent upon these workers. Older workers have been categorized in several different age groups, including ages 45, 55, 65, 75, or even older (Lockwood, 2003). Discerning a mature worker depends on the industry, which may explain the variety in age differences in the categories. A mature workforce requires staffing strategy catered specifically to such groups. Presumably, the needs of a mature worker may differ from that of a younger generation worker. Older workers have an increase of illnesses that comes with the onset of aging. Health benefits for a mature worker may need to go beyond the standard health benefit package. Many organizations have adopted policies and programs in recruitment, training and development, benefits, and retirement plans that recognize the needs of the mature worker. Age-neutral policies are becoming the norm; companies with such policies are the preferred work environment for mature workers. Many employers have yet to embrace mature workers as a part of their staffing strategy. It is an obstacle to many organizations that have yet to develop a framework that includes such workers, which is a relevant issue in retention. Employers in the information technology field have found it to be a challenge to train older workers because of their inability to pick up new skills (Economist, 2009). In particular, many have decided that it is a losing battle. The assumption is that mature workers have one foot out the door, so to incur the training cost is unreasonable. But older workers in information technology have the experience, a broad understanding of the industry including the fundamentals building up to the new technologies. Failure to realize that workers that are earning a salary, and who are not performing to their fullest potential, as a result of the unwillingness of the employer to train such workers, is in fact an unreasonable cost. The strategy to phase out mature workers simply by allowing them to remain stagnant as younger worker advance is age discrimination. It is unethical and illegal, and puts the organization at risk of a lawsuit. Research has shown that as workers reach middle age cognitive skills begin to decline. In particular, the cognitive skill of “fluid intelligence”, that is, numerical skills and the ability to adjust rapidly to new situation declines (Economist, 2009). This poses a catch-22 scenario for employers as this fact may result in a decrease in production for organizations. But employers cannot simply fire these workers as it will face legal ramifications. Therefore, it is more practical for organizations be proactive. Organizations should research ways to improve and/or maintain cognitive skills. The Institute for the Study of Aging and the International Longevity Center-USA (2007) has made several suggestions to keep one’s mind functioning as effectively as possible: * Stay socially active, * Keep learning (reading books, playing games, going to museums), * Exercise, * Eat nutritious, low-fat diet, * Practice stress management, * Seek help for sleep disorders, * Seek medical attention for underlying medical conditions, * Talk to your doctor. Organizations can use these facts in developing programs that facilitate each of the above suggestions. Incorporating these suggestions can have measurable results to an organization. For instance, a in-house gym facility, building a partnership with a fitness facility that gives employees discounts for membership or regularly scheduled social activities outside of workplace environments such as company sponsored bar-be-cue at the park can incorporate many of these suggestion. With the increase of the unemployment rate, older workers are at a disadvantage to younger workers. Research shows the mature worker is a valuable asset to many firms. The advantage of older workers in the workforce includes experience, loyalty, institutionalized memory, and a strong work ethic (Rainer, S. 2008). McDonalds Corp. has also found that 97% of mature workers are thorough and reliable when it comes to completing work assignments (Lockwood, 2006). Focusing on the benefits of employing older workers can help propel recruiting initiatives to attract more mature workers. In recruiting processes, organizations must distinguish and solicit talent with the qualifications and/or knowledge, skills, abilities and others characteristics (KSAOs) that are consisted with the overall needs of the organization (Heneman et al. 2009). Focusing primarily on KSAOs will yield a more diverse workforce that includes older workers. Organizations that embrace diversity will focus on these characteristics in recruiting processes. Human resource managers must commit to diversified recruitment policies and practices that are ethical and legal. Many policies may be outdated. Therefore, staffing managers must also update policies and programs that are inclusive to all groups in the work place to assure the commitment to diversity. According to research by the renowned talent management solutions company Taleo, retaining the traditional preference for recruiting younger talent will eventually lead to a weaker workforce than competitors who tap into the older worker talent pool (2006). Therefore, a diversifying recruitment pool that includes older workers is beneficial. To tap into an older worker pool, Taleo suggests that organizations consider 5 critical factors to ensure that it is done effectively: * Consider where you are advertizing your job opportunities, * Word your job opportunities carefully, * Capture candidate data on complaint, electronic application forms, * Drive the selection based process based on skills, * Consider re-skilling or up-skilling new or existing employees. Each of these factors can determines how well an organization can tap into the older population of job seekers; also how easily accessible it is to the older job seeker. Staffing shortages, or “brain-drain” and knowledge transfer problems as a result of retirement may encourage employers to make viable effort to keep mature workers in the work place (Pitt-Catsouphes, 2007). The weighted reliance on mature workers have cause many employers to diversify their workforce to recruit more mature workers, thereby changing the organizations demographic structure to a more uniform culture. A uniform organizational structure should be avoided, as it may limit diversification which may thereby limit opportunity in advancements through innovation and creativity. Although public opinion may think otherwise, in a Benchmark Study, a high number of 53% respondents believe that their organizations were not reluctant to hire older workers (Pitt-Catsouphes, 2007). The study also found that organizations made significant strides, training and cross training in all stages of employment to ensure that employees worked past the retirement age of 62 through 65. More than half of the respondents said that their employers have a management training course in managing multi-generational environment. A large number of organizations still view retirement as a cost saving opportunity. Retirement allows organizations to reduce labor costs as part of their operating cost. That being considered, it is comprehensible that organizations use this option as a means of retaining capital; and may strategically make it advantageous for mature workers to leave the labor force. Human capital should remain a concern for organizations as an integrated talent management policy is necessary to the overall success of an organization. Workplace diversity initiatives that focus on talent management of the mature workforce in increasing competitive market should be a crucial organizational goal for organizations. Talented employees can further an organizations’ competitive advantage and can ultimately benefit both the employee and the organization (Lockwood, 2005). In a recent study, a representative for CVS drug store admits that the drug store chain would not exist if it were not for the large number of older workers within the organization (Mullich, 2003). CVS admits that older workers seldom call out sick. Older workers also have a low turn-over rate. Frankly, the misconceptions about older workers being too old to keep up within labor force are consistently being proven untrue. There is no significant disparity as it relate to young workers and older workers when it comes to their physical and mental capacities as previously maintained. The case to hire older worker becomes even stronger with regard to recent study which suggests that United States domestic products would rise 9 percent by 2045, a value of $3 Trillion which is attributed to an increase of older workers in the American workforce (Odum, 2006). The increase of older workers will also attribute to the Department of Labor statistics finding that the labor force would increase by 17.4 percent (Odum, 2006). Increasing evidence supports that mature workers in the diversification of the workplace is advantageous to many organization on many levels. Yet, many in the human resource management have been reluctant to develop a staffing strategy that would recruit, retain and deploy older workers. The reality is that baby-boomers are remaining in our workforce beyond “retirement age”, which as of late seems to be occurring rapidly. Leadership requirements must begin to shift to one that recognizes the existence of older workers as an asset, whose talents may go beyond organizational expectations. Diversity in the workplace should not extent only to the obvious categories of sex and race, but age as well. Certain occupations requiring longer training time and more experience tends to have a saturation of older workers. Retention of older workers in management and various professional positions may prove to be challenging due to the overrepresentation of such workers within these job sectors (Amsterdam-Stassen et al. 2009). The large number of older workers in management may result in a shortage of such worker in management in the near future, as these workers decide to retire. With the increase of older workers comes the need for organizations to meet worker expectations, or face the risk of labor shortages. Ultimately, reducing turnover rates is the primary concern. Identifying what older worker expectations are will be a pivotal part in the retention process. Organizations must engage older workers into participating in perhaps an organizational seminar or survey that will allow the management to gain insight on the needs and expectations of workers; in particular their future goals within the organization. By building an overall understanding about its workforce, an organization gains useful information required in building an effective training and development plan. While several retention strategies may be recognized by organizations, one identified way to improve retention of older workers relies heavily on effective strategy and implementation of employee training and development planning. By definition, employee development programs should ensure that all workers will continuously and actively have opportunities for growth and upgrade skills, knowledge and ability for their mutual benefit. Research has found that older workers are less likely than younger worker to have access to training (Amsterdam-Stassen 2009). Other research has also suggest that older workers have difficulties in rapidly changing organizations, and are less flexible and open to human resource development (Rhebergen et al., 1997). The obstacle facing organizations is the ability to engage older worker in participation within training and development through effective strategies. Organizational strategies do not encourage training for older workers because of the belief that the payoff potential is not significant. This can relay a message that the organization lacks support for their employees; a need necessary in building a lasting employee commitment to their jobs and the organization. Organizations worldwide are increasingly gaining awareness of the mature worker in the labor force. In Singapore and Japan, organizations have made a valiant effort to retain their mature workers. Their governments’ have legislation that provide companies with incentives to keep their older workers (Odum, G., 2007). Despite this fact, companies have yet to develop an internal staffing strategy for these workers. So, it is not sufficient to have government involvement to retain employees. A survey of 25 organizations worldwide, 19 organizations admitted though there were retention policies, there were not recruiting policies to accommodate this demographic (Odum, G., 2007). An age awareness policy is critical for all organizations. Healthcare being the primary concern for employers, as it relates to older workers should be managed efficiently. Creating programs that include preventative healthcare plans like wellness programs where employees, young and old, are encouraged to participate; and take good care of their health is imperative. Employers with well-established wellness programs are seeing lower rates of age related illnesses such as diabetes and high blood pressure among their older workers than other comparable organizations’ 40 and over employees (Retrieved, 5/20/10, www.hrmorning.com). Organizations must give older workers the support and reassurance that illness or injuries will not adversely affect their jobs. In fact, in most cases wellness programs will likely limit the onset of injury, and help manage illnesses effectively so that it does not affect job performance. Aged workers perception of benefits package may be a factor in determining whether to remain in the workforce. For those organizations that find value in their aging workforce and would like to retain existing aged workers, there must be an initiative to include an extensive benefits package for older workers. With greater life expectancy, workers need to finance more years of retirement; and must become more educated about financing retirement because retirement funding must last longer. Half of U.S workers do not have pension plan through their employers, and those who do are less likely to be covered by a define benefit plans for most companies have shifted to using defined contribution plans (USGAO, 2006). The increase of responsibility for retirement for the worker means a decrease in value of coverage. It is likely that workers will find that they are ill prepared to retire. Organizations can develop more intricate retirement package that enables workers to diversify retirement saving, with an added incentive for doing so. The U.S government has passed several employment discrimination laws to protect the American worker, including the Age Discrimination in Employment Act of 1967 (ADEA). The law prohibits employment discrimination because of age against employees over 40 in hiring, firing, and compensation; and provisions for mandatory retirement restrictions (Jennings, M. 2003). It covers all employers with 20 or more employees. The Equal Employment Opportunity Commission (EEOC) is responsible for enforcing employment discrimination laws, and may file suit on behalf of employees and the commission. If an organization is found liable in discrimination suits it may bear significant financial damages paid to the employee, and/or fine by the EEOC. Age discrimination is the source of growing discontent and concern for older workers. AARP surveyed 1,500 employees between the ages of 45 to 74, 64% said age discrimination is a normal part of their professional lives; and they have concerns relating to employment opportunities within their own workplace (2002). The Conference Board, a non-profit business research and training organization, found similar results in their survey of 1,600 workers over 50 (2003). There is an obvious disconnect and lack of awareness about the plight of the older worker. In fact, author of the Conference Board Survey, Howard Muson, contends that some employers were unaware if they dealt with age discrimination in their employee training programs. In addition to this finding, Muson concluded: * Employees say supervisors perpetuate negative stereotypes by reserving promotion opportunities for younger employees. But the vast majority of HR executives (75 percent) say older workers get the same promotion opportunities, * Older workers say age-diversity training is important, especially for managers. But 81 percent of HR executives say their diversity training does not address supervisor attitudes toward older workers, * Two-thirds of older workers want more training and leadership development opportunities. Two-thirds of HR executives say their companies do not offer training for mature workers as an incentive to upgrade skills. In order to bridge the gap between older workers and younger workers, employers must recognize that age discrimination does exist in lower level throughout the organization. The lack of awareness to the existence of older workers in the workplace and difficulties they may face as a result. is critical to understanding the older workers needs. Furthermore, HR leaders must deploy a diversity plan that is implemented from top management down to lower level management, and collaborate with lower management on the progression of the strategy. Unemployment rate has risen sharply for older workers since the beginning of the recession in 2007. The jobless rate of older workers was 7.1in February 2010, while the record high nationally in December 2009 was 7.2 (Bureau of Labor Statistic, 2010). Older workers unemployment rate is lower than their younger counterparts, but the numbers are alarming as it is more difficult for older workers to gain employment once unemployed. The Bureau of Labor Statistic has found that nearly half of unemployed older workers (49.5%) have been unemployed for 27 weeks or longer in February 2010, compared to 28.5 % of workers age 16-24 years and 41.3% of workers ages 25-54 years (2010). Clearly older workers are at a disadvantage when it comes to hiring practices. Perhaps one reason for these disparate numbers is the likelihood that many older are highly skilled and experienced workers who may not be willing to make a sacrifice in pay or title for a less skilled job. Nevertheless, the bureau states that older workers are still participating in large numbers within the labor force. The older worker on average is said to earn less than workers age 16 and over. This fact has been evident since 1979 through 2007, based on Bureau of Labor Statistics research. Employers who fail to fairly compensate older workers do so because they feel these workers are less valuable to the organization. For instance, it is common to come across managers who have a long history with an organization who make less than newly hired younger employees. Organizations must reevaluate wage scales in efforts to bridge the gap in compensation. Compensation that is adequately evaluated through performance evaluation and equally throughout the organization can be a motivational tool for older workers in the workplace. Those who simply wish to phase out these workers should keep in mind; new trend of workers having to be responsible for their own retirement makes it even more difficult to leave the workforce if they are unfairly compensated. Unfortunately, most organizations have yet to deploy a full staffing strategy for the aged worker. Whether or not organizations have recognized the aged worker as an asset, with many talents that can be called upon, is irrelevant because the mature worker will remain a fixture in the American labor force. Human resource managers and leaders should continue to commit to a diversified workforce by remaining in touch with the overall needs of the organization and its workers. Keeping up with the rapidly changing organizational environment can be a challenge; but failing to adopt policies to manage this workforce while overcoming these challenges can be detrimental. Lastly, the concept of age is entirely subjective; and what may be attributed to one “older” worker may not apply to others. References Armstrong-Stassen, M., Ursel, N., (2009) Perceived organizational support, career satisfaction, and the retention of older workers. Journal of Occupational and Organizational Psychology. The British Psychological Society. 82, 201-220. Work til you drop. (2009, June 27) Economist. 392, 8637 Grossman, R. (2003). Are you ignoring older workers' Older workers say they aren’t treated well, but many HR professionals-to their own potential detriment- aren’t getting the message. HR Magazine. August 2003. Henenman, H.G & Judge, T.A. (2009). Staffing Organizations. New York: McGraw Hill. Lockwood, N.R. (2006). 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