With demographic changes, skills shortages and recent UK legislation on age all making their mark, a new Research Insight from the Chartered Institute of Personnel and Development (CIPD) highlights the importance for employers to address the challenges presented by an ageing workforce to recruit, retain and engage talent.
The research, carried out on behalf of the CIPD by Cranfield School of Management, examines what employers are doing to ensure that the way they reward and recognise individual and collective contribution is actually appealing to older workers. It shows that a more holistic approach to pay and reward is necessary ñ organisations need to look across their financial and non-financial reward offerings to consider whether they are attractive to older workers.
However, while the research finds many examples of employers introducing initiatives to make their organisation more appealing to older workers, most have been introduced on an ad-hoc basis to deal with specific issues. What is lacking is a systematic and integrated approach to reward that examines whether the pay and the financial and non-financial benefits are appealing to all individuals, irrespective of their age, race, gender, etc.
This ëtotal rewardí approach can help employers meet the challenges of an ageing workforce by looking at what motivates them in the workplace. The use of non-financial rewards, for example, initiatives to promote work-life balance, can be an effective way of promoting the attraction and engagement of an older workforce.
Charles Cotton, CIPD Reward and Employment Conditions Adviser comments:
ìEmployers are recognising the importance of an older workforce but this is being influenced by the law and what they can and canít do, rather than what they should be doing. For instance, while employers have been examining pay progression, few have taken the opportunity to evaluate whether the way they structure pay is sufficiently flexible to meet individual aspirations across all age groups. When reviewing and revising their reward approach, employers need to take the opportunity to examine whether how they reward their employees is appealing to older workers, as well as other groups.î
The research also warns employers not to neglect the training and development needs of older workers as this age group becomes an increasingly important part of the labour market.
Cotton adds: ìThese workers still wish to make a significant contribution to the business, have a great deal to offer and may want to learn new skills in order to do this.
ìPossibilities for rewarding an ageing workforce are endless ñ Reward and HR professionals need to consider whether they are doing enough to motivate and retain employees of all ages, otherwise, they may discover in a few yearís time that they do not have the skills and experience that they need to sustain high performance working.î
Dr Emma Parry, Research Fellow at Cranfield School of Management and author of the research adds: ìMany employers are worried that providing benefits that appeal specifically to older workers is discriminatory, but this is not the case as long as they offer the same rewards to the whole workforce. Our research shows that employees who are getting near to retirement have different needs to those at alternative stages of their careers. The total rewards package offered to employees should be designed in such a way as to accommodate these differing needs so that workers of all ages are motivated to stay with the organisation.î
Managing an ageing workforce: The role of total rewards will be launched at this yearís CIPD Annual Reward Management conference, 5th February 2007.
Employers need to do more to tempt older workers
.
