UK employers need to prepare for an ageing workforce as three-quarters (78%) of employees anticipate working beyond 65, warns Aon Consulting, a leading pension, benefits and HR consulting firm. Only an estimated one million are currently working past state pension age but this is expected to treble amongst people aged 65-70 by 2017.
Aon Consultingís research found that a quarter of respondents would carry on working past the official retirement age simply because they wanted to, whereas 53% believe it will be necessary to increase their pension. Regionally, Newcastle workers were most committed to topping up their pension (57%) while less than half (49%) of Scottish employees were least willing to carrying on working to achieve this.
Consequently, UK employers need to address the new risks posed by an ageing workforce, including:
ï Legal implications
With workers now protected against discrimination, it is potentially a minefield for employers and they must tread carefully. For example, consideration must be given when choosing criteria for redundancy selection and employers cannot, on the grounds of age, deny employment, refuse to provide training or retire someone early without objective justification.
ï Information Technology
Organisations must be prepared to devote more resources to IT training, especially up-skilling their older workers. For the older workers themselves, if they have been able to avoid embracing technology until now, they will have to do so if they want to continue to have intellectually stimulating jobs.
ï Motivation
Aon Consulting found that 53% of those 65 and over were only continuing to work in order to boost their pensions. With this mindset, employees could be resentful about their need to continue working, which is not conducive to good job performance. Employers will need to focus on maintaining motivation by ensuring that older workers are given interesting and fulfilling jobs and full access to the training they need.
There are many positive aspects to having an older workforce. Older workers are more reliable and take less time off for sickness with UK 2004 data showing average absence rates of 2.4% for workers aged 60 and above, compared with 3% for the 25-34 age group (Office of National Statistics). They are also more likely to have a more responsible attitude to work than their younger colleagues and their extra work and life experiences make them ideal to perform mentoring roles.
Jon Beaumont, HR Consultant at Aon Consulting said: ìAn ageing workforce is inevitable with an estimated three million people likely to be working beyond their retirement age within 10 years time. This could be a huge benefit to organisations, so long as the key challenges are tackled sooner rather than later. Businesses used to think that older workers could not drive companies forward but this old fashioned attitude needs to shift.
ìAge should not be seen as a barrier. There is a vast pool of mentally agile people, with great work and life experience over the age of 60 and industries will be missing a trick if they do not capitalise on their productive potential. Effective performance management will be the key discipline in making an ageing workforce into a competitive advantage.î
Aon Consultingís research surveyed 1,204 working adults across the UK about their attitudes to retirement.
Figure based on statistics from the Office of National Statistics and Aon Consultingís calculations.
UK Employers Face Trebling of Ageing Workforce By 2017
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