Maximising the value of an ageing workforce
- 4 Min Read
With many employees working for longer, there are many companies that struggle to deal with an older workforce. John Deacon, Head of Employee Benefits at Buck, discusses how to maximise the full potential of this opportunity
The number of older workers in employment is on the rise, resulting in record high employment levels. The reasons for this trend are numerous – from macro-scale challenges such as the UK’s aging population to more personal issues, such as the rising cost of living or lack of savings.
As a result, while many businesses are busy investing in recruiting new, young talent to the company, they are likely to face challenges unless they ensure plans and initiatives are in place for these older employees too.
Balancing value, offsetting risks
There is no reason for businesses to see older workers as a problem. These staff hold a wealth of knowledge about the industry as well as the company’s processes and practices that can easily be lost when they leave. Not only that, but these employees are also likely to possess close relationships that help keep the business running – with colleagues, clients and even suppliers. These benefits are a direct result of having spent years in the role and are vital to keeping the business functioning smoothly.
Of course, not every employee working past the retirement age will bring these advantages, as those who remain in the company unwillingly are likely to struggle. The reason that some older employees continue working is simple enough; in many cases, they don’t have the savings they need to retire comfortably and therefore need to stay employed in order to bolster their savings. But while the cause of this problem may be easy to see, finding a solution is often more difficult.
Seeing finances positively
To address this issue, businesses need to consider what role they should play in supporting their employees’ financial security over the long-term. For example, many businesses provide a basic pension scheme and nothing more, which is rarely enough to provide a comfortable retirement.
Wellness has become a growing priority for organisations, yet many businesses totally overlook the role that employees’ finances play in their wellbeing, which means that staff may suffer from stress as a result. Some businesses may not feel that they have any responsibility here – after all, one could argue that employee savings are the individual responsibility of each member of staff.
However, by providing training, advice and benefits that support their older employees’ financial wellbeing, the company will not only see a rise in staff engagement but will also futureproof the business against the potential pitfalls of an aging workforce.
Making it work
In practice, businesses need to incorporate two different elements into their wellbeing strategies in order to cater for their older workers. First, they can consider a number of lifestyle initiatives. For example, encouraging these employees to work flexibly, remotely or even adjusting their role to part-time will limit the inevitable dip in motivation and engagement that staff in this position often experience.
Encouraging junior members of staff to support these employees will also allow a smoother transition when these older workers retire. Younger staff will feel more motivated too, as they will have more responsibility and the opportunity to step into a more senior role once the employee has left the business. As a result, the company can successfully manage both age groups and their respective career goals.
That is the second element that businesses need to consider when it comes to wellbeing: ensuring that younger staff are also prepared for retirement. Providing training sessions on financial wellbeing, offering suggestions for longer-term investments or even giving the team access to a financial adviser can give every employee the information they need to save for their retirement.
Businesses can support these initiatives by offering practical ways to save as well, such as season ticket loans or by arranging employee discounts on various products or services. This way, staff will not only know how to save, but will also have the extra money they need to do so.
While these practices will not immediately reduce the number of employees unable to retire, it will provide a healthier longer-term strategy for the future. Ultimately, with these initiatives and training in place, employees will establish good financial habits from the start of their career, rather than leaving it too late.