Older workers

As the baby boomer bulge works its way through the workforce, with fewer and few new entrants, (in 10 years time, there will be half the new entrants to the workforce each year that there were this year) it becomes more important for companies to figure out how to make the most of their older workers. In the last couple of decades, companies have been able to put their 45+ workers out on the scrapheap, and replace them with new graduates who they can train up.

But as the labour market becomes tighter and tighter, it becomes more important for companies to make the most of all the talent they have available to them. The trouble is that companies, and workers, expect a linear path in someone’s salary. Part of the reason that graduates replaced older workers is that it was the simplest way to get the salary bill down for the work being done. The best answer would probably have been a salary somewhere in between, for the older worker, but neither the worker or the company could figure out how to make that work.

The other issue with older workers is that both the younger manager (say mid-30s) and the older worker find it hard to cope with the manager-staff relationship being a younger-older relationship. I’ve been managing people older than me for a while (probably before I was ready for it, to be honest), but the first time I was managed by someone younger than me was quite a big deal for me.

Interestingly, someone pointed out to me today, that at my company, and many other white collar companies, contracting has been the facilitator to smooth the path – both for older workers to be paid commensurate with their productivity, and for managers and staff to be happier with the relationship not to be based on age.

In one of the projects I’m responsible for, I was introduced today to someone who is about to retire when the project is finished in a year’s time. He’s working for people much younger than him. He’s adding value to the project through his deep knowledge of the industry, and (I’m speculating now) because he’s a contractor, the manager relationship is not such a big deal that either the manager (another contractor) or him has such a huge amount of emotional energy invested in who is in charge. He’s also probably not being paid as much as he was at the peak of his career.

But I think that companies have to figure out how to deal with these issues without the large human cost of redundancies and contracting – there is a lot of emotional cost there, and also wasted time in recruitment, training, and down time for the contractors who don’t especially want three months off in between jobs.

There are no big policy issues here, but changes in mind set are needed. Managers need to feel comfortable managing people much older than them. Older workers need to feel comfortable being managed by young turks. And everyone needs to figure out how to move people to lower responsibility jobs with dignity as they move towards the end of their career.