The Future of Work Depends on Age Diversity


The The Future of Work Depends on Age Diversity

A lot has been written about the evolving Future of Work. But a key dimension is receiving less attention. What role will an age diverse workforce play in the future of work?


There are compelling trends showing that smart, progressive companies are beginning to recognize the power of age diversity – and showing promising results. In organizations, it is said that everything starts at the top. And the top leaders are getting the importance of age diversity in the workplace. A survey of 6,000 business leaders in 36 countries found that 83% see an age diverse workforce as critical to the growth and success of their companies.1 In an Annual Corporate Director’s Survey by PwC of almost 900 board members, 90% reported that they believed age diversity was very important or somewhat important in creating diversity of thought. 2 And the diversity of thought generated by diverse teams isn’t just a polite “nice to have’. It can deliver results. A survey of 700 companies in eight countries looked at six dimensions of diversity, including age, and found that companies with above average diversity also have higher innovation revenues.3



The Reality of Demographic Drivers


Older workers are an increasingly vital part of the labor force. The Bureau of Labor Statistics projects that by 2030, 32% of the workforce will be 65 to 74, and another 11.7% will be 75 and over.4 In 2020, there were 140 million people in the US over age 45 and 30-40% of them are working. The labor participation rate is increasing fastest for people ages 65-74. 5 And the over 60 population is the healthiest, best educated, longest lived and most tech savvy of any prior age cohort.



It’s Not Personal, It’s Just Business


Understanding older consumers is an increasingly important priority in many industries. The reason is clear. Older adults have strong purchasing power, estimated at $15 Trillion in the US. And the long-anticipated generational transfer of wealth is underway, which is estimated to be over $60 Trillion. Marketing to this segment can be enhanced by a mixed-age approach.6


Major Challenges


Diversity & Inclusion Policies and Strategies Lag Behind


Despite the benefits of an age diverse workforce, there’s a major gap. And one that’s easily solved. A study found that 64% of firms surveyed in its Annual Global CEO survey had diversity and inclusion strategies, but only 8% of those included age.7 It’s time for that to change. If companies are truly interested in diversity, excluding a sizeable segment of the workforce won’t cut it in today’s edition of the war for talent.


Ageism Among Hiring Managers Is Problematic


Subjective, internalized ageism is widespread and embedded, and it affects both young and old - and those in between. Employers (through their HR staff and protocols) overlook applicants based on their age rather than their qualifications. The COVID pandemic has amplified ageist stereotypes – spotlighting vulnerability and disability – increasing age segregation. And the economic injustice it can create is denying the “good life” to many younger and older workers –reducing career opportunities and livable salaries.


According to a 2021 study 8 by Generation (a non-profit arm of McKinsey, in seven countries across four continents), fewer than 20% of hiring managers said they thought older workers had the best experience (based on education, prior work, and technical skills) and only 15 % said that workers 45+ were the best fit for their organization.

And many surveyed admitted ageist views:

> 36% cited a reluctance of workers 45+ to try new technologies

> 27% saw older workers as unable to learn new skills

> 21% believed older workers have difficulty working with other generations

However, the good news is the survey revealed that the very same employers acknowledge that once they do hire older workers over 45, they perform on the job just as well as - or even better - than those 10 years younger.


Educational Obstacles


From a bigger picture perspective, the educational system creates several obstacles for achieving a multigenerational workforce. The K-12 system is siloed from the higher education system, which is siloed from the workforce training system.

There is a lack of access at any age to individualized vocational guidance that is continuously updated to reflect changing labor market trends and job market needs. Similarly, there are limited routes to upskill or reskill to apply for skills-based hiring. Many adults have experience in the workforce, but lack formal educational credentials, such as a four-year degree. They often have difficulty translating the value of their experience and stating what they can do in language the labor market can understand.


Industry Trends


Labor shortages and retention challenges are being felt across several industries. The different growth trajectories in different industries may present special challenges, or opportunities, for an aging workforce.


Growing:

  • The Leisure and Hospitality sector is projected to grow the fastest among all sectors over the 2020–30 decade, largely driven by pandemic recovery.

  • Healthcare and social assistance employment is projected to add the most jobs of all industry sectors (~3.3 million jobs over 2020–30). The large increase is driven by rising demand for the care of an aging baby-boom population, longer life expectancies, and continued growth in the number of patients with chronic conditions.

  • Strong employment growth is expected in professional, business, and scientific services industries driven by technological advancements.


Shrinking:

  • Retail trade is projected to lose 586,800 jobs over the 2020–30 decade, the most of any sector.

  • Manufacturing contains 11 of the 20 industries projected to have the most rapid employment declines from 2020-2030. Factors include continued global competition and adoption of productivity-enhancing technologies, such as robotics.



Solutions



How can your company cultivate and harness the power of a multigenerational workforce?


  1. Make a Statement – Ensure that your organization’s Diversity, Equity, Inclusion, and Belonging strategies are truly inclusive of age diversity. They are simply not inclusive without it.


  1. Revamp Training and Education - Promote programs that reframe aging and bridge to employment, including reskilling and upskilling, and vocational guidance for all generations. Showcase experienced workers and the work-ready attributes of older workers. Leverage Employee Resource Groups (ERGs) and local community recognition programs such as certified Age Friendly Employer Awards - focused on shifting employers’ negative attitudes about hiring older workers. Develop tools such as the Skills Compass to assess in-demand skills, a standard format for online portfolios, and experiential learning opportunities such as “midternships “for workers to try out new vocational pathways. Ensure that older workers have access to training and lifelong learning opportunities. They are too often left out.


  1. Highlight Multigenerational Teams – Publicize their work and achievements externally and internally. Promote the proven advantages of an age diverse workforce by showing how all workers tend to thrive in their welcoming multigenerational workplace.


  1. Update Your Policies on Flexible Work – Flexible work programs are more important than ever and are valued by workers across generations. However, sometimes they were developed with only younger workers in mind. Reposition flexibility as a powerful tool to attract and retain valuable, high-performing workers of all ages.



In sum, the pandemic has been a catalyst for unprecedented challenges and for big changes in how we work. The demographic future is unfolding. We have a rare opportunity to build on change by re-imagining the workforce. Tackle ageism

head-on, tap into the best talent that each generation has to offer, and unlock the potential of multigenerational teams.



1 Terrell, K. (2020, August 5). Employers Worldwide Often Exclude Age from Diversity Policies. AARP.com. https://www.aarp.org/work/working-at-50-plus/info-2020/employer-age-diversity-survey.html

2 (2017). PWC Directors Survey: 90% Say Age is Important to Diversity of Thought. Next Gen Board Leaders.com.

https://nextgenboardleaders.com/insight/pwc-directors-survey-90-say-age-important-diversity-thought/

3 Lorenzo, R. and Reeves, M. (2018, January 30). How and Where Diversity Drives Financial Performance. Harvard Business Review.

4 Bureau of Labor Statistics. Employment Projections and Occupational Outlook Handbook News Release

5 Older workers: Labor force trends and career options : Career Outlook : US Bureau of Labor Statistics


6 Clinton, M. (2022, January 24).The Profound Effect of Americans Leading Longer Lives. Esquire. https://www.esquire.com/lifestyle/money/a38859723/the-new-retirement/

7 Callaham, S. (2019, July 25). The One Critical Element Missing From 92% of Diversity and Inclusion Strategies. Forbes.

8 Mourshed, M., Jaffer, J., Cashman, H., Salazar Ruiz, K., & Sikes, J. (July 2021). Meeting the World’s Mid-Career Moment. Generation (a non-profit arm of McKinsey).