The ageing workforce: time for a more strategic data-driven approach?

Blog posts

7 Oct 2022

Dan LucyDan Lucy, Principal Research Fellow

The pandemic has exposed a gap in HR strategy when it comes to older workers

Since the start of the pandemic we have seen an exodus of older workers from the labour market. Importantly, this has been a reversal of a long-standing trend of increased participation. In other words, something has changed. Clearly Covid-19 is a big part of that ‘something’, but it may also be that a long-standing gap in HR strategy has been exposed.

We have known about our ageing workforce for a long time, and the fact that it is almost certain to be a prominent feature of our future workforce for years to come. It should, by all metrics, be a key focus of current and future HR planning and strategy, but with some notable exceptions it hasn’t been. Previous research by the Chartered Institute for Personnel and Development (CIPD) reported that HR professionals were most likely to say that they deal with issues relating to an ageing population as they arise, rather than having a strategy. So, what should HR be doing to incorporate the ageing workforce into its HR strategy?

In a tight labour market, older workers who would consider returning to work for the right job are a potential source of untapped talent

Figures from IES’ latest labour market briefing based on ONS data suggest over 600,000 older workers have left the labour market since the start of the pandemic. Of these, a significant proportion (58%) say they would consider returning to work. In the context of the tightest labour market in 50 years and the recruitment challenges being faced by employers, that is a potentially very valuable labour resource. The most common factors older workers consider when choosing to return were flexible working hours, good pay, the ability to work from home as well as a job that fits around caring responsibilities.

So, whilst pay is an important factor, there is clearly a desire for a job to suit their needs and situation. Equally illustrative may be the reasons given by older workers for leaving the labour market in the first place. For those aged 50-59, whilst retirement was the main reason given, stress and mental health, illness or disability, and not feeling valued in one’s job, all featured. Clearly, leaving for reasons of stress, ill-health or simply not feeling valued are strong signals that work is not the accommodating or enriching experience it should ideally be. In other words, both the reasons for considering returning to work, and the reasons why older workers say they left work, are signs that work is not meeting the expectations or needs of older workers. Put another way, if employers can offer the right type of job, they could have the interest of an available and skilled segment of the workforce.    

A strategic approach is needed based on understanding older workers needs and shaping jobs to fit

The challenge is to think of this not as a solely tactical task worthy of a shift in focus around resourcing efforts, but more a strategic objective involving understanding the experiences of older workers and taking steps to review and enhance their experience of work. There has been a longstanding mismatch between what older workers want from work, and what they typically receive. For example, recent analysis by the CIPD showed a clear relationship between age and perceptions of career progression opportunities, with increasingly older workers feeling less positive about their opportunities. The same analysis demonstrated declining off-the-job training (off-the-job as this is considered a greater signal of investment in an individual) with age. This conflicts with other research showing that what older workers want from work is really very similar to what other age groups want, including opportunities to learn and develop. In essence, there is a need to really think beyond current resourcing difficulties and the opportunity of luring older workers back to work, and rather see this as an opportunity to think and act more strategically in relation to age. An approach which is likely also to bear fruit as the share of the workforce in their 50s and upwards is anticipated to grow. So, what should HR be doing?

A three-step approach is needed that takes an employee lifecycle, data-driven and agile approach to make work age-inclusive, now and in the future

  1. Take a data-driven approach to understand the age profile of people who enter, progress and leave your workforce, and any challenges you may face in attracting, recruiting and retaining older workers. Supplementing any quantitative analysis with more qualitative insights on how older workers experience work, challenges they face, their needs and aspirations are critical steps to redesigning work and the workplace to meet their needs.
  2. Conduct a strategic review of HR strategy, policy and practice informed by insights from a data-driven approach, but also drawing on learning and best practice from other organisations that successfully attract, recruit and retain older workers. Whilst the available evidence would suggest HR strategy hasn’t tended to focus enough on the experience of older workers, there are nonetheless examples of good practice to draw on in terms of the kinds of initiatives that can bear fruit. It will be useful to look both across the employee lifecycle but also deep dive into particular areas of HR policy and practice, whether that be recruitment, careers or other areas. In designing the approach taken, iterative and agile approaches are likely to work best through collaboration with older workers in design, development and testing.
  3. Evaluate impact, continually listen, and refine your approach in response to the evolving needs and experiences of older workers, ensuring your approach meets their needs as times inevitably change.

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