By the year 2050, it is expected that the number of people above the age of 60 will double. This has been defined as ‘the financial equivalent of climate change’ by The World Economic Forum and will haunt the future generation if left unaddressed.
One of the significant consequence is that everyone will have to work for a longer time-span. That was the motivation behind PwC’s Golden Age Index, which analyses how well the power of workers over 55 years of age are being harnessed by the OECD countries. As per the latest reports, there is a mix of lost opportunities and steady progress; if each of the OECD country enhanced its above 55 employment rate to the rate of Sweden (where nearly 75% of people between the age of 55 and 64 are employed), the GDP gain in the long run could reach up to $2trn.
The report clearly states that firms are missing out a valuable sector of the workforce and this is especially true in case of older women. A noteworthy gender gap exists in numerous countries between the number of female and male over-55s in work. Among all the OECD nations, Finland has the best record for uniformity between the number of female and male above the age of 55 in work. The UK, on the other hand, has about 63.4% of women aged 50 to 64 in employment whilst for men, this percentage is 75.4%. Also with the increase in age, the gender based pay gap also increases.
There are numerous reasons for this, but the end results is that the labour markets experiences of older women are often characterised by lower pay, higher barriers to entry and more part-time work compared with men of the same age.
This feels nothing less than a loss of opportunity. There is numerous evidence pointing towards the fact that unique human skills like, emotional intelligence, as well as, adaptability are increasingly becoming more valuable and essential in this modern age of machines. In a study, PwC found that the ‘strategic’ leaders who are highly effective in implementing change tend to have attributes such as, resilience and humility of perspective, that are most commonly seen amongst women and over 55s. Skills naturally developed by women over the course of lives at home and at work, such as crisis and time management, people skills and empathy are what firms are proactively looking.
According to the Golden Age Report of this year, the governments are making steady progress in eliminating the employment obstacles faced by the older generation. However, the challenges in the field of recruitment and training still prevail. This means that the governments and organisations have to work very closely together if they want to harness the traits and talents possessed by older workers and under-employed groups. This includes careful thinking about the policies that will motivate older women to stay at or return to work.
Flexible work policies are essential. When PwC compared the Golden Age index of this year against that of their Women in Work Index, they found a positive correlation suggesting that flexible working policies help to incentivise women to be in work for a longer period of time. Training targeted at older workers is also crucial. PwC concluded that they can go further. Financial incentives can lead to attract women who have a gap in their pension contributions. It could also act as ‘returnships’ for those who have been away from employment for a considerable amount of time.
Also, there is a need to recognise that there are scopes of learning throughout one’s life and it does not stop at the age of thirty. It is not a coincidence that Iceland, the country holding the top ranks of the Golden Age Index, possesses a state-funded, comprehensive and lifelong learning programme in place, which works excellently. One in every 3 women in Iceland graduates from tertiary education post-30. This is in contrast to one in 10 in the OECD countries.
It clearly seems that employers are losing out on a valuable source of talent for the present age of automation. If it is about making a small adjustment in the policies of your employment, there is no need to wait anymore.
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