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Demographics and the workforce - the facts, not the myths

The labour force is ageing. The number of workers aged under 35 is falling, with the fastest decreases among those aged 18-24. The number of workers aged 50 and over has increased significantly. By 2025, just 20 years away, half the adult population will be aged 50 and over.

The changes will mean some radical re-thinking by employers about their workforce, how they encourage and retain younger workers and how they value older workers, making better use of their skills and experience, and ways in which they can be encouraged to remain in work rather than leave.

Why does this change in the population have anything to do with my business or me ?

It will have a direct impact on your pool of labour. Most significantly since the 1970s, the birth rate has been very low, less than the ‘replacement rate’ and there has been an increase in the number of young people extending their education into further and higher education; and life-expectancy and health beyond the age of 60 is generally improving faster than ever before, and could continue to accelerate. This means people who have previously been considered as older workers are as capable of working as middle-aged people. These factors need to be taken into account to ensure your company remains competitive in the current climate.

So does this mean there will be no younger workers ?

No. Overall the number of younger workers will fall but this will not mean that there will be none at all. However, as an increased number choose to remain in education for longer, the supply of very young workers with few skills or clear views about what work they want, will fall markedly.

This will increase recruitment problems if employers who traditionally rely on this age group, do not adjust their recruitment to include middle-aged and older workers.

But if I keep older workers, they will block the progress of younger workers and they’ll leave. This won’t help my business to be cost effective will it ?

This was a common theme of downsizing redundancy policies in the 1980s and is one of the common myths that the number of jobs in the workforce is fixed, and that to allow one person to enter the workforce or gain promotion, another must become unemployed or move on.

It is plausible, that for an individual company, particularly a small business, such conditions could occur, but even in stable companies and sectors, this would be infrequent and wouldn’t happen every time a replacement was sought.

The fact is that research studies have found no evidence that ejecting older workers creates jobs for younger workers. On the contrary, they suggest that retaining and retraining workers not only increases staff motivation and commitment – on a wider scale, it also increases the size of the potential workforce, raises competition for jobs, restrains labour costs and wages, provides more choice for employers and increases productivity – all of which is a benefit to employers.

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Still, everyone knows that employing older workers is bad for business, they can’t learn, are always sick and are ineffective aren’t they ?

No. These are the myths and stereotypes about older workers, which are commonly circulated but have little or no evidence to support them. Indeed the evidence indicates quite the opposite.

There are changes as we age, but most of the substantial changes occur well after normal working age and are totally irrelevant to the workplace. There is virtually no evidence of a general decline in work performance with age.

It is also wrong to state that older workers are unable to learn. Evidence shows older workers are just as able to learn new or updated skills as younger workers. Yes, there can be differences in learning styles, but this is mainly to do with the contrasting education and occupational experiences of people at different ages. It is how people are trained, not their capability, that is important.

Good for business

Employing a mixed-age workforce is good for business. Employers report that the main benefits are:

• Reduced recruitment costs by increasing the pool of recruits and maximising applications.
• Improved public image by having mixed age policies.
• Commercially advantageous to have a workforce that reflects the customer base by meeting customer preferences and perceptions.
• Improved staff retention rates by opening up training, promotion and development opportunities to all; and by removing unfounded stereotypical ageist myths.
• Lower turnover costs through improved recruitment and retention procedures particularly useful in sectors where vacancies are hard to fill.
• Improved productivity through better staff morale and by having more flexible working practices, particularly in later years.
• Improved mentoring capacity by retaining those with corporate knowledge and experience.
• Maintaining a wider staff base by responding to demographic change and appreciating that previous pools of recruits are changing.
• Gaining a competitive edge and being one step ahead of competitors by maximising the potential of your own workforce and being inclusive of workers of all ages.

Related information

Age legislation - information for employers and individuals

Date: 28 Jul 06

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