Each year the World Economic Forum publishes its Global Risks Report, which aims to outline the biggest threats facing society in the year ahead. The 2022 edition features many common sights, including climate action failure, extreme weather, and biodiversity loss. Such catastrophic events often succumb to the so-called availability heuristic, whereby we’re naturally drawn to the things we’re familiar with. In the case of the kind of threats posed in the Global Risks report, these are all risks that are commonly featured in the media, so perhaps take on added prominence in our thinking as a result.
A threat that has never been mentioned in all of the years the report has been published is the declining birth rate, yet this is a sufficient risk for Elon Musk to brand it the biggest threat to civilization at the Wall Street Journal’s CEO Council Summit.
Nowhere is this more evident than in China, where the population is set to decline for the first time since the famine of 1959-1961. This is caused by a decline in fertility rate to 1.15 in 2021. They’re far from alone, however, with Australia and the United States enjoying fertility rates of 1.6 and Japan at just 1.3.
Attitude towards age
While Musk’s concerns have an existential element to them, in the short to medium-term, it means that our societies are going to get significantly older. That carries numerous challenges with it, but nowhere more so than in the workplace.
This is especially so in the tech sector, which has had longstanding agism issues. For instance, Facebook faced a couple of suits in 2017, Google paid out $11 million to over 200 job seekers in 2019, and IBM was involved in a civil case this year revolving around the description of older workers as “dino babies”. They’re far from alone, however, and data from Stack Overflow shows that the average age of developers is between 22 and 29, with less than 7% over 45.
This would be fine if we weren’t in the midst of a widespread talent shortage. While the “great resignation” was driven by younger workers in its early stages, it is currently being driven by older, more tenured knowledge workers, with resignation rates among older workers growing by 34% in the last year.
It’s perhaps no surprise, therefore, that UN figures suggest there will be around 30 million fewer people of working age in the world’s five largest economies. That Total Jobs reveal that 80% of us are largely oblivious to this looming labor shortage does little to calm nerves either.
Aging society
With societies aging this represents a real opportunity to reverse matters. For instance, research from the European Commission suggests that the “silver economy” will be worth €5.7 trillion by 2025.
Such potential also exists in terms of the workforce. Research from the International Longevity Centre highlights the strong potential for a ‘longevity dividend’ underpinned by greater productivity as we age.
This seldom converts into the public discourse however, which tends to view aging as a burden as large numbers enter retirement and stop contributing to society, whilst at the same time drawing pensions and demanding larger shares of healthcare provision. This perception is compounded by difficulties in raising the retirement age or reducing entitlements for the elderly.
Joseph Coughlin, from MIT’s AgeLab, perhaps summed it up best when he said that longevity was “the greatest achievement in the history of mankind and all we can say is, is it going to bankrupt Medicare?”
To capitalize on this potential, we need to rethink what it means to age, as a report from the U.K.’s Government Office for Science so ably demonstrates.
“As the population ages, so will the U.K. workforce. The productivity and economic success of the U.K. will be increasingly tied to that of older workers,” the authors explain. “Enabling people to work for longer will help society to support growing numbers of dependents, while providing individuals with the financial and mental resources needed for increasingly long retirements.”
Fixing our view
Such a future has numerous challenges to overcome, however. For instance, research from the University of Gothenburg highlights the stereotypes older workers face, as they’re expected to have difficulty processing information, less interest in technology, and generally struggle to pick up new things.
This then feeds through into the performance of older workers, with research from Georgia State University highlighting how negative stereotypes undermine the physical and mental performance of older workers, such that the stereotypes become self-fulfilling.
It’s perhaps no great surprise that research from the University of Basel finds that such an environment makes older workers feel excluded from the workforce.
Missing out
Of course, these stereotypes are not founded on any kind of real evidence. Research from the IZA Institute of Labor Economics highlights, for instance, how older people are just as capable of learning new things as their younger peers. The study finds that people who are close to retiring are just as interested in learning new skills as their younger peers, even if there is no strict need for them to do so.
Similarly, there is no evidence that older people are any less creative or entrepreneurial. In fact, quite the opposite is true. Recent research from MIT and Northwestern University highlights how older entrepreneurs can often be more successful than their younger peers.
The research reveals that entrepreneurial success for the under 25s is as rare as a lesser spotted unicorn. Success rates then increase later in one’s 20s and don’t decrease even into one’s 50s. Indeed, the authors note that the average age of company founders in the United States is a veritable 41.9 years of age, with the highest-growth startups being founded by entrepreneurs with 45 years under their belt. What’s more, a 50-year-old entrepreneur was 1.8 times more likely to achieve high growth than a founder in their 30s.
What’s more, research from Flinders University highlights how older workers are often crucial for surviving the kind of turbulence that we’re currently experiencing.
“Mature adults demonstrate considerable resilience,” the researchers say. “The aspect of role modeling resilience is an especially important influence on younger workers. It includes mature coping strategies, emotional intelligence and empathy—and these attributes have never been more important in the workforce.”
An age-friendly workplace
Research from Ohio State University’s Fisher College of Business explores how organizations can encourage older workers to stick around long enough for that knowledge to be retained. The analysis found that the type of work environment was key, with autonomy, information sharing, a range of developmental opportunities, involvement in decision-making, and good compensation and benefits typifying the kind of environment that appeals to older workers.
This was built upon by a second study, from Massey Business School, which involved a survey of nearly 1,250 New Zealand workers over 55 years of age, and four key factors emerged in helping organizations retain and engage older workers:
- Provide more flexible working arrangements
- Train managers and recruiters to both identify and overcome potential age-related biases
- Champion a more positive attitude towards older workers, especially among senior management
- Provide mentoring programs between older and younger workers
This can only be achieved if HR departments have a profound shift in mindset, however, and begin to appreciate the tremendous asset older workers can be in the workforce of today.
“We need HR departments to realize that the greatest opportunity to grow their talent is not out of college, it’s out of college,” Chip Conley, founder of the Modern Elder Academy says. “We also need to recognize that if we treat older employers like their learning and development is done by the time they’re 40, it’s no surprise that we have older employees who are not as curious, so we need to learn to invest in long-term employees.”
The older workforce can clearly be an asset, not least as we weather the storms facing us at the moment, but if we are to realize that asset, we will need to rethink our assumptions about older workers and actively work to break down the many stereotypes they face.
