Our society is experiencing a demographic revolution with people living and working longer. The latest statistics from the Office for National Statistics project that more than 24 per cent of people living in the UK will be aged 65 or older by 2042, up from 18 per cent in 2016.
I believe this is leading to a profound shift in the workplace. Not only are companies’ workforces ageing, but increasingly organisations are seeing multiple generations working together, with employees in their 20s and 30s through to those in their 70s and even 80s.
As the workforce ages, balancing everyone's needs is going to be one of the biggest challenges facing businesses in the future. It’s going to mean changes to the way organisations recruit, evaluate performance and remunerate staff, as well as changes to what training and benefits are offered and the kind of working hours that are considered standard.
But there are also opportunities to consider. Organisations need to find ways to help everyone work together in a productive way – and in this way, gain the full benefit of a multigenerational workforce. For example, how can companies help older workers transmit the knowledge and experience they have gained over decades to their younger colleagues? In turn, how can companies encourage younger colleagues to share their unique knowledge with older generations?
There are no easy answers. But the key is to actively manage the issues around an ageing workforce. Unfortunately, the reality is that most companies today are barely thinking about these issues.
The Centre for Ageing Better highlighted last year that only one in five employers is discussing the ageing workforce strategically, and nearly a quarter of employers (24 per cent) admit they are unprepared for a growing number of older workers.
This needs to change. Just as businesses have had to navigate a revolution in technology that has transformed the workplace, now they need to address the demographic change happening in society.
Unless companies are on the cusp of the curve, they run the risk of emulating one of the ‘dinosaur’ businesses that failed to grasp the competitive advantages of technology. But what should they be doing? One option is to introduce flexible working, which can create a level playing field across the generations. Allowing flexible working patterns is a great way to motivate older workers, with their valuable skills and experience, to stay in the workforce.
It’s also good for younger workers who have an expectation these days to be able to work flexibly. Therefore flexible working can satisfy the needs of both older and younger workers, if introduced and managed properly.
Companies also need to ensure they create a company culture where age diversity is truly celebrated and respected. They need to help employees understand that there are enormous benefits to working in a multigenerational environment. Cross-generational mentoring programmes, for example, are a great way to share knowledge and different perspectives.
Finally, businesses should consider their employee benefits and how to attract and retain a talented workforce. There is plenty that employers can do beyond paying a decent salary, and it’s important to build a reward and benefits package that will work for the demographic of their workforce.
Understanding intergenerational differences is vital. A ‘one size fits all’ approach is no longer appropriate and companies must understand their demographic mix and segment the type of benefits they offer accordingly.
A demographic time bomb is here and businesses can’t afford to ignore it any longer. Actively managing issues around an ageing workforce is essential to ensure your company is prepared for both the challenges and opportunities of managing intergenerational teams.
Steve Butler is CEO of Punter Southall Aspire and author of Manage the Gap