SINGAPORE prides itself as a nation with one of the highest employment rates for people aged 65 and over. The Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) and other agencies have been actively promoting the redesigning of jobs and reskilling for older workers as ways for companies to mobilise the growing pool of "silver" talent.
The need for institutional intervention to support this cause has been exacerbated with the rapid automation of jobs as we know them.
Marsh & McLennan Companies' Asia Pacific Risk Center (APRC) estimates, for example, that Singapore's aging society could result in losses of US$3.3 billion in GDP (1 per cent of total) due to sickness absenteeism.
In our latest research, we have attempted to understand the confluence of aging and automation across 15 countries, and the resulting impact on older workers. The world runs a serious risk. In an environment where the demand for particular kinds of labour is diminishing, older workers skilled in the work of yesterday might be at risk of being excluded from the economies of tomorrow.
We found that countries with higher rates of projected aging tend to also have larger proportions of older workers at risk from automation. The risks are particularly pronounced across Asia, as well as in parts of Europe such as Germany and Italy. These are countries where older workers are largely employed in widely "automatable occupations" which entail repetitive tasks.
Older workers tend to face unique difficulties in the labour market - such as high long-term unemployment and age discrimination - and so are prone to particularly harsh fallouts from displacement by new technologies.
Concerted efforts on the part of governments and companies to devise strategies for encouraging and accommodating the older worker will be crucial in the coming decades.
A more proactive approach which values the experience and ethos of the older workers and educates the younger workers around inherent unconscious biases against older workers is needed.
As we see the future of work shift towards tasks which require higher cognitive complexity, the emotional intelligence of older workers can be harnessed to better manage the people side of digital transformation.
We examine the implications along four dimensions:
- Education: Unlike in industrial transitions where the relationship between productivity and skills was linear, digital transition would entail a much steeper learning curve especially for older workers. Older workers can provide crucial abilities for firm building, knowledge consolidation, and continuity in times of flux. An age-diverse workforce can reduce costs by increasing organisational commitment and reducing staff turnover. Investing in older workers therefore through firm retraining programmes and older worker accommodation strategies would help older workers reskill and be redeployed in the workplace, and provide firms with a fresh source of vitality in a world of shrinking young labour forces.
- Thinking "tasks" over "jobs": The traditional frameworks of defining jobs become less relevant by the day. To protect people over jobs, and meaningfully employ older workers, companies will need to undertake a redesign of "jobs" or "roles" in light of two aspects - the degree of automation achievable on the one hand, and the skills needed to perform the remaining human tasks on the other. Breaking down jobs or roles into "tasks" or "projects" would allow for companies to have a more holistic approach to deploying older workers in ways that are productive and sustainable.
- Public spending and welfare: In countries with more government consumption spending and higher pension replacement rates, older workers tend to be doing higher-skilled work. While this may have been because richer countries tend to have better public spending systems on welfare and pensions, higher-skilled older workers tend to be in the workforce for longer as their employment income exceeds their retirement income. Incentives for reskilling and improved safety nets can motivate older workers to embrace the idea of lifelong learning and lifelong employment.
- Legal rights in financial systems: In countries with better legal protections for borrowers and lenders, older workers are less likely to be at risk of automation and more likely to be in higher-skilled work on average. This could be because older workers are more likely to be able to start their own businesses. In countries with better access to new company financing, older workers are more likely to start small businesses in their old age, and therefore maintain "manager" or "professional" status as an older worker in a high-skill, less automatable profession.
Companies have much to benefit from investing the productivity gains from automation into their human workers - particularly older ones, who are more and more willing and able to remain in or re-enter workplaces around the world.
Contrary to conventional opinion, older workers can actually be a reliable treasure trove of experience, adaptability and productivity given the right environment and opportunities. Researchers have found, for example, that older workers tend to outperform younger workers in semantic memory, and language and speech skills. Older workers also tend to be more resilient amidst change, and score higher on EQ (emotional intelligence) required to manage tensions at work.
With more and more older persons re-entering and remaining in the workforce in Singapore and around the world, businesses would do well to devise strategies for harnessing the many benefits they have to offer.
There may be a real "silver lining" to giving "Silvers" a real chance at success in this age of disruption. Enabling them to thrive is positively contributing to the nation's future.
- The writer is a partner and regional business leader for Career Business at Mercer