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					                                             www.monash.edu


          Older workers in an ageing society


Professor Philip Taylor
Director of Research and Graduate Studies,
Monash University, Gippsland Campus



 ERA Virtual Seminar Series
 September 2010




                                             www.monash.edu
                                             www.monash.edu



  Content
• Examines changes in work and retirement against a
  background of population ageing.
• Reviews the status of policymaking concerned with age
  and employment and how this needs to be adapted to
  align with the needs of different individuals and societies.
• Considers trends in the employment of older workers, how
  policymakers are envisioning a flexible end to working life
  and their prospects of success.
                                           www.monash.edu


  Older workers in context
• To understand the present situation of older workers some
  context is required.
• Policy development since the late-1990s has been the of
  prolongation of working lives, presented as a means of
  reducing pressures on social welfare systems.
• Contrasts with previous approaches which focused on the
  need to remove older workers from the labour market in
  response to high unemployment.
• In the 1980s and 1990s the restructuring of industrialised
  economies was accompanied by a dramatic fall in labour
  force participation among older workers.
                                                         www.monash.edu


The labour market and older workers
 • Research points to the disadvantaged status of older workers
   in the labour markets of the industrialised economies. Their
   position is summarised in a review of OECD countries:
     – Labour market mobility in terms of new hires is lower for older
       workers.
     – While rates of job loss are similar for younger and older workers,
       the latter are more prone to experience long-term unemployment.
     – A shift to economic inactivity is generally permanent across older
       age groups (OECD 2006).


 • On the other hand, after decades of increasingly early labour
   market withdrawal, important changes have been underway.
                                                                              www.monash.edu


Employment/population ratios, men and
women aged 55-64, 1979-2008
                                       Men                                        Women

                  1979   1983   1990    1995   2000   2008   1979   1983   1990     1995   2000   2008

    Australia     67.4   59.6   59.2    55.3   58.3   65.7   19.8   19.9   24.2     27.4   35.3   49.1

    Finland       54.3   51.4   46.3    34.9   43.7   57     39.0   44.1   39.7     33.1   40.9   55.8

    Germany       63.2   57.4   52.0    47.2   46.4   61.7   26.8   24.0   22.4     24.4   29.0   46

    Netherlands   63.2   46.1   44.5    39.9   49.9   60.2   14.0   13.2   15.8     18.0   25.8   41.1

    Japan         81.5   80.5   80.4    80.8   78.4   81.4   44.8   45.1   46.5     47.5   47.9   51.7

    UK            -      64.3   62.4    56.1   59.8   67.7   -      -      36.7     39.3   41.4   49

    USA           70.8   65.2   65.2    63.6   65.7   67.7   40.4   39.4   44.0     47.5   50.6   57

    EU-15         -      -      52.3    47.2   48.9   56     -      -      24.3     25.6   28.4   38.9


   Source: OECD Employment Outlook (various)
                                               www.monash.edu


 New consensus on ‘active ageing’
• Emerging consensus around the notion of ‘active ageing’,
  defined by the WHO (2002) as ‘the process of optimizing
  opportunities for health, participation and security in order to
  enhance quality of life as people age’.
• According to the OECD (1998), this requires:
    emphasising prevention, making policy interventions at an
     earlier life stage, reducing the need for later remedial action
    less fragmented actions, concentrated at critical transition
     points in life
    and enabling less constrained choices and greater
     responsibility at the level of individuals.
                                              www.monash.edu


  Considering the life course from an labour
  market perspective
 Destandardisation of transitions from school to old age.
 Changing skill demands and greater emphasis on ‘employability’.
 Labour market deregulation :
   Decorporatisation of industrial relations.
   Volatile labour market dynamics.
   Core/periphery employment and the casualisation of work.
   Internal labour markets versus contractual work.
 Changing institutional frameworks.           www.monash.edu
                                                       www.monash.edu


  New policies for older workers
Policy measures include:
    – Closure of or limits on use of early retirement pathways
    – Increasing retirement ages
    – ‘Active’ labour market measures
    – Rewards for pension deferral
    – Ending mandatory retirement
    – More flexible approach to retirement e.g. gradual retirement.

But, mixed evidence on the success of the various measures e.g.
    – Ending mandatory retirement appears not to have been effective.
    – Gradual retirement schemes appear to have had limited influence,
      although early days in terms of evaluation.
    – Gradual retirement schemes may even have promoted early retirement.
    – Evidence of creaming, deadweight effects and occupational
      downshifting.
                                            www.monash.edu


Flexible retirement or inflexible working?
• Surveys find that older workers are willing to work on if they
  can reduce or work flexible hours.
• But what are the realities of flexible working?
• Flexibility may benefit some, but for others a gradual switch
  from work to non-work is not an option.
• Data suggestive of significant constraints on older workers’
  choices.
• Singular public policy position of one-way transitions from
  full-time to part-time work and on to retirement is misguided,
  perhaps driven by ageist assumptions.
                                                                                                                  www.monash.edu



                                            Underemployment Rates: Australia
                                                                     Males by Age
                                                         Source: Australian Bureau of Statistics



          14

          12
                                                                                                                                  M 15 - 24
          10
                                                                                                                                  M 25 - 34
Percent




           8
                                                                                                                                  M 35 - 44
           6
                                                                                                                                  M 45 - 54
           4                                                                                                                      M 55 and over

           2

           0
           Quarter 1978




                          Quarter 1983




                                         Quarter 1988




                                                           Quarter 1993




                                                                                Quarter 1998




                                                                                                   Quarter 2003




                                                                                                                   Quarter 2008
            February




                           February




                                          February




                                                            February




                                                                                 February




                                                                                                    February




                                                                                                                    February
                                                        Quarter / Year
                                                                                                                       www.monash.edu


                                                        Underemployment Rates: Australia
                                                                         Females by Age
                                                              Source: Australian Bureau of Statistics



          18

          16

          14

          12
                                                                                                                                         15 - 24
Percent




          10
                                                                                                                                         25 - 34
           8                                                                                                                             35 - 44
                                                                                                                                         45 - 54
           6                                                                                                                             55 and over

           4

           2

           0
           Quarter 1978




                          Quarter 1983




                                         Quarter 1988




                                                                  Quarter 1993




                                                                                         Quarter 1998




                                                                                                        Quarter 2003




                                                                                                                          Quarter 2008
            February




                           February




                                          February




                                                                   February




                                                                                          February




                                                                                                         February




                                                                                                                           February
                                                             Quarter / Year
                                                                                   www.monash.edu



                45
                40
                35
                30
      Percent




                                                                                   1 to 12 Weeks
                25
                                                                                   13 to 51 Weeks
                20
                                                                                   52 Weeks and Over
                15
                10
                 5
                 0
                     15 - 19   20 - 24    25 - 34   35 - 44   45 - 54   55 years
                                                                        and over
                           Age Group / Duration of Underemployment


Australian Underemployment Rates by Duration. Men by Age (Australian
Bureau of Statistics)
                                         12
                                                                                      www.monash.edu



                60

                50

                40
      Percent




                                                                                       1 to 12 Weeks
                30                                                                     13 to 51 Weeks
                                                                                       52 Weeks and Over
                20

                10

                 0
                     15 - 19      20 - 24    25 - 34   35 - 44   45 - 54   55 years
                                                                           and over
                               Age Group / Duration of Underemployment


Australian Underemployment Rates by Duration. Women by Age (Australian
Bureau of Statistics)
                                            13
                                       www.monash.edu

 Summary
• Policymaking has had a singular focus on delaying
  retirement, ignoring the the diversity of older people’s
  lived lives.
• Narrow economic imperatives are overriding wider
  social ones such as the work/care nexus.
• Neglect of such scenarios risks exposing older
  people to the now familiar problem of diminishing
  opportunities and increasing constraints and with
  them, reduced prospects for ‘active ageing’.
                                       www.monash.edu
                                           www.monash.edu


New policies for older workers
• Realistic stance on older workers’ employment
    – Extending working lives depends on a range of individual,
      organisational, economic and societal factors and while
      this may be achievable for some, for others it might be
      remote.
• Integrated and strategic policymaking
    – Need for a matrix of public policies which respond to the
      heterogeneity of older people’s lives, not devise policy
      according to chronological age.
• Preventative
    – A shift to a life course approach, emphasising long-term
      measures.
                                                      www.monash.edu


    Summary
 Integrated and strategic approaches aiming to produce sustainable
  workforces and which move beyond a static view of older workers will:
       Support a diverse workforce to balance work and non-work
        obligations.
       Be sensitive to the need to empower workers to remain competitive
        over the long-term.
       Challenge age-based and other stereotypes, not reflect them.
       Accept that some workers’ lifecourse trajectories leave them ill-
        equipped to compete in a modern economy.
       Take the long view, planning for the older workforce of the future.
                                                      www.monash.edu
                                www.monash.edu




Thank you
Philip.taylor@adm.monash.edu.
au




                                www.monash.edu

				
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