Dive Brief:
- To sustain their workforces as labor demographics skew older, employers must foster age-inclusive work environments and tailor benefit packages to meet older employees’ needs, according to an October report by Bank of America and the Global Coalition on Aging.
- Examples of benefits that best support older workers’ needs include: Flexible work and phased retirement options, caregiving and grandparents’ leave, menopause support, and assistance with financial and health care literacy, according to the report, which was shared with HR Dive on behalf of Bank of America.
- To cultivate an age-inclusive workplace, managers should focus on ways to engage multigenerational teams and promote the sharing of knowledge and expertise, the report recommended. Companies can do this by being open to employing older workers instead of dismissing them as overqualified, and fostering collaboration and two-way mentoring between older and younger workers.
Dive Insight:
The aging workforce is a trend that consultants and academics have watched with interest for some time.
Six years from now, workers 55 and older will comprise a quarter or more of the the workforces in G7 countries (U.S., Canada, U.K., Germany, Japan, France and Italy), a nearly 10% jump from 2011, according to a July report from global consultancy firm Bain & Co.
In the U.S., workers already skew older. As of 2023, adults aged 65 and older made up nearly 30% of the American workforce, a jump from 23% in 2000, the Employee Benefits Research Institute reported in the spring.
Given the shift, now is the time to “let go of generational stereotypes, focus on employment factors that matter across all ages, and take a nuanced approach to understanding how different factors interact and affect each individual’s decision to stay or go,” the report emphasized.
Combating ageism, in particular, makes business sense, BofA and GCoA said. Ageism against those over 50 cost an estimated $850 billion in 2018, they pointed out.
That said, strategies providing benefits which factor in age and individual needs are key to productivity and retaining workers, the report stated: 60% of employees say their benefits package makes them feel more valued, and 80% choose additional benefits over total compensation, research by BofA and GCoA found.
Benefit packages tailored to older workers are especially important because they allow older workers to work longer and prepare for retirement on their own terms, the report said.
For many employees, this is critical. Nearly 60% of U.S. workers at mid- and large-sized companies lack confidence in their financial ability to retire at the typical age (65 to 67), according to a recent survey by Economist Impact and TIAA subsidiary Nuveen. The sentiment was stronger among Black, Hispanic and Asian workers, compared to White workers, the firms said.
Flexible work and phased retirement are two win-win options, BofA and GCoA pointed out. These options provide older workers with additional financial support and allow them to stay engaged longer, while enabling employers to continue to benefit from their experience and expertise, the report explained.
Career extension — offering employees opportunities to expand their responsibilities within their current roles — is another mutually beneficial option, the report noted. In this respect, career extension has been associated with higher job satisfaction, increased engagement and better employability among older workers, it said.
However, one demographic faces the brunt of both ageism and sexism — older women, who experience more challenging stereotypes than their male counterparts, the report said. To address a sensitive but related issue, employers can provide menopause benefits and policies that change company attitudes toward it, BofA and GCoA suggested.
Although most adults don’t feel comfortable discussing menopause, according to a 2022 survey by Ipsos, ignoring it comes at a cost. Symptoms associated with menopause add up to $1.8 billion in lost work time each year in the U.S., a Mayo Clinic study found.
Women also bear the brunt of caregiving, making up 75% of the caregiving demographic, the BofA/GCoA report said.
Caregiving can require as many hours as full-time work, but employers have a range of options they can offer to support caregivers, including leave policies that allow employees to take time off for themselves or loved ones, options for remote work, increased paid time off, emergency backup care, and respite care, the report said.