Ageing Workforce

Financial Capability

CFFC raises awareness of New Zealand’s ageing workforce, a result of our ageing population

In 1986, the rate of employment among those aged 55-64 was 49%. By 2017 it was 82% for those aged 55-59 and 74% for those 60-64. In 20 years’ time, the prediction is that close to 400,000 people aged 65 plus, or one in three, will still be working, and they will represent a far greater proportion of the workforce.

This is going to have a number of knock-on effects for employers, managers and their businesses. Many employers tell us they are concerned about the impact of the ageing workforce, yet few are doing anything about it.

A 2018 CFFC survey of 500 companies found most agreed that there was a shortage of highly experienced workers. Most had a positive attitude towards older workers, finding them no more or less resistant to change than other age groups, and no more likely to have high absenteeism or sick leave. Most agreed that businesses should take extra steps to attract and retain older workers, viewing them as an 'untapped resource'.

Yet 80% had no specific strategies or policies in place and the majority agreed that older workers can face barriers to being hired because of age.

Ageism in the workplace

It’s worth challenging ourselves with the question: when was the last time you hired a person older than you? How often does your recruitment company pass on CVs of applicants aged 50 plus?

Ageism is an insidious human trait that some of us may not even recognise. It can be bundled up in vague references to a candidate not being ‘quite the right fit’. We need to acknowledge it and call it out, and then do something about it.

Employers are already experiencing a worsening shortage of labour supply, with 65% saying there is, or will soon be, a skills shortage in their respective sector. For example, with almost 24% of New Zealand’s workforce already aged over 55, there are only four to five teachers or nurses to replace every 10 that will retire.

Contrary to the ‘lump of labour fallacy’ that older workers take jobs from younger people, retaining older employees feeds economic growth and creates more jobs for everyone. There are significant economic gains to be made in higher tax receipts, spending and less reliance on government transfers.

Then there is the sheer experience that older workers bring to the table, their maturity in the workplace and willingness to pass their skills on to the younger generation.

What older workers want

Workers tell us that some of them will need to work past 65, but many simply want to. They value the social connection, the sense of worth and purpose, the extra money that will give them more choices. Their needs are relatively simple: more flexibility, possibly working part-time, possibly with more leave. And some will want to upskill and retrain to fill different roles.

As our workforce is ageing, it is also changing. People no longer expect to remain in one job for years and years. The ‘gig economy’ means workers are shifting more, contracting more, and our future generations will move through several careers across a lifetime. We are seeing less of the ‘gold watch’ moment where people shift from full time work to full retirement in a day. There will be many transition years in the middle, when we want to work a bit differently but still stay active.

Employers will need to have those conversations as they attempt to recruit older workers and work to retain them. But at the moment we seem to have a stand-off between managers reluctant to broach the subject of ageing and transition, for fear of being seen to be pushing older workers out the door, and older workers not wanting to go there for fear of being exited.

CEOs, boards and managers need to start thinking strategically and planning for how to make those conversations, and the arrangements that come out of them, as natural as inductions and performance reviews. It should be part of their human resource offering and factored in to a planning cycle.

A global opportunity

We’re not alone. New Zealand’s ageing workforce is part of a global trend. It’s a predictable demographic change that we can’t afford to ignore, and that should be faced not as a crisis, but as an opportunity. 

Whether we’re an employer, manager or someone in a business that serves older workers, we need to be prepared for a future with many more of them, and that won’t happen without actively and intentionally addressing the issues. We will come to appreciate older colleagues as much as they appreciate coming to work.

Taking action

In 2018 CFFC was part of a public and private working group that produced the white paper Act Now Age Later.

It was launched by the Minister for Seniors, Hon Tracey Martin, and called for a National Strategy on the Ageing Workforce and the development of a toolkit for employers and workers. The working group was made up of government departments and agencies, including CFFC, the Council of Trade Unions, recruitment companies and the Employers and Manufacturers Association.

Looking at the future

Looking at the Future

Looking at the Future