Baby Boomers are turning retirement upside down, which is just as well for employers facing a skills shortage.
By Carolyn Boyd
Not so long ago when workers reached retirement age most threw a party, said goodbye to the boss forever and rode off to a quiet life of golf, bowls or gardening. Recently we've become more prosperous and the trend has been to retire even earlier to enjoy the good life.
But things are turning full circle. Older folk are discovering they've still got much to give, and in fact, life without work is not as fulfilling as they had been sold. In typical shake 'em up Baby Boomer style, employees in their 50s and 60s have begun to redefine retirement and are opting to stay in the workforce, either full-time or part-time.
Some report that even though they have been eager to keep working, getting a job has been difficult. All that is about to change. Bosses are realising that if they let their most experienced staffers opt out, particularly the big bubble of Baby Boomers, they will lose much-needed skills. Adding impetus to the issue is that a deepening skills shortage is threatening to put a major dent in Australia's economic prosperity by forcing businesses to operate below capacity, putting pressure on inflation and undermining our national savings and investment levels.
Boomers were born between 1946 and 1964, and are expected to begin leaving work at a greater rate after they start to hit 65 from 2011. The impact is already being felt.
A federal government report, Workforce tomorrow, says that the nation will be 195,000 workers short over the next five years if it can't convince older people to stay on at work. They're becoming a valued resource because, due to falling birth rates, Australia is fast running out of new workers. Access Economics predicts that during the decade from 2020 only 12,500 extra people will enter the workforce each year, compared to an annual increase of 170,000 at present.
In the broader economy, the skills shortage is so bad that even the hidden talent pool of last resort, the long-term unemployed, is beginning to dry up. The unemployment rate in November dropped to 4.4 per cent, one of the lowest in 30 years. Figures from the Bureau of statistics show that the long-term unemployed are being drawn back into the workforce, the percentage of people aged between 35 and 44 getting a job for the first time leapt from 2 per cent in 2002 to 6 per cent last year.
Accounting is already suffering a skills shortage brought about by a boom in financial planning, more complex compliance requirements and a more sophisticated banking and finance sector that is snapping up accountants.
Already, four out of 10 employers say they are trying to attract and retain mature-age workers, according to an April 2006 survey by headhunter Hudson. But more needs to happen, says Scott Stacey, Hudson accounting and finance national practice leader.
'This should serve as a wake-up call to Australian business,' he says. 'Organisations need to seriously consider flexible work options as a real solution to the growing pressure to retain mature-aged workers.'
Older staff are often more settled and are not looking for greener pastures. They also bring a depth of skills and experience, and have lived through a few economic and business cycles, which can provide useful insights.
A 2006 study by TNS Social research found that in accounting, 32 per cent of employers have nearly one-third of vacancies unfilled, and are taking up to two years to find a suitable candidate.
The jobs are out there, and so are the older people willing to do them. But as CPA Australia discovered, the two groups are unlikely to meet up without some help. When CPA Australia ran a pilot initiative placing older workers in jobs in 2005 / 06, it found that while most accountants want some kind of professional engagement, they face obstacles, including employers' perception that they aren't adaptable, a distrust of older people's motivation for re-entering the workforce, a lack of quality part-time work, and the cost and availability of training. Some of the blocks lay with the professionals and included needing to brush up skills, and change the way they sought work.
CPA Australia is launching a multi-pronged initiative to bring employers and older workers together.
'CPA Australia recognised early that professionals in career transition, be they those planning a phased retirement or women returning to the workforce, could play a pivotal role in helping to address the skills shortage in the accounting profession,' says Ian Mayer, CPA Australia's general manager, reputation and standards.
'We are leading the way in this area by providing information and training to support members with this issue while working closely with government and employers to explore further solutions.'
Recruitment firm Professional Careers Australia worked with 28 mature-age professionals as part of CPA Australia's mature-age pilot. The agency placed 13 candidates in jobs, and a further nine found their own work after some coaching.
Nearly two-and-a-half years into his role as general manager of Canberra's Independent property group (IPG), Erik Adriaanse FCPA loves his job. Adriaanse signed up for CPA Australia's pilot program because he was looking for a change after merging the accounting and financial planning practice he partnered (along with four others) with another firm.
'It's all gone exceptionally well,' the 57-year-old says of his career switch. 'The job's great and we've kicked a few goals.'
Earlier this year, Adriaanse took part in his 19th Sydney-to-Hobart yacht race and is looking forward to many more years of boating and working.
'I'm looking at working until [the age of] 63 or 64 full-time, and then maybe phase down a bit,' he says.
While Adriaanse took a full-time role, most participants in the program were seeking more flexible arrangements. PCA's former manager of accounting and finance Simon Cox worked closely with the candidates, and says most wanted roles that were lower than their full potential.
'They [want to] balance their changing personal needs, which can be anything from ill-health through to valuing their leisure time more, or they might be in-house grandparents who look after their grandkids. Some are building a coast house,' Cox says.
'If employers are willing to adjust their expectations and manage their workflow better, they can create more part-time roles and have some real long-term staff, not just the Gen Ys turning over every one to two years.'
Cox says the mature-age market is still relatively untapped. 'There's some blockages on both sides,' he says. 'Generally speaking most of the candidates weren't familiar with recruitment agencies and how they worked and the market itself, and quite where they fitted in. The older market didn't change jobs as regularly; weren't as market savvy; and saw a CV as just a list of what you've done and nothing more.
'Similarly with employers, they need to be prepared to be more flexible with working hours and conditions, and also work towards providing different sorts of training for people. A lot of these people have very strong, broad theoretical knowledge but don't have the core skills, particularly in relation to IT, to do a lot of this work.'
In the study, Cox initially found employers' attitudes difficult to negotiate. 'Someone with 45 years' experience coming in, that doesn't necessarily fit the employers' model and people might have the initial knee-jerk reaction of, "Is that person too old?"' he says.
'But if the client has received a call and you run the idea past them, they're much more willing to meet with the candidate.'
Phillip Guest, managing director at recruitment firm Michael Page International, says the benefits of flexible work practices need to be understood, communicated and championed at the executive level.
'We are seeing some employers change but our view is that there's more that aren't than are,' Guest says.
He suggests job share or work-from-home arrangements, and says organisations need to become accustomed to older people not necessarily wanting to grow their career.
There were about 100,000 people aged 45 and over who were unemployed in November 2007, says Richard Millington, the director of mature-age strategies at the Department of Employment and Workplace Relations. A further 216,000 people aged over 45 were not in the labour force.
Of those not looking for work, nearly 10 per cent told the ABS that they were 'considered too old by employers'.
About one in five said they weren't seeking employment due to family reasons, which could point to the fact they could not find flexible employment that recognised their responsibilities as parents, grandparents and carers.
A Hudson research paper, The evolving workplace, found seven key factors affected whether or not mature-age workers stayed in paid jobs: commuting time to work, pay, a friendly work environment, new challenges, recognition, flexible working hours, and the ability to work from home.
In the study, full-time work appealed to 6.7 per cent of the more than 1000 mature-age workers questioned.
But if more attractive conditions were offered, such as flexible hours, almost half (47.1 per cent) would take up a full-time role, and more than one in five would accept a part-time position.
Only about 1 per cent of the sample said they'd retire. 'There are numerous cases of mature-age workers not only continuing to work into their 60s and 70s but also starting new careers, Millington explains.
Getting older people working requires effort on all sides. Experts say employers should encourage social activities to get older workers together.
Attitude changes are needed, too. A survey last year by networking site linkme.com.au found that 73 per cent of Australians believe that finding employment is practically impossible after the age of 50. Nearly as many thought gaining employment after 45 was 'almost impossible'.
Recognising the huge social security burden it faces, the federal government is doing its bit to keep people working through its transition-to-retirement strategy, which allows workers over 55 to take out a pension income stream from their super while salary-sacrificing their wages back into their fund. The government also offers a tax-free lump-sum payment of up to $32,000 for workers who postpone their retirement for up to five years.
Governments around the world are increasing official retirement ages. In Australia, the minimum qualifying age for women will increase from 60-65 (according to date of birth) to a standard 65 by the year 2014, making it the same for men and women.
Denmark will gradually increase the national retirement age for men and women from 65 to 67 by 2027, and Germany will slowly lift the retirement age for men and women to 67 by 2029.
Leading the way
Late 2005, CPA Australia holds 10 focus groups in eastern-state and territory capital cities to discuss mature-age workers' expectations and experiences. Two further focus groups with members of the Canberra business council and Australian business limited are held in Canberra to gauge employers' perspectives on the skills shortage, obstacles to employing mature-age workers, training requirements and methods of placing older staff.
2005: Professional Careers Australia was appointed as the recruitment partner for the pilot project. Of the 45 people who volunteered for the project, PCA chose 28 mature-age participants.
2006: By the conclusion of the project, PCA placed 13 candidates and a further nine found their own employment after some coaching.
2006: The ACT division of CPA Australia continues to provide the service piloted during the project for mature-age members in Canberra.
September 2006: The report, A mature solution, is launched by Kevin Andrews MP.
2007: CPA Australia formally begins working towards implementing the recommendations of A mature solution.
March 2008: Online resources for mature-age workers and employers go live, and soft skills training days in each state get under way.
l June 2008: Official launch of CPA Australia's mature-age initiative.
