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Activation of senior citizens - Introductory overview and outlook

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Presentation by Donald Storrie (European Foundation for the Improvement of Living and Working Conditions) on the occasion of the Joint EESC conference organised by the Labour Market Observatory and the European Year 2012 Coordination Group on the Activation of senior citizens - Humanising working conditions for senior workers (Brussels - 20 June 2012)

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Activation of senior citizens - Introductory overview and outlook

  1. 1. European Year of active ageing and solidarity between generations 2012 European Economic and Social Committee EESC Labour Market Observatory Coordination group Activation of senior citizens: Humanising working conditions for senior workers Wednesday 20th June 2012 Room VM3 “Introductory overview and outlook” Donald StorrieEuropean Foundation for the Improvement of Living and Working Conditions
  2. 2. During 100 years Europe becomes 16 years older Median age 39.8 in 2010Median age 31.5 in 1960 Median age 47.2 in 2060
  3. 3. (POP65+)*100Old age dependency ratio POP15-64 Germany and Italy over 30% The 2012 Ageing Report
  4. 4. Old age dependency ratio 16 Member States over 30%
  5. 5. Old age dependency ratio Every Member State except Ireland over 30%
  6. 6. Demographic ageing• The demographics of the old-age dependency ratio prognoses are credible.• A “no other change” scenario leads to appreciably lower GDP/capita with significant financial & distributional consequences.• Labour productivity, immigration & Aggregate labour input = = Emp rate * working life * average hours.
  7. 7. How to make up the labour shortfall?• More immigration – not enough! And do “we” want it?• Higher fertility – too late!• Longer working hours – self defeating?• Higher productivity – a cop out!
  8. 8. How to make up the labour shortfall?• More immigration – not enough! And do “we” want it?• Higher fertility – too late!• Longer working hours – self defeating?• Higher productivity – a cop out! More active & inclusive employment policy and work longer!
  9. 9. Employment rates by age 2000-2012 Source: European Labour Force Survey
  10. 10. Employment rate of 55-64 year olds2010
  11. 11. “When I’m 84”• According to Paul Baltes the “young old” (between 65 and 84) have substantial potential for physical and cognitive fitness, retain much of their cognitive capacity, and can develop strategies to cope with the gains and losses of aging• Significant recent increase of the employment rate for the 65-74 year olds
  12. 12. Employment rate of the 65+ 8.9% in 2005 up to 10.8% 2011• 65-69 10.8% UK 20%, F 4% 70-74 5.3 % 75+ 1.2%1. Financial reasons - but intrinsic factors in quality of work are more important than for younger2. Continuation of career or new start3. Eurofound case studies – many cases of negative perceptions• Company initiatives to address these 3 points
  13. 13. Employment rate of 55-64 year oldwomen 2010
  14. 14. Employment rate of 55-64 year oldmen 2010
  15. 15. Why employment rates for older workers will continue to increase• Labour shortages• Continual decline in physically demanding work• Continual improvement in health• Future cohorts will be better educated (& LLL)• More (older) women will be employed• Relatively more old workers will reduce relative wage• Learning about caring – See Eurofound research• Policy? pension reform etc?
  16. 16. Extra slides
  17. 17. Life course perspective• Pre-pension (55-64) - health, care, working time. - gender, restructuring (pension and labour market policies and practices)• Post-pension (65+) - intrinsic job quality, perceptions of ageing (financial insecurity)• Sustainable work throughout working life
  18. 18. Sustainable work• Ageing as a process• (-) Cognitive mechanics (e.g. processing speed) - stimulate intellectual engagement• (+) Cognitive pragmatics (e.g. experience knowledge)• And openness to new experiences versus emotional stability, agreeableness and conscientiousness• Age management and complementarities• Matching over the life course
  19. 19. Sustainable work – evidence from EWCS (i) The bad news is|:• Shorter but more intensive working hours• Limited changes in cognitive content of work and autonomy The good news is:• Big decline in perceptions of health and safety risks• Some more training - especially for older
  20. 20. Sustainable work – evidence from EWCS (ii)– “Do you think you could do the same job when you are 60?”– “Yes I think so”• Related to all “favourable working conditions” – (but not to long working time) and expected occupations.• Slightly more Men• Most important – low exposure to posture and movement related risks and harassment• 57.1% “yes” in 2000 in and 58.7% in 2010
  21. 21. Pre-pension 55 to 64 year olds and careCare of parents or spouse -compare with childcare and labour supply - potential for policy impactEurofound cases of company initiatives• Awareness raising – managers• Working time & leave• Information and counselling• Also for men
  22. 22. Age and structural change• With older labour force more older workers will bear costs of labour market adjustment• No macro evidence that “job sacrifice” by the old benefits the young.• If wages > productivity for older workers – higher unit labour costs• Institutionalisation of early pensions of the 1970s and 1980s.• Eurofound cases suggest -less common in the recent recession
  23. 23. A stylised graph of wage, productivity and age Wage€ Labour productivity AGE
  24. 24. Low re-employment rates of older workers1. Search for insider wage in the external LM2. Discrimination3. Lack of effort from employment services4. The “easy” early retirement/disability/sickness pension option5. Skills inflexibility (versus experience knowledge)6. Short payback time for human capital investment
  25. 25. Job search for older workers• New policy & labour market authority mind set• Coaching• Complementary training• Realistic wage claimsSocial security contribution reduction?- When youth unemployment is record high!- Perhaps with youth subsidies!

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