Wednesday, June 27, 2012

Massachusetts: Aging Workforce and Skills Gaps in Metros South/West Region

The first in a series of skills gap reports prepared as a joint project by Commonwealth Corporation and the New England Public Policy Center of the Federal Reserve Bank of Boston has been released. According to "Labor Market Trends in the Metro South/West Region," the Metro South/West Region--which includes major workforce centers like Marlborough, Framingham, Natick, Franklin and Hopkinton--faces the demographic challenges of an aging population and potential shortfalls in workers with the required educational levels.

The area is one of the oldest regions in the state; in 2008-10, nearly 50% of the region’s civilian labor force was 45 years of age or older, suggesting that the region’s businesses are facing a potential overall shortage of younger workers to replace baby boomers as they retire.
In the past decade, there has been strong growth in the share of workers who are 45-54 years old and 55-64 years old. In addition, there have been an increasing number of workers who are 65 years and older and in the labor force. At the same time, there has been a declining number of workers between the ages of 25 and 34 and between 35 and 44.
With respect to unemployment, the report notes:
A larger share of the unemployed in Metro South/West is over the age of 45, compared with Massachusetts and the nation. This is a consequence of the region’s older population. At the beginning of the decade, when the unemployment rate was at 2.1 percent, the unemployed population was largely concentrated among 25-54-year-olds. As the region’s population increased in age over the decade and the Great Recession took hold, the share of the unemployed age 45 or older grew to over 50 percent.
Source: New England Public Policy Center of the Federal Reserve Bank of Boston Executive Summary (June 26, 2012)

Friday, June 22, 2012

Older Americans Support Legislation To Fight Age Discrimination in Workplace

The AARP has released a survey finding that 78% of registered voters over 50 support passage of the bipartisan "Protecting Older Workers Against Discrimination Act,: which is aimed at is overturning the U.S. Supreme Court decision (Gross v. FBL Financial Services) that made it much more difficult for older workers to prove claims of illegal bias based on age. Furthermore, according to "Protecting Older Workers Against Discrimination Act: National Public Opinion Report," over one-third (34%) reported that they or someone they know has experienced age discrimination in the workplace.

On questions related to the proposed legislation, 90% said that competent workers should be able to stay on the job regardless of their age, and 91% agree that older Americans should be protected from age discrimination just as they are protected from other forms of discrimination. In addition, 64% think that people over age 50 face age discrimination in the workplace.

AARP has also published survey segments of the opinion of older voters in Alaska, Maine, Massachusetts, Minnesota, and Tennessee.

Source: AARP Press Release (June 21, 2012)

Wednesday, June 20, 2012

South Korea: Will Have World's Highest Average Age by 2045

A report prepared by the Korea Center for International Finance (KCIF), based on findings by the Royal Bank of Scotland, shows that South Korea's population is expected to be the oldest in the world in 2045. In that year, the average age of the country's population will hit 50. In addition, the report shows that the total number of workers in the country is expected to fall by 1.2% every year until 2025, with the figures rising to 2% up until 2050.
In addition, the old age dependency ratio is predicted to steadily rise in the coming years until people over 65, who are no longer economically active, will outnumber workers in 2039. It said in 2050, every worker in the country will have to support 1.65 people who no longer earn a living.
According to an interview with Youngsun Koh, Chief Economist Korea Development Institute, it will be critical for the government to lay out policies that involve more senior citizens and women in the workforce to prevent Korea's aging population from hindering the country's growth.

Sources: Yonhap News Agency"S. Korea's average age to be highest in the world in 2045: report" (June 19, 2012); Airang "Report: Korean Workforce to Be World's Oldest by 2045" (June 19, 2012)

Tuesday, June 19, 2012

United Kingdom: Report Urges Removing Barriers for 50 Plus Employment

The Policy Exchange has issued a report calling on the United Kingdom to confront the barriers to employment faced by those 50 and older and stating that a failure to provide support based on targeting the barriers to work of the most needy means that many will miss out on the support that they require. According to "Too Much to Lose: Understanding and supporting Britain’s older workers," written by Matthew Tinsley, "without reforms to address these issues, growth in the UK economy will be lower than it might otherwise be and, on average, the population of over-50s could see a fall in living standards."

While the report recognizes that significant progress has been made over the last two decades, with the older workforce becoming more educated, working in more skilled roles and less likely to be affected by health problems, those over-50s currently unemployed are much less likely than any other age group to find work in the next year. Research behind the report finds "that there is a significant scarring effect of unemployment on future wages for older workers and that this is larger than for other age group."

The report says that further regulation is unlikely to help, but that better back-to-work support is needed. Specifically, it recommends:
  1. As a part of the current consultation, the government should look into legislating for a system of protected conversations between employers and employees. This must allow conversations around both retirement and the opportunities for flexible working and provide a platform for employers to get an understanding of the plans of their older workers regarding when they plan to retire and discuss possible flexible working arrangements.
  2. Government pilots allowing more advisor flexibility for older workers across all Jobcentres should be extended where there has been success so far.
  3. The government should pilot a scheme where more skilled older workers can take a budget for the support that they receive and use it to find support in areas that suit their specific needs.
  4. For the potentially large number of older jobseekers whose experience is in sectors that currently lack good prospects there should be the condition to search and/or gain experience in other sectors as part of their mandatory job search activities.
  5. Through Jobcentre Plus there should be a greater push to allow volunteering and work experience on a voluntary basis to older jobseekers who JCP advisors believe can benefit the most from it.
  6. For the minority of older jobseekers that advisors believe are not making a serious attempt to look in different sectors or roles, a mandatory element should be introduced into the scheme. Such claimants would be given the option of undertaking either a Mandatory Work Activity
    placement
    , or engaging in the work experience scheme.
Source: Conservative Home "Matthew Tinsley: Helping older workers" (June 19, 2012)

Tuesday, June 12, 2012

OECD Pension Outlook: Work Longer Before Retiring and Smaller Public Pensions.

The OECD says that governments will need to raise retirement ages gradually to address increasing life expectancy in order to ensure that their national pension systems are both affordable and adequate. Even so, the OECD report "Pensions Outlook 2012" finds that reforms over the past decade have cut future public pension payouts, typically by 20 to 25%.

According to the OECD, over the next 50 years, life expectancy at birth is expected to increase by more than 7 years in developed economies. The long-term retirement age in half of OECD countries will be 65, and in 14 countries it will be between 67 and 69. The report states that increases in retirement ages are underway or planned in 28 out of the 34 OECD countries, but these increases will only keep pace with improved life expectancy in six countries for men and in 10 countries for women. Thus, OECD calls on governments to consider formally linking retirement ages to life expectancy, as in Denmark and Italy, and make greater efforts to promote private pensions.

Private pensions are not a panacea either, as OECD notes that in countries where public pensions are relatively low and private pensions voluntary, such as Germany, Ireland, Korea, Japan and the United States, large segments of the population can expect major falls in income upon retirement.

The report also includes the first comprehensive evaluation of national defined contribution systems. These are:
now a central feature of many countries’ pension systems. Among other recommendations, the report argues that it is critical to set the minimum or default contribution rate in Defined Contribution systems at an appropriate level.

Contributions to these systems need to be high enough so that together with public pensions they generate sufficient income at retirement. While Australia is moving in the right direction by increasing its contribution rate from 9% to 12%, it remains too low in countries such as Mexico and New Zealand (6.5% and 3%, respectively).
Source: OECD News Release (June 11, 2012). See also, OECD, Media Brief.

Friday, June 08, 2012

Australia: Economic Reform Report Calls for Raising Participation Rates of Older Workers

The Grattan Institute, in issuing reform recommendations for providing Australia economic benefits over the next decade, noted that no other reform opportunity compared to tax reform and raising participation rates for women and older Australians. With respect to the latter, the report — "Game-changers: Economic reform priorities for Australia" — said that "Increasing the workforce participation rate of older people would mean that Australia’s GDP would be about $25 billion higher by 2022."

Finding that "[o]lder people generally stop working for discretionary reasons, such as opting to retire once they reach ‘retirement age’, rather than because of difficulty finding work, or barriers such as disability," the Grattan Institute calls for increasing the ages at which people become eligible for the aged pension and eligible to access their superannuation. Specifically, the report recommends raising both the pension age (the age at which people can qualify for the age pension — currently 65 for men and 64 for women, to rise to 65 for both sexes by 2014) and the preservation age (the age at which a worker can access their superannuation — currently 55) to 70.

According to the report, "[m]easures to encourage businesses to employ older workers, such as the Commonwealth Government’s recently announced Jobs Bonus and related initiatives, are likely to have a relatively limited effect on older age participation." In fact, it suggests that "it is not clear that governments can do much to alter employer perceptions. It may be that increasing the pension and preservation ages would do more than anything else to change both employer and employee expectations."
Those retiring today have benefited from an ‘unexpected’ increase in longevity, and it is reasonable that in enjoying this benefit, they share some of the costs that it imposes. The only generation that is ‘unfairly’ treated by increases in the pension age is the cohort that has already retired. Younger people will have to work to any increased retirement age as well.
Source: Grattan Institute Media Release (June 7, 2012)

Wednesday, June 06, 2012

Australian Human Rights Commission Calls for Ending Barriers to Working Past the 60's

The Australian Human Rights Commission has issued a paper detailing how age bars in workers compensation, income insurance, and licencing block willing and able people from continuing in work through their 60s and beyond. In "Working Past Our 60s: Reforming Laws and Policies for the Older Worker," calls for the elimination of all these age bars. Susan Ryan, the Age Commissioner, states: "My hope, in publishing this paper, is to spread awareness of these forms of age discrimination and thus encourage decision makers to devise and implement positive reforms."

According to the paper, the "structural barriers not only create financial and security difficulties for people who work into their 60s and beyond, they also send a message to older workers that they should not be in the workforce." Specifically, the Commission argues that:
  • "[e]xtending workers compensation, income protection and superannuation provisions to all people who remain productive in the workforce will go some way towards ensuring that older Australians enjoy the same rights as the rest of the working population." and
  • "[e]nsuring that the licensing and regulatory requirements do not discriminate on the basis of age will also provide opportunities for people to work for as long as they are fit and productive."
Source: Australian Human Rights Commission News Release (June 6, 2012)

Eurofound Seminars Focus on Working Conditions for Older Workers

Eurofound held its 8th edition of the Foundation Seminar Series (FSS) in Rome in late May. Among the issues on the agenda were working conditions of older workers; national, regional and sectoral initiatives for active ageing; and best practice in companies.

Following are links to the presentations:

Programme:

Presentations:

DAY 1 - Monday 28 May 2012
DAY 2 - Tuesday 29 May 2012
DAY 3 - Wednesday 30 May 2012


Source: Eurofound (June 5, 2012)