Tapping a silver mine

It has been a stubborn headline, refusing to budge from local newspapers over the past few months. The ageing workforces in Singapore and much of the developed world are forcing HR directors to don new lenses when looking at their staff.

At present, 53.7% of Singaporeans aged 55 to 64 are working; with this group set to make up at least 55% of the total workforce by 2015. Fast forward to 2020 and over a quarter of the population will be over the age of 65 years old. Singapore and Hong Kong, like many other developed countries around the world, will have a distended “grey” population.

This, coupled with slowing birth rates, means businesses are now facing a long-term labour crisis. The number of new entrants to the workforce is inadequate to meet the required labour demand, and the situation is only going to get more unequal over the coming years.

To cope with the inevitability of this talent shortage, companies must look to the mature workforce to help fill the gaps. HR needs to get the most out of this segment of the population for as long as it can. Fortunately, there is a lot of potential that has until now often been ignored by employers. This “Silver Mine”, as some media have referred to it, is waiting to be tapped with interesting, rewarding and flexible job opportunities. They are ready, and willing to work but only under certain conditions. It’s up to HR to adapt its procedures, from flexibility of work arrangements to benefits, compensation and training strategies, accordingly. And it needs to adapt them quickly.

HR and the mature workforce

One important strategy is to ensure mature staff have the skills, opportunity and incentive to work beyond pre-determined retirement dates. This is a key rule at Coca-Cola’s bottling organisation in Singapore. K Thiveanathan, Human Capital Director, Coca-Cola Singapore Bottlers, says there is a clear process in place to review each case of a retiring employee and find out what role options may exist beyond retirement. “A supervisor is required to have a discussion with retiring employees at least 12 months prior to his or her retirement with the view of seeking (further) career options,” he tells HRM.

Those role considerations are not simply limited to the employee’s current department. Thiveanathan says all available and fitting roles are placed on the table, with the discussions captured in a formal document for review and follow-up by the HR team.

In particular, the organisation needs to ensure there is a smooth transition in terms of salaries and benefits. Coca Cola Singapore Bottlers has established a guide on “salary transition” from the pre-retirement to post-retirement stages. Such a process prepares retiring employees, whether it is for a new role in a different department or for that actual last day of work, Thiveanathan says.

The experience advantage

This brings HR to another reason for keeping its mature staff working and engaged for as long as possible. These workers will often have built up a large store of knowledge and experience, both from their field of expertise and of the company itself. Coca Cola Bottlers observes that older workers are often able to pass on their passion and enthusiasm for the organisation to younger recruits.

“Critical skill-sets are embedded in their experience,” Thiveanathan says. “This institutional knowledge is vital when trouble shooting.”

With a 600-strong workforce, 9% of Coca Cola Singapore Bottlers’ office staff are permanent employees are aged 56 years and above. Thiveanathan says he is proud that some 15 retiring employees were re-hired last year alone. “We welcome employees to our ‘family’ and not merely to a company which only has need for them when they are at their maximum physical productivity.”

Training

A second strategy for maintaining a workforce moving into its twilight years is training. The key advocate for ageing citizens in the US, the AARP Public Policy Institute, says by building skills even as workers approach or consider retirement, organisations can keep them engaged and active in their commitment to work.

In some cases, older workers may shy away from training; in others, employers do not encourage them to participate, the Institute says, but notes that both situations are often prompted by the assumption that mastering new skills becomes more difficult with age.

But that is a well debunked myth. Instead, research shows that older workers can and do learn new technologies, albeit at a slower pace than some of their younger colleagues.

Singapore’s second largest bank, OCBC, says its learning and development schemes are tailored toward each individual worker, including the older demographic. The bank helps equip them with the necessary skills to enable them to remain employable within and across the organisation.

“By helping our employees to make a job switch within OCBC, we help broaden their job experience and provide them with the incentive to sustain a long-term career with us,” Jacinta Low, Head, Planning and Employee Communications, OCBC Bank, says. “What we like about older workers is their wealth of experience. This, accumulated over the years, is accompanied by qualities such as commitment, patience and resilience.”

Where does the government stand?

According to a survey by Singapore’s Ministry of Manpower in 2008, more than 65% of employers with a set retirement age routinely offered reemployment opportunities so that staff could continue working beyond that time. Yet while these are certainly healthy figures, the Government is looking to get an even greater re-employment rate among employers on the island.

In this way, it introduced its well-known re-employment laws last year. These say that by 2012, employers will be required to provide job options to older workers once they reach the age of 62.

Going a step further, the Government has also called on employers to offer financial help to mature workers who are not re-employed, assuming they are performing well and in good health. This one-off Employment Assistance Payment aims to tide workers over while they look for new jobs – with the average expected to be three months.

Singapore aims to increase the employment rate of those aged 55 to 64. Currently at 57%, the Government is looking to increase this to 65% by 2012.