Policies to support a multi-generational workforce

A new report shows that across the OECD, the average length of a job held by the same worker declined by around nine months between 2012 and 2019, and the decline has been felt across all age groups. This fall in job stability coincides with people changing jobs at a fast pace. The unprecedented labour and skill shortages that emerged during the recovery from the COVID‑19 pandemic have raised further the importance of developing and retaining talent. In the context of a more age‑diverse workforce, addressing this challenge will require better working conditions, greater investments in training and tackling difficulties in reconciling work with health issues and caring responsibilities.

Policies for multigenerational workforce

‘Retaining Talent at all ages: ageing and employment policies’ from the OECD looks at the impact of digital and green transitions and population ageing on the world of work. The report finds that the deep and rapid changes in the world of work driven by the digital and green transformations as well as population ageing have been associated with greater job instability, with potential costs for companies, workers and society. Across the OECD, the average length of a job held by the same worker declined by around nine months between 2012 and 2019, and the decline has been felt across all age groups. This fall in job stability coincides with people changing jobs at a fast pace, sometimes at the highest rate seen in recent decades – one in five workers experience a change in their employment situation every year – and the rate of job change has increased in 24 out of 27 OECD countries for which data are available over time. Older people aged 55-64 do not switch jobs seamlessly – whether they quit or lose their job – they will often end up unemployed or will leave the labour market. Once out of work, they are far less likely to find a new job and more susceptible to large wage cuts upon hiring. With more people working for longer, and in the context of current unprecedented labour and skill shortages, there is a pressing need to ensure that the talents and skills of a multigenerational workforce are put to best use, including through greater worker retention.

Flexible working arrangements and support for caregiving
The report finds that it is not just wages that can make jobs attractive, the option to work from home on a regular basis is also very important. Unfortunately, mature workers have much less flexibility in their jobs (such as being able to work from home or flexible hours) and less flexibility to care for dependent adults. Currently, only 19 out of 35 OECD countries for which data is available provide paid caregiving leave for older adults. Moreover, there is often a stigma associated with using caregiving leave, which requires further action by firms and governments to improve the availability and take up of policies to support adult caregiving. Government and employer policies such as parental leave and paid caregiving are crucial to helping people reconcile work with family and care responsibilities, particularly as we age. The high proportion of women with caring responsibilities in the labour market and unpaid care work carried out by older workers means that governments and employers need to do much more to help people balance work and caring responsibilities.

Supporting skills development

Investment in skills to build resilience is important as with ageing societies employers can no longer rely so heavily on a skills pipeline of younger workers leaving initial education. Older workers are more likely to experience skills obsolescence and therefore upgrading and reskilling of workers throughout their working lives is essential. Automation, artificial intelligence and demographic change are transforming the nature of work and production, radically altering the task content of jobs. At the occupation level the risk of automation depends crucially on the particular bundles of skills and abilities that a job consists of. Most jobs are made up of skills and abilities that are easily automatable and those that are not. On average across OECD countries, occupations at highest risk of automation account for about 28% of employment. Very few occupations re at risk of disappearing altogether, but many will alter significantly in the coming decade and a skill strategy that targets older workers is required to support them to remain in employment. Workers need to continuously upgrade, reskill or expand their skills over their entire working lives to enable continued employment

There are persistent inequalities in the provision and take-up of training by age. PIAAC data show that on average across OECD countries only 24% of adults aged 55-65 participate in job-related training, compared to 41% of adults aged 45-54. This can leave older workers without the right skills to flourish over longer working lives. Older workers can also face several barriers to training, including cost and age discrimination that prevents them from accessing training.

High performance work practices play a key role in ensuring that firms are effectively using their employees’ skills. This includes effective career development and performance management which can support skill use and grow the skills and experience of existing employees.

Promoting all-age lifelong learning is essential to retaining talent. Key policies to support skills development for a multigenerational workforce are:

Governments and social partners can promote high performance work practices through supporting research, raising awareness and disseminating good practice, and funding workplace interventions.
Equipping all workers with basic digital skills should be a key priority as it can boost their confidence and increase their willingness to participate in further training.
Good practice by employers and employees includes regularly reviewing skills and work tasks to identify future training or development. Tools such as mid-life career reviews, personal development plans and career conversations can help employees make informed decisions about their training and development.
Make training attractive to workers of all ages without being discriminatory. Training may need to be adapted to the needs of older workers who are more likely to appreciate in-house one-on-one training, or training with the same age cohort.
The formal qualifications of older workers are often out of date and participating in training can take considerable time. Recognising the skills and knowledge that older workers have gained on-the-job can reduce the time needed to participate in further training.
SMEs often experience severe labour shortages and lack the resources and information to provide training opportunities. Governments can target financial incentives such as subsidies at SMEs or support firms that supply training programmes in SMEs. Learning and training networks can also be used to pool resources to reduce costs and share knowledge about effective training.