Companies in the rich world are confronted with a rapidly
ageing workforce. Nearly one in three American workers
will be over 50 by 2012, and America is a young country
compared with Japan and Germany. China is also ageing
rapidly, thanks to its one-child policy. This means that
companies will have to learn how to manage older workers
better.
Most companies are remarkably ill-prepared. There was a
fl icker of interest in the problem a few years ago but it was
snuffed out by the recession. The management literature
on older workers is a mere molehill compared with the
mountain devoted to recruiting and retaining the young.
Companies are still stuck with an antiquated model for
dealing with ageing, which assumes that people should
get pay rises and promotions on the basis of age. They
have dealt with the burdens of this model by periodically
"downsizing" older workers or encouraging them to take
early retirement. This has created a dual labour market for
older workers, of cosseted insiders on the one hand and
unemployed or retired outsiders on the other.
But this model cannot last. The number of young people,
particularly those with valuable science and engineering
skills, is shrinking. And governments are raising retirement
ages and making it more diffi cult for companies to shed
older workers, in a desperate attempt to cope with their
underfunded pension systems.
Feb 4th 2010 | From The Economist print edition [adapted]