The silver generation makes up the largest share of new business owners in the US, and its share of the workforce in many large economies has significantly expanded. Governments and firms need to work in tandem for their integration into modern workforces.
Barring most of Sub-Saharan Africa and India, the world has been ageing. China’s population peaked in 2021, the proportion of people over the age of 65 in the US is projected to increase to over a fifth by 2030, the EU’s population is expected to peak in 2026, and India’s fertility rate is falling. Thus the world’s major economies will all have the silver generation making up a significant part of their population.
While migration is touted as a way to plug age gaps, the phenomenon is becoming increasingly politicized and unpopular. In response, governments should focus on absorbing more of their silver generation into the workforce, which is already happening in developed countries.
In the US, for example, the labour force participation rate of people aged 55-64 rose from 55% in 1990 to around 65% in 2020. In the EU, it went up from 36% to 60%. But it could be given explicit policy support.
A host of studies show that older adults are staying on at work after retirement age or rejoining work when given appropriate opportunities. Employers and governments need to work together to better use their expertise.
In Germany, certain industries pursue silver-friendly work policies, which enable better worker retention, upskilling and inter-generational knowledge transfers. In North Rhine Westphalia, continuous and flexible education programmes have enabled better worker retention in the logistics and transport sector.
This, together with the German government’s decision to raise the retirement age to 67, has lengthened the career-span of workers. It is not only a matter of raising retirement ages, but also one of ensuring the silver generation is empowered and trained to contribute effectively.
It is important to empower people above 50 with the job flexibility of working at a pace they are comfortable with. There is enough evidence to show that the silver generation is willing and able to keep working.
At WisdomCircle, an age-tech platform designed to unite the worlds of retirement and recruitment, we believe that the nature of this generation’s work differs from that of younger workers.
Many studies on ageing and work show that the silver generation is looking to provide strategic and tailored advice, rather than take on full-time career-setting roles.
Our experience and other research studies show that most workers want to be useful, but mostly in advisory or strategic capacities. They are looking for relevance and respect, which is a challenge at times, given attitudes towards older workers and recruitment plans geared for absorbing new talent, rather than retaining and retraining existing workers.
The silver generation has the potential to work with organizations on finding pathways to improved productivity. It can mentor younger workers.
However, a flexible gig-work approach can sometimes be in conflict with business objectives, as employment is usually seen as a full-time occupation. There are, of course, ways to strike a balance that suits both employers and silver-gen employees.
But, in the absence of the right political economy factors that incentivize firms to view the silver generation as delivering a demographic dividend of their own, such attempts will have limited impact. Better coordination between industry, government and employment agencies can be a key starting point.
Incentivizing entrepreneurship is another way to engage with the silver generation. Their financial stability, social capital and experience make them well positioned to be entrepreneurs.
There are already trends indicating that this is happening. The Kauffman Indicators of Early-Stage Entrepreneurship (2021) show that in the US, people in the 45–54-year age group go for entrepreneurship at the highest rate.
Business gains aside, engaging the silver generation has societal benefits too, such as reduced healthcare costs to be borne for older people. Minds that are kept active and are used to solving problems and interacting with others are less likely to decline.
A better sense of well-being has a positive effect on physical health too. This reduces the number of people who would need assisted living facilities and other support as they age. Repetitive tasks or lack of work have been correlated with a higher risk of dementia.
Given the rapidly rising costs of treatment, estimated to rise to $1 trillion by 2030 from $360 billion in 2023, the potential savings can be immense.
There is a clear case for every economy to keep its grey-haired workers working for longer. Their knowledge and experience place them well to set up new businesses, learn new things and embark on second careers.
As birth rates decline, the world needs a workforce that can ride out the inevitable changes in the age profile of its population. Companies and governments alike could count on the demographic dividend of the silver generation if they provide the right incentives to do so.
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