Around 13.5% of today’s population are currently aged 65 and over, but by 2050 this age group will make up almost 23% of the population (Australian Bureau of Statistics, 2012). The ageing population has given rise to a host of issues for organisations and workplace planning. In this week’s blog we talk about the typical age of retirement in Australia, how this affects an organisation and how you can help manage these issues.
Currently, in Australia, there is no set-in-stone retirement age (SmartMoney, 2014), however, there is an average number. For most people, the point at which they are ready to retire is determined by a few factors, including eligibility and age to access superannuation funds, the qualifying age of the age pension from Centrelink, health status, job satisfaction, work/life balance, job stress etc. Power (2015) mentions that the current pension age is 67 years old.
Around 77 per cent of Australians over the age of 65 receive some income support from the government. For those wishing to retire early, it will mean relying on their superannuation and other savings between retiring from the workforce and reaching age pension age.
With a wave of baby boomers reaching age 65, retirement is being redefined for the 21st century. In the 21st century, most first world citizens live 30 years longer on average than they did a century ago. Average life expectancy is now 81 for women and 76 for men. With more people living longer, it also means there will be more people to work longer as well (Shacklock, 2013).
Although the word "retire" means to withdraw or depart, many 65-year-olds today are healthy enough to work, travel and pursue their lifelong dreams – with opportunities that were unimaginable a century ago (Shacklock, 2013).
There is now an increased level of awareness, or at least a perception, among older workers that they may have a choice about whether to remain working in their present employment, switch to an alternative job—either full time or part time or alternatively cease working entirely. Choices are a consequence of health, financial position and motivation to work (Patrickson 2001). Those whose health is deemed to be good, and who feel they need the money are the most likely to want to stay. Those whose skills are in short supply are the most likely to have the opportunity to stay. Managers have the opportunity and the responsibility to initiate discussions with their older employees to consider employment options they may not have thought of themselves, which may have the effect of prolonging their productive working lives to the benefit of the organisation, as well as the employees (Patrickson & Ranzijn, 2015).
Be proactive, not reactive
It is essential for employers to get away from thinking of older workers as a homogeneous group. Organisations need to collect information on each of their older workers to find out what their intentions, expectations and aspirations are, and to identify the range of employment options that they could possibly put in place. Managers need to initiate discussions with their individual older workers to explore different options and possible new roles. Once identified, talented older workers should be retained, even in a reduced working capacity, and the challenge is to reach agreement on an employment option suitable for all parties (Patrickson & Ranzijn, 2015).
Transition to full retirement
The final option is easing the transition from the workplace by exploring forms of staged retirement. There is increasing acknowledgment that external factors, such as caring needs and other responsibilities can impact productivity, and working hours and conditions for many employees are increasingly being modified on an individual basis to reflect this (Platman, 2003).
What do you think about the ageing population issue and its effects on the workplace? Do you implement any strategies to retain and/or help retirement transitions? We would love to hear your thoughts!