Get Ready for the Silver Economy

A recent report published by Criticaleye featuring Accenture research expects the proportion of people over 60 years old to soar to more than 20 percent of global population by 2050, exceeding 2 billion people. An aging population poses new questions for businesses. Commercially, there are opportunities to be realized, but for employers, it’s evident that a fresh approach is now required as notions of retirement begin to change.

In terms of the role of the employer, the responsibility for businesses lies in learning how to tap into the knowledge and experience of older workers. The aging population is proving both a boon and a burden for companies and the way in which they perceive not only their customers but also their employees.

The global population keeps growing. There are now five generations of consumers and a workforce that is rewriting the rulebook on traditional ways of working. The true multigenerational organization is one that recognizes this strength across the different generations and is finding ways to connect the experience, learning and abilities of different groups.

Thirty-odd years ago, men retired at 65 and were expected to live into their mid-70s, equating to 10 years of retirement. However, until recently, most people would expect to be retiring at 60 and living into their 80s, thereby doubling the length of time they are in retirement. This aging population has been fairly good for a number of sectors, including publishing and wealth management.

• Some financial services firms are receiving more money from clients as a result of the growth in the silver economy.

• People are becoming more conscious of their financial and medical futures.

• The aging population wants personalized, trust-based relationships.

• Companies need to connect the abilities of their different age groups.

• We need to change our assumptions about the cycle of work and retirement.

The potential for a loss of productivity through an aging workforce that becomes more susceptible to health problems doesn’t need to happen. For instance, most modern manufacturing can make quite simple changes in the production line to prevent it. Service organizations must also find ways to hang onto talent and experience without clogging up the opportunities for younger people.

This calls for new ways of thinking and more flexibility in terms of how the different generations within the workforce come together, and how we hold onto all the workers with their years of experience.

Flexibility at retirement might be a sensible idea. For example, more imaginative contractual relationships post-65, allowing people to stay in the workforce but on different contractual terms, or annualized hours so that companies can tap into capacity, knowledge and experience when required but not have a permanent, full-time commitment to it.

The biggest business challenges are in changing our assumptions about the cycle of work and retirement, and for more businesses to see the aging population as part of the mainstream of both their workforce and their consumer base. That reorientation of thinking will be quite a challenge for most businesses.

Simon Johnson, Andy Pomfret, Martyn Fisher, Steve Muylle, Mark Purdy and Dominic Swords