By Brian Chernett, Founder, The Academy For Chief Executives
As those of you who have read my articles on this topic in the past, or have read my book, The Entrepreneur Within, will know, this is a topic that I’m passionate about. As someone who is in the high end of the age spectrum and still contributing time, insight and effort into developing leaders, I have often argued that age should not be a factor in employing the right people. Older people have skills, knowledge and experience that teams need to balance the energy and enthusiasm of younger employees.
This month, the UK drops the Compulsory Retirement Age, allowing older people to continue working beyond 65 (or whatever other age had been set by an employer). 'So you think you can ever retire?' - As an article in the FT points out, that changes the way that firms will address the performance of older employees and may result in the need to hold them to performance targets more than now. They quote Deborah Russell, director of workforce issues for the AARP (American Association of Retired Persons), a US organisation representing retired people “Before, you may have had a not-so-great older worker but figured that in seven months they’d be leaving, so you didn’t have to address the issue. Now you do. My position is that it doesn’t matter what age that person is, if they’re not performing the duties of the job, that’s something you should be required to address.”
With Pension provision an issue for many older workers, more will feel they must work on rather than retire. Whilst I’m in favour of the right to choose not to retire, I’m concerned that this pressure may lead to more motivation issues in the workforce.
There is also a knock on effect of this change. As jobs, especially more senior ones, are occupied by people who need to stay on longer, so promotion will be harder to achieve for those further down the age range and maybe recruitment will also slow. Some of this effect would be reduced where we to grow more quickly, but in the short term, there may be an unexpected consequence on employment prospects for university leavers.
Other than this change to retirement age legislation, there is little regulation of the age diversity of your workforce. Nevertheless, good practice will suggest that you need to consider succession within business and, thus, the need to grow your own future management. There will be a lot of graduates looking for work for the next few years and competition for jobs will be high.
This is going to be a difficult judgement for many businesses to make. There will never be a better chance to recruit good, young people with excellent qualifications. Yet you still need to support your older team members and with the removal of the default retirement age, there is no upper limit on when they are likely to leave you.
Will this lead to a new 'squeezed middle '? Will there be a glut of people in the midpoint of their career who find themselves blocked from above by people who are unable or unwilling to retire whilst being threatened from below by bright, smart graduate entrants on the career ladder?
How this change of demographic is managed will say a lot about wider society and culture and a lot about your business, too. Striking a balance between age and youth, experience, energy and enthusiasm will require all of your leadership skills.
I'll return to this topic another time because I am fascinated by how businesses will choose to cope with a seemingly gritty conundrum. For now, it is an issue that will be crossing your desk sooner rather than later. How will you handle it?
Brian Chernett is the founder of The Academy for Chief Executives and Chairman of Academy Group ACE2. Having stepped down as Chief Executive of the Academy, Brian is now developing his own coaching and mentoring business — Wisdom Forums - for senior executives and building a new charity, The Ella Foundation, to coach and mentor Chief Executives in Charities and not for profit business
Watch the video below featuring Brian Chernett, Founder of The Academy For Chief Executives, explaining how The Academy For Chief Executives inspires business leaders.
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