Sun, Mar 28, 2010 page12

• Older workers vital to Europe’s growth

  • By Sara Ledwith and Sophie Taylor / REUTERS
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  Terry Robinson is about three-quarters of the way through his second apprenticeship. His first, when he was 15, was as a carpenter and joiner; now, he’s building the skills to attain supervisor status in retail.

  He will be 71 in June.

  Based near Oxford, England, he is in a minority of people who are not only still working, but also acquiring new skills as they head toward their 80s, Europe’s fastest-growing age group.

  Europe’s policymakers hope workers his age and younger can serve as models for the citizens of an aging society.

  In Paris, 63-year-old Carole Avayou would like to join that group. A technician with Air France-KLM since 1978, she had just turned 60 when she was served notice of compulsory retirement. She has taken her fight for work to court, after a vain protest including locking herself in the office.

  “[I wanted them] to discuss things with me, hear my arguments. I put a piece of furniture behind the door and jammed the handle,” she said by telephone.

  These two stories show the contradictory realities facing older people in Europe as it hits a demographic milestone. This year, the number of people aged 60 to 65 will start to exceed the 15-to-20-year-olds who traditionally replaced them in the labor force, Eurostat data cited by Allianz said.

  If Europe’s economies are to grow, older people will have to work for longer, but in a weak economic climate, not many employers want them.

  A demographic cliche about China is that it will get old before it gets rich. The risk for Europe is from its richest generation, the ones who as young adults may have smoked Gitanes or sung “I hope I die before I get old.”

  Having saddled their countries with debts, there’s a strong chance they will lack the wherewithal to fund the “silver” consumer lifestyle typified by the US’ high-profile retirees. Instead, they risk forming an aging, stagnating bloc that further cripples its economies with the burden of their care.

  “We are running into a serious financial problem combined with an aging and — in countries like Germany — a shrinking society,” said Reiner Klingholz, director of the Berlin Institute for Population and Development.

  “It will be very difficult, probably impossible, to generate overall growth,” he said.

  Europe is the world’s fastest aging major region. If it is to avert a future of decline and generational strife, economists say the only thing it can do is adapt — radically.

  Klingholz and others argue that if Europe can face up to and resolve its demographic deficit first, the region may be well placed to capitalize on its experience as countries like China and South Korea run with only a short timelag toward their own, far more rapid, phase of population aging.

  But how on earth is old Europe, with its 8 trillion euros (US$10.7 trillion) of debt, industrial age attitudes and dyed-in-the-wool labor structures, to reach this brave new world?

  What may surprise Europeans is the fact that, at least in some countries, the demographic deficit is not a new issue.

  Consider these comments from a report by a British government task force that examined the shape of the work force in the context of a fast-aging society.

  “We face a need for quite radical changes in long-established attitudes towards the older worker and retirement,” the report said. “The change in structure of the population requires a similar change in structure of the working population.”

  That report was dated Sept. 11, 1953.

  At that time, Britain found the solution to its labor force needs in married women working part-time and a wave of immigrants who, particularly in the 1960s, fueled the post-war growth that helped fund today’s pensions.

  “Sometimes I feel as if I’ve been going round and round and round this,” said Bernard Casey, an economist and public policy analyst at the Institute for Employment Research at Warwick University, who has been working on age and employment for the last 30 years, in the UK, in Germany and for the OECD.

  Even in Britain, which researchers have found to be relatively accommodating of older workers who are more often unable to afford inactivity, Casey’s experience points to a lack of strong political will to persuade employers to keep older workers, who are typically expensive, in employment.

  He said even Britain’s government suggested early retirement as a cost-cutting solution in a major 2004 review.

  He also recalled how Norbert Bluem, a former German minister for labor and social affairs, steered an early retirement law through parliament in 1984 and appealed to older workers to take advantage of the opportunities “in the interests of the unemployed and of younger people.”

  A few days later, this time in his social affairs role, he was appealing to Germans to work longer “in order to protect the long-term sustainability of the public pension system.”

  “It is the contradiction between the short and the long term which is what we spend all our time worrying about,” Casey said.

  Part of the problem might stem from different perceptions of age. Where in some industries, the phrase “too old to work at 40” can still resonate, when politicians deal with “old” people they tend to address the concerns of the elderly.

  People like Robinson, who took up his current job after retiring from a mobile home firm at 68, do exemplify moves toward the goal of retaining older people in the work force.

  The European Commission has targeted a 50 percent employment rate for older workers by this year, up from 45 percent in 2007. That average conceals very wide variations across the region, from about 13 percent in Hungary to 63 percent in Sweden, Allianz said.

  The participation of older workers has increased in recent years — particularly in part-time jobs for men like Robinson, whose employer, retail chain B&Q, has for decades made a public point of its enthusiasm for older staff. Still, only 28 percent of B&Q’s employees are aged over 50, which as a proportion is short of their increasing number in society.
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