Karl Moore: This is Karl Moore of the Desautels Faculty of Management at McGill University, Talking Management for The Globe and Mail. Today I am speaking with Peter Cappelli, who is a senior professor at The Wharton Business School at the University of Pennsylvania.
Good Afternoon, Peter, it's nice to see you again.
Peter Cappelli: Thank you, it's nice to be here.
KM: Older workers - as we see the demographics in North America and Europe, this is certainly an issue we are working with. What are some of the things you are thinking about in terms of how we manage and work with older workers?
PC: Well, I think there are a few things that are quite interesting about this situation. One is of course the demographic change - it's not so much the baby boomers (there is a lot of attention given to the baby boomers as an effect in the demographics) - it is life expectancy. We are living about seven, eight years longer than our parents' generation in about 1960, and we are living healthier. So we are in much better shape and we are living longer and that raises, obviously, some interesting challenges. One is, if you thought of old as being affected with ... infirmities that make it difficult for you to work, if you think of that definition of old, then the proportion of people in the population who are old is actually shrinking, because so many of us are living longer and healthier. So the total number of healthier years in your life is much bigger than it was in the past, the total number of typically sort-of age-related infirm years is a smaller percentage of that now longer block.
KM: So, Bismarck 65 is no longer the thing?
PC: Yes, Bismarck set the retirement age at 65 at about the point when life-expectancy was in the '50s, so that was the outer edge of what you could possibly expect and now, I think, the odds are that if you and your spouse both hit 65 there is a 90 per cent chance, or sorry, a 50 per cent chance that one of you will live into your '90s.
So, life expectancy continues to go up. So the first issue is that people are living a lot longer, and they have to work longer in their current economic situation in order to pay for a longer life and they want to, too, because work is invigorating, work is a way of engaging people in society, especially in Western societies where maybe pay more attention to work. So people want to work longer, they have to work longer, and there are many more of them.
The problem is, age discrimination is huge and endemic: age discrimination by a lot of measures is a bigger issue than it is for race or gender. It is perfectly okay for everybody to tell jokes and make fun of old people, but you would never think about doing that for other groups. The reason this matters so much is because older workers otherwise seem to represent exactly what employers want on almost all measures of job performance, in fact if you are curious, I will tell you what the other one is where they are not, but on every other measure of job performance older workers do better - they perform better in terms of their jobs, their attendance is better, their interpersonal skills are better, we think that is becoming increasingly important, and they offer employers now sort of a just-in-time work force, particularly those who hit normal, typical, retirement ages want to work someplace often a little different for a relatively short period of time.
They are not looking for retirement benefits, they are not looking to stay on for a long-term career, they want a just-in-time job and that's what employers want. So you'd think this was a match made in heaven - better quality workers ready to step in for just-in-time roles, but in fact they can't get jobs and they can't get employed, they are discriminated against especially in hiring. The reason is, because of younger supervisors. So the problem with older workers, the problem they are facing, is that younger supervisors don't want to hire them because, frankly, they are afraid of them.
They are afraid to hire older subordinates because they don't know how to manage them. How can I hire somebody who is more experienced than I am in this job and expect to manage them? So they don't know how to manage them, and as a result, they are afraid of it and they won't do it. So that is the heart of quite a serious social problem that is only going to get worse as we go forward. So, the kind of study we did was to look at the context of the problem and think about how younger supervisors can actually effectively manage older workers, and why it makes sense for employers to do it.
KM - This has been Karl Moore of the Desautels Faculty of Management at McGill University, Talking Management for The Globe and Mail.