Retirement optional

CARP studies how to engaging older Canadians in the workforce.

from the Canadian Association of Retired People

The right to work and remain engaged is under threat for many older Canadians. Systemic and informal ageism pressures older workers to "make room" for upcoming employees, despite the benefits of their experience, skills, and contributions to society. Government and employers have created barriers to continued employment based on negative attitudes and ageist practices towards older workers.

 

For many older Canadians, however, the traditional rules of retirement are no longer relevant. Continued engagement in the workforce provides social inclusion, promotes overall well-being, and most importantly, helps prepare Canadians for eventual retirement. As a result, older workers expect the same rights as all Canadians — to work free of discrimination and free of ageist barriers.

Today's growing population of older workers are politically active and ready to demonstrate their value to the economy and society. Governments and business have a vested interest in the continued employment of older workers, as older Canadians are not to be mistaken for a group that will sit back and accept the status quo.

Increased labour force participation

Older Canadians are staying in the workforce longer than in previous years.

• Since 2000, there has been an 11 percent increase in the rate of seniors aged 65-70 still participating in the labour force.
• From 1997 to 2010, the employment rate for men over 55 rose from 30.5 percent to 39.5 percent and for women it rose from 15.8 percent to 28.6 percent. The increase is a reversal of previous trends that saw fewer older men engaged in the workforce later in life and career. Older women have steadily increased participation in the workforce since the 1990's, but the rate of participation has increased in recent years.

Reasons for engagement

1. Work offers personal fulfillment, dignity, social inclusion, and physical wellbeing.
   • Studies have found that unemployment can cause higher levels of stress, depression and other mental disorders and even greater usage of hospital resources.
2. Work is a necessity that helps secure retirement and financial stability for Canadians without pension plans or adequate personal savings.
   • The financial crisis in 2008 led to a 21.4 percent loss of Canada's private pension funds.
   • Over 8 million Canadians do not have occupational pension plans
   • 72 percent of pre-retirees are concerned about maintaining a reasonable standard of living for the rest of their lives.

Barriers to workforce engagement
On average, older workers have difficulty finding re-employment and tend to stay unemployed once they're out of the workforce.

Barriers to workforce engagement include:

1. Interpersonal and systemic age discrimination
   • Many older workers feel that their contributions are unvalued by employers.
   • A recent Ipsos Reid poll found that 74 percent of those polled believed that workplaces discriminate against older workers who are looking for jobs.
   • One-third of the Ipsos Reid poll's respondents indicated that they have been a victim of age discrimination in the workplace or in a job interview.
   • Age discrimination is also evident systemically. In most workplaces, for example, insured benefits cease at a certain age, most commonly 65.
   • Until recently, mandatory retirement was legally permissible. Even with new legal protections, older workers will continue to be pressured to vacate positions.
   • Most caregivers in Canada are over 45 years old, but labour practices and laws discourage leave arrangements that would allow valuable employees to care for family without risk of lost employment.
2. High costs & wage loss
   • Relocating can be costly and a new job may mean lower earnings. In 2008, half of the older workers who returned to work experienced a wage loss of at least 25 percent compared to their their previous position.
   • Older workers may be more negatively affected when displaced from their established family and community connections.
3. Lack of flexible options
   • A UK study found that older workers prefer fewer hours of work, more control over their hours, and flexibility with their work arrangements. Such arrangements are most important to older workers who are also informal caregivers.
   • A larger proportion of older workers are in part-time, temporary, and self-employed work by choice, despite their experience and institutional knowledge. However, these work arrangements may be difficult to find, and tend to pay lower wages if they are found.
   • In 2011, 33 percent of Canadian employees over 65 were low wage.
4. Matching skills with opportunity
   • With the gradual loss of traditional manufacturing jobs and emerging new technologies and industries, workers need to adapt quickly to meet labour market demands. Unlike younger workers, older workers can face greater difficulty up-grading skills to meet new demands. Having certain specific skills and training is a particular challenge for those living in regions that had a dominant single employer or industry that has downsized.
   • New job application and hiring practices may leave some older workers behind, particularly those who have been continuously employed for decades and who are unexpectedly thrust into the job market. Social media and other new online resources in today's job market may be unfamiliar to older workers seeking new employment opportunities, which may frustrate and further exacerbate the loss of job-search confidence and motivation.

CARP recommendations:
The Federal and Provincial Governments have formally recognized the value of older workers, most notably in the federal transfer program Targeted Initiative for Older Workers (TIOW), which funds provincial programs aimed at securing employment for older Canadians. A comprehensive plan is still needed, both to help unemployed older Canadians looking for work and to help currently employed older Canadians retain employment. CARP is calling on government and employers to work together to create an employment landscape that recognizes the importance and value of older workers by removing barriers and providing job opportunities.

1. Remove barriers to continued employment.
   All levels of government should work together to remove systemic barriers and disincentives to work. Such initiatives can include:
   • making changes to the tax and pension systems to encourage continued employment;
   • inter-generational sensitivity initiatives that aim to counteract ageism and ageist practices from workplaces;
   • caregiver leave and support will help older employed caregivers to remain in the workforce. The program design should aim to provide choices and flexibility for older workers who wish to participate in the labour force;
   • allow eligible individuals to work and receive benefits while still contributing to a pension plan;
   • create employer incentives that encourage flexible time and salary opportunities;
   • require equivalent coverage for employees of all ages in employer-sponsored insurance benefits.
2. Help the unemployed older Canadians transition to new opportunities
   The federal and provincial governments have acknowledged the need to help older worker transition to new employment with the TIOW program; the initiative has limited application to small pockets of unemployed older workers. More support should be provided to help people transition by:
   • promoting and funding continuous learning and training throughout individuals' working lives;
   • further minimizing work disincentives associated with the Guaranteed Income Supplement claw back provisions;
   • continuing to promote phased retirement through facilitated changes in the tax and pension systems;
   • amending Employment Insurance rules to give older workers more time to find better matched new job opportunities.
3. Create job opportunities and promote the value of older workers
   Older workers have immeasurable experience and value that is often ignored or relegated to the sidelines through ageist attitudes and practices. The value of older workers is crucial to employers and society. It is expected that the future job market will face a lower supply of experienced skilled workers at the same time that their knowledge and experience is being marginalized. Government and business should act quickly to create opportunities for older workers. Such efforts will be important to both business and government, while helping more Canadians find meaningful employment, remain engaged, and secure eventual retirement.

   Governments should:

   • consider tax-incentives for employers that encourage the hiring and retaining of older workers;
   • create incentives for employer-based job fairs and placement agencies that match unemployed older workers with relevant opportunities in their fields;
   • encourage employers to allow flexible arrangements through mentoring programs from older to younger workers;

The benefits of engaged older workers
With retirement security increasingly out of reach for many older Canadians and with a looming skilled labour shortage, there are important reasons to proactively address the employment needs of older workers. Older workers who remain engaged benefit themselves, fellow employees, employers, and continue contributing to society and the economy.

Older Canadians — like all Canadians — have the right to keep working, free of discrimination and ageist practices. Older Canadians have a particular interest in this issue and it is imperative that government and business take action to ensure older workers can remain engaged in the workforce.

 

© Copyright 2012 Canadian Association of Retired People, All rights Reserved. Written For: StraightGoods.ca