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No 56                                                                               May 2005

Employers Shun Baby Boomers

21/04/2005 07:43 AM - Kelly Sinoski - The Independent

How old is "too old" when you're looking for a job?

In many cases, the cut-off point is around 45. But, in some cases, it can be as young as 29.

Despite a skills shortage and a 3.6% unemployment rate - the lowest in 19 years - recruiters say New Zealand employers are still shunning ageing baby-boomers in favour of young graduates and skilled migrants.

They rarely cite age as the reason. In fact, this is illegal under the Human Rights Act.

Instead, older job-seekers are told they're "too well skilled, too knowledgeable and too experienced" for many jobs, says Debbie Loveridge, chief executive of Clayton Ford Recruitment.

But employers are being urged to hire workers 45-plus to fill the gaps in our tight labour market.

Unless they become more flexible, recruiters say, they won't have much talent to choose from.

Ageing baby-boomers, young graduates heading to jobs overseas, fewer skilled migrants, a falling birth rate and lower wages compared with Australia and Britain have already shrunk the talent pool.

According to a report by Hudson Global Resources last year, within the next 50 years people over 65 will comprise 26% of the population, compared with 12% in 1999.

This means a heap of senior, experienced people will quit the workforce with too few skilled young people to take their places.

Roger Tweedy, general manager of Work and Age Trust NZ, says a concerted campaign of some form is needed to push the skills and expertise of 45-plus people, particularly in a tight labour market.

"Supply and demand does create some interesting situations where people look at a wider group of candidates but prejudice is still pretty rife," he says. "To me, there's a whole campaign needed just to say we need to start thinking a little wider and that maybe your next apprentice might be 50."

Older workers have more going for them than the reams of experience on their CV. They are also reliable, trustworthy and loyal. In most cases Loveridge says, they will probably stay longer and work harder.

Young people, on the other hand, are much more likely to take their training and disappear overseas, or allow themselves to be headhunted.

She notes many Gen-Xers (born between 1966 and 1981) and the next generation, the Gen-Yers (born between 1981 and 1995), have different attitudes to older workers.

While the baby-boomer wants to serve the company, the younger generation, though more technically savvy, wants to know what's in it for them.

They have higher - and less realistic - aspirations, such as wanting to be CEO within five years. This makes them difficult to retain.

It's often cheaper - and a better investment - to retrain older workers than to train new graduates.

Tweedy says many older workers have set themselves up as contractors and maintained their skills. But employers still aren't biting.

Part of the reason, he says, is a 35-year-old CEO interviewing a 50-year-old candidate may feel threatened by the candidate's experience. But he says these older workers aren't ambitious in the sense they want their boss's job. They often just want to do their 40 hours a week, make a difference and go home.

"People perceive someone older is obviously more experienced, more ambitious and a threat and that's often not the case. But changing attitudes is a long process," Tweedy says.

"The bottom line is, in the recruitment world, they say 80% is a personality match and 20% skills and experience. If they're feeling threatened or don't get on, people aren't going to make the appointment."

But Bank of New Zealand senior economist Tony Alexander predicts companies will be forced to start hiring experienced employees as the labour market tightens even further.

Alexander says some employers are already hiring older workers after being burnt by inexperienced young employees with low productivity and attitude problems.

One Christchurch firm was so fed up with the high turnover of staff it decided to hire older women. The other plus here is there is little, or no, risk of these women having children - therefore employers don't face the disruption of parental leave.

"I think what we're going to find is a transition over the next few years toward older workers because of their work ethic and experience," Alexander says. "There will be increasing demand and acceptance."

Fletcher Building doesn't have a specific policy on hiring older workers but many staff members are 50-plus, says Peter Merry, general manager of human resources. He says experience ought to be an advantage but says the company will take the best person for the job, regardless of age.

"There was a time in years gone by when, if you reached a certain age, you had slowed down or were less competent," he says. "I'm not sure how much of a reality that is now."

Roman Rogers, general manager of Hudson Global Resources in the South Island, said employers are already moving toward older workers as they become more aware of the benefits of their experience.

According to the Hudson report, stereotypes suggesting older workers lack innovation or creativity, are too expensive to employ, can't cope with new technology or are not willing to be retrained are disappearing.

This is more true in the South Island, where there's a higher population of older workers.

But Rogers says at the same time, some employers are prejudiced against younger workers, citing a perceived lack of loyalty and productivity.

He urges employers to find the best person for the job, regardless of age.

Given the changing environment, companies need to strike a balance and some younger workers have different working styles than the over-45 group.

"It's educating employers on what makes a successful team," he says. "A healthy environment is made up of a combination of employees."

But all this cuts no ice with some employers.

To attract young people or retain those already working for them, companies are pulling out all the stops.

Employers are offering flexible hours and training and development. Some banks are matching wages to keep employees, while large accounting firms such as Ernst & Young are offering to send new graduates overseas for training or searching offshore for staff.

Anna Williams, national manager of accounting and financial services at Hudson Consulting, says companies are starting to hire directly from overseas rather than hiring migrants already here.

"Companies are being pretty fussy about who they take," Williams says. "You will still find in many cases that if you have someone who is 50 or 60, they have too much experience and won't fit in with the culture of the company."

But Tweedy says the culture is about to change with the huge number of older workers swelling the ranks.

He said although Australia appears to be ahead of New Zealand in accepting older workers, there are still states where prejudice is rife.

A mining expansion in Western Australia, for example, was put on hold because of a purported skills shortage. One of the needs was for truck drivers - a job that hardly requires a university degree.

"With the system of CVs, in that type of process age or ethnicity can, and does, get screened out," he says. "It's when you're confronted with a CV, even if it's hidden, that has all the signs that person has been around a while, maybe set in their ways."

Changes to the Human Rights Act 1993 made age discrimination illegal and removed compulsory retirement. The statute prevents "wanton or covert discrimination that would repress individual aspiration, achievement and self-worth."

Yet overt and illegal discrimination does exist. Accountant Kevan Moroney, 40, says he was offended when he was refused a job in Tauranga because he was considered too old. In his case, the accounting firm wrote to him, citing his age as the reason he wasn't hired.

Moroney took his case to the Human Rights Commission and won. At the time, he was only 29 and had just finished his accounting degree after 10 years as a freezing worker.

He says he was a bit disillusioned but soldiered on, eventually finding work in his field.

"They wanted a young person who wouldn't answer back," he says. "I just wanted an apology but they never gave me one."

He says he has been lucky because of the desperate need in New Zealand for accountants.

Doug Alderslade, a partner with Chapman Tripp, says he doubts most companies would be so crass as to cite age when refusing to hire an older candidate.

But he says many employers may be cautious hiring someone older because if they turn out to be incompetent, they would find it difficult to terminate their contract because of their age.

"The experience that sort of age group has is invaluable but I suspect there's a variety of reasons why employers would be cautious in some situations," he said.

But, he adds, companies should consider how much they will get out of the worker. "Someone like that is more likely to stay with an organisation and improve themselves."

Bruce Goldsworthy, manager of manufacturing and advocacy services for the Employers and Manufacturers' Association (Northern), says he wouldn't hire an older worker if the person was too qualified for the job.

If the applicant was an experienced toolmaker of 48-50, he would "snap him up quick" because of the skills shortage. But if an experienced older worker were applying for a job as PA to the chief executive, he wouldn't be keen.

They wouldn't be sufficiently challenged, he says, or get the money they wanted and would probably end up leaving.

"I'd say, quite frankly, your qualifications are way over the top for the job offer," Goldsworthy says. "All you'd be doing is bringing somebody in for three to four months, then recruiting again. It would be a costly exercise."

Another problem for companies is training costs, he says. Often companies pay to train young workers who are then headhunted by competitors.

Alexander agrees, saying older workers are likely to be more stable than younger people because they have lived through 30 years of high unemployment and low job security, thus making them grateful to have a job.

"The older person has three decades of labour market worries," he said. "It's a concern that older workers aren't being recruited. The optimum thing here is doing optimal service for New Zealand, getting more New Zealanders in the workforce. They have a choice to train them up or import from overseas.

"My recommendation to employers is try to maintain a social service here by focusing on Kiwis first, rather than looking overseas."

Gilbert Ullrich, of Ullrich Aluminium, says his company is trying to recruit older workers because it needs their skills and experience. He has also recruited eight welders from India to fill the skills shortage.

Ullrich says most of his staff have been with the company for 20 to 30 years. "I take them in all shapes and sizes," he says. "Experience is what matters and their ability. No company should waste an opportunity and let people's experience be unused."

Human resources consultant Jennifer Wyatt-Sargent says older workers who keep their skills up-to-date add value to an organisation. They can also mentor younger workers.

In the early 1990s, British DIY chain B&Q staffed its store entirely with 50-plus workers. Compared with other stores, it found profits were up 18%, employee turnover was six times lower and the store experienced less absenteeism and staff theft.

Mitre 10 Mega in Henderson doesn't have a specific policy to hire older workers but tends to have quite a few over-45s because they are more knowledgeable about the store's products. They are also nurturing young apprentices, a human resources spokesman says. The spokesman, who didn't want to be named, says companies should grab the experience of older workers because it won't be around forever and it's a huge investment to train young people.

The Warehouse also has a huge pool of 45-plus women, mainly because it offers flexible hours.

"Employers worth their salt would be looking for people like that to come in and give their company an edge," Wyatt-Sargent says. "I firmly believe there is work for those who keep themselves up to speed."

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