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UK – Four generation workforce soon to become a reality

24 March 2014

The UK Commission for Employment and Skills’ (UKCES) vision for a "4G" future is one where employees from four generations will work side-by-side for the first time in history. It will also be a situation that will be welcomed and not feared. 

However, businesses will be at a competitive disadvantage and experience further skills shortages unless they start planning for the changes now. That's according to the latest research from the Chartered Institute for Personnel and Development (CIPD), the professional body for HR and people development, which shows that employers and employees see clear benefits from an increasingly age diverse workforce but need to do more to take full advantage.

UKCES Commissioner Toby Peyton-Jones has questioned whether this emerging multi-generational workplace will spell stress and culture clashes or create positive tension leading to innovation. However, the CIPD's study of nearly 3,000 employees and over 900 employers points strongly to the latter.  Almost a third of employees saw no challenges whatsoever in working with colleagues from different generations, with employers and employees in agreement that knowledge sharing and greater innovation are by far the leading benefits. 

However, despite the gains to be made, CIPD's research, 'Managing an age-diverse workforce', reveals that many businesses are still ill prepared to capitalise on the opportunities that an age diverse workforce can bring:

  • Nearly a third (31%) of employers say that they react to issues relating to the ageing population as they arise rather than having a strategy in place.
  • Indeed, rather worryingly employers are most likely to say (34%) their organisation does nothing to ensure it has access to enough skilled and diverse people of all ages.
  • A fifth of employers say their organisation (22%) has no provisions in place to ensure employees of all ages develop and keep their skills up to date.
  • Nearly half (46%) of employers said that line managers are not trained in managing teams of different generations and that their organisation has no plans to change this. This seems to be an oversight, particularly in the light of 1-in-5 employees believing their managers to be ineffective in this area. 

Claire McCartney, Research Adviser at the CIPD, said: "Despite well-publicised skills shortages and low productivity, our research shows that businesses are not doing enough to recruit from an increasingly age diverse talent pool. And even amongst those companies that are, many simply aren't equipped to manage their age diverse teams in order to maximise their potential.  This is a missed opportunity and could put businesses at a serious disadvantage in a four-generation future.”  

"The good news is that both employers and employees recognise the benefits that workers from different generations bring. Indeed, fears of intergenerational tensions in the workplace couldn't be further from the truth. Companies report important business benefits such as knowledge sharing and enhanced customer service, while employees clearly enjoy the new perspectives and fresh ideas inspired by working with people of diverse ages.”  

Ms McCartney continued: "To capitalise on these opportunities, businesses must be much more proactive. They need to do more to tap into the variety of skills an age diverse workforce can bring and ensure they are able to support the extension of working life. Practical and immediate steps they should take include employing strategies to bring in and develop talent of all ages and providing line managers with more support. 

"We know that the multi-generational workplace is on the horizon, and businesses need to act now if they want to be prepared," she added. 

Other key findings from the report include: 

  • Organisations today seem to be fairly age diverse between the ages of 18-64 but very few (just 1%) currently have employees aged 65 or over (compared with a median 20% of 25-34-year olds, 35-44-year-olds and 45-54-year-olds and a median 10% of 18-24-year-olds and 55-64-year olds).
  • Employees are far more likely to recognise the opportunities for innovation created by age diverse teams than employers. While almost half of employees (41%) identified access to new ideas as a key benefit, only a small minority of employers (7%) cited greater innovation as an advantage of age diverse teams.
  • People are planning to work longer. The highest proportion of employees surveyed (38%) is expecting to retire between the ages of 66-70, while 16% are realistically expecting to retire after the age of 71.This is followed by nearly a third (31%) who are expecting to retire between the ages of 61-65 and 11% between the ages of 56-60. Very few employees are expecting to retire before the age of 55 (4%).
  • The initiatives that organisations are most likely to be using to support the extension of working life include: flexible working options (42%) and a flexible retirement policy (30%). However, three out of ten (30%) employers report that they don't offer any support for the extension of working life.

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