More evidence that older workers add the greatest value

“Millions of workers who plan to stay on past retirement age could force up employer costs and hold back younger staff,” is how the Daily Express  summarises the results of a recent survey by life assurance company Canada Life.

The survey, apparently, shows that 35 per cent of the UK’s workforce intend to continue in their jobs beyond 65 now that compulsory retirement has been abolished.  Companies are urged to review their insurance policies and place heavy emphasis on the need for cover to cover critical illnesses.

 One might have expected this from Canada Life – after all the company is in business to sell insurance. “Life expectancy is improving, but mortality increases with age and the increased risk of insuring an older workforce will be reflected in higher premiums,” gloats Canada Life’s spokesperson Paul Avis.

A little objective reflection would be welcome

Avis continues: “For these older workers, health care provision and products such as critical illness cover will become an ­increasingly attractive part of their employment package. We would advise all employers to take into account the impact of the change to the average retirement age and review their benefit packages accordingly.”

Pardon my scepticism, but this sounds more like a marketing pitch than a serious piece of research.

Leaving aside an understandable desire to sell their products, it is hard to see the rationale for such dire warnings to employers.

Statements suggesting companies offer carrots to attract people to retire – not a policy that would, one imagines find favour with the Government as they encourage us to extend our working lives as we are living much longer and pension costs soar – are somewhat near  the mark when we are supposed to have a right to work longer.

The Canada Life ‘research’ amounts to an online survey of “over 1,600 UK employees” hardly (one would have thought) a major investment of resources in demographic and medical science..

It all adds up to a piece of cheap marketing puff – don’t believe all that you read in the papers!

In fact, one has to wonder whether this is not a question of someone stirring up controversy for the sheer hell of it. After all, the “Granny pinched my job” story is the sort some papers seem to love to run.

My feeling is that lining up the soldiers of some kind of pseudo intergenerational War of the Roses, is what this is all about. As the saying goes, never let the facts get in the way of a good story.

Avis urges employers to “… take into account the impact of the change to the average retirement age and review their benefit packages accordingly..”

Well that would be good for business wouldn’t it?

Apparently, employers should all go off and speak to an adviser “… to ensure they are getting the most for their money (and so that)  they won’t be faced with an unexpected bill.”

Well, well. I can hear the cash registers ringing.

What a pity that Canada Life didn’t consult others who have researched this area, somewhat more thoroughly.

In Managing the Ageing Worker,  a book published by Harvard Business Review Press in 2010, the authors conclude their review of evidence saying “….the overall conclusion from all this research is that for virtually all jobs in virtually all circumstances, workers with more experience are almost always the better performers. Any negative effects of age on performance are so minor as to be irrelevant.”

In fact, older workers do report more work- related illnesses but in contrast they have fewer work-related injuries, a point the insurance companies should surely acknowledge.

And while on average, older workers tend to take a few more days off sick than the youngest employees, the difference is relatively small and younger workers are more likely to take odd days off here and there, which can be more disruptive.

The striking thing is that the oldest employees tend to take fewer days off – a phenomenon known to researchers as ‘the healthy survivor effect’. (They mean that employees in poor health are more likely to retire, leaving behind the fittest and least absence prone employees; a sort of survival of the fittest, in fact.)

Whether the Canada Life research does offer evidence to support the company’s suggestion that working longer will cost employers more is a moot point. My hunch is that they have not done a cost-benefit analysis, lining up the costs on one side of the page and benefits on the other.

It would be nice of them to do one. I am sure we could all trust them to add up!

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