The economic and social logic of re-employing able and fit workers till age 67 should obviate the need for legal coercion. Yet, such is the weight of ageist notions and legacy systems, like seniority-based wage practices, that many employers still see themselves yoked to a liability when obliged to do so.
Hence the promotional approach recommended by the Tripartite Committee on Employability of Older Workers (Tricom) to bring more bosses on board voluntarily before that obligation becomes law. It took five years of exhortation before legislation was implemented in 2012 for bosses to re-engage their workers from age 62 up to 65. There is no reason for Tricom to take as long for the latest age extension.
A confluence of factors throws into sharp relief the business logic of viewing human resources holistically rather than stereotypically. In a labour-tight market, characterised by skilled foreign worker curbs, the experience of mature workers ought to be viewed as an asset.
Companies elsewhere with the organisational will and imagination have demonstrated how even a so-called "pensioners line" in a plant can achieve productivity levels of younger teams. An experiment by BMW saw work improvement resulting from shopfloor changes initiated by older workers themselves, including the addition of more user- friendly computers and wood floors to reduce knee strain. The extension of these changes, requiring just modest investments, to its other factories in Germany, Austria and the United States has led to similar productivity gains.
A tripartite effort here to promote better age management practices has highlighted various benefits that employers can derive. These include meeting labour shortages with less effort (given existing mature staff's familiarity with work processes), leveraging in-house experience and expertise, helping to promote organisational loyalty, and strengthening the brand by adhering to fair and socially enlightened policies.
State funds were earlier made available to employers to help them adapt human-resource systems and redesign jobs for seniors. Wage support schemes are also being sought. But how long can these continue?
Companies will have to be adept in operating willy-nilly in a world that is greying at an unprecedented rate. The number of workers supporting each German pensioner by 2030 will be 1.5 - half the number today. Here, for every person aged 65 and over there will be 2.1 working-age citizens, compared to 6.3 now aged between 20 and 64. There will be both economic opportunities and challenges in a middle-aged society, with a median age of 47 in 2030. For businesses to be future-ready, these issues have to be addressed now.