Age Management for the Common Good

Abstract

In the aftermath of the COVID-19 pandemic and amid the present reconfiguring of corporate purpose, there is an opportunity to realign actions focused on prolonging working lives. We put forward a transformative agenda concerned with workforce ageing that aligns with contemporary expectations regarding sustainability, inequality, and emerging conceptualisations of management. In this article, the new concept of Common Good human resource management (HRM) is utilised as a potential means of encouraging business responses focused on grand challenges such as population ageing. We suggest how these principles might be applied to the issue of managing age in workplaces, to recast debate about issues of age and work, to be used as an advocacy tool encouraging employer engagement, while providing a framework that might direct organisational leadership.

Introduction

We propose a new framework for responding to issues of workforce ageing and the employment of older workers, drawing from current notions of sustainability and contemporary perspectives concerning the management of human resources. The ageing of developed nations, often couched in terms of the threat it supposedly poses, has brought into sharp focus issues of the reform of retirement income systems and prolongation of working lives (Lain, 2016; Phillipson, 2019; Taylor, 2019) as nations have sought to offset the potential for lower economic growth and rising welfare costs associated with large numbers of inactive older people. Meanwhile, among the developing nations whose populations are now also ageing rapidly, the issues are made even more stark as they have fewer resources and are less economically prepared to respond (Lai and Yip, 2022). However, they have the benefit of potentially drawing lessons from the experiences of more developed nations that have been grappling with the issues for much longer and through a variety of policy and practice approaches, many of which have been trialed and evaluated.

Substantial public policy and advocacy expertise associated with workforce ageing has built up over many years. The 2030 Agenda for Sustainable Development explicitly focuses on mainstreaming ageing issues, implementing a life course approach, building the intersection of ageing with other critical issues, enhancing coordination and cooperation at all government and organisational levels, and encouraging age-sensitive and all-age-inclusive policy development (UNDP, 2017). Specifically with regard to addressing the international policy agenda of prolonging working lives, the International Organization for Standardization (ISO) has recently released standard ISO 25550:2022 ‘Ageing societies – General requirements and guidelines for an age-inclusive workforce’ contributing, it states, to eight of the Sustainable Development Goals (SDGs): SDG 1 No poverty, SDG 3 Good health and well-being, SDG 5 Gender equality, SDG 8 Decent work and economic growth, SDG 10 Reduced inequalities, SDG 11 Sustainable cities and communities, SDG 12 Responsible consumption and production, and SDG 16 Peace, justice, and strong institutions (ISO, 2022). This comes on top of measures in many countries focused on awareness raising and increasing employer demand for older workers (Sonnet, et al., 2014; Taylor and Earl, 2016). Influential international bodies such as the Organisation for Economic Cooperation and Development (OECD) have stressed the importance of legislative measures outlawing age discrimination in employment coupled with the promotion of good ‘age management’ practices to increase employment opportunities for older workers (OECD, 2019a).

Yet while longer working lives are considered an essential response to population ageing (OECD, 2006, 2015) at the workplace level progress has been slow. There has been a recent upward trend in retirement ages across the OECD member states (OECD, 2018). Evidence suggests that the efforts of OECD member states aimed at postponing retirement, particularly in terms of statutory retirement ages and financial disincentives for early retirement, have been significant determinants of longer working lives (Kuitto and Helmdag, 2021; OECD, 2018). However, the OECD (2018) argues that greater progress in increasing the effective age of retirement has been stymied because of inadequate efforts to reduce employer barriers to recruiting and retaining older workers and promoting employability over a working life.

Considerable attention has been paid to understanding the determinants of and potential responses to ageism in the workplace, with factors such as organisational structure and hierarchy, workforce age profile, company size, organisational values, stereotypes of younger and older workers, industry sector, human resource management (HRM) practices, and legal frameworks being considered (Naegele, et al., 2018; Petery and Grosch, 2022). More broadly, it is argued that societal representations of age appear to be persistent (Taylor and Earl, 2021), framing organisational level narratives regarding the employability of workers and the timing of their retirement (Taylor, et al., 2022). Efforts targeting labour market age barriers have invoked concerns about an organisation’s ‘bottom-line’ by presenting employers with so-called business cases for employing older workers. However, criticism charges such approaches with reflecting, not addressing, societal representations of age, for encouraging ‘fair weather’ employer action, or for being discriminatory (Taylor and Earl, 2016). Instead, market forces are identified as the ‘villain when it comes to the business case for keeping older workers’ (Arman, et al., 2022: 2606), organisations using this as a pretext for only keeping a select few who are considered to have desirable qualities that make them sustainable in their jobs, with human resource managers playing a supporting role in identifying such workers, while working out how to handle the rest (Arman, et al., 2022). Thus, amid intense debate about the importance of prolonging working lives employers have tended to be problematised, not viewed as competent or willing partners.

Nonetheless, there now appears to be a greater prospect of business engagement with the topic, with a corporate focus on shareholder value recently superseded by a commitment to adopt a multi-stakeholder approach to value creation. The Business Roundtable (2019) which represents the USA’s largest companies recently released an updated ‘Statement on the Purpose of a Corporation’. Notably departing from its long-held position that corporations exist principally to serve shareholders, the revised statement identifies the following areas of stakeholder engagement, whose long-term interests the Business Council considers inseparable:

• Delivering value to customers.

• Investing in employees, which includes fair remuneration and important benefits, providing development opportunities leading to skills that can equip them for the future, and fostering a climate of diversity and inclusion, dignity, and respect.

• Dealing fairly and ethically with suppliers, which involves acting as good partners.

• Supporting the communities in which companies operate, showing respect for people, and protecting the environment by embracing sustainable practices.

• Generating long-term value for shareholders.

While drawing criticism for contrasting with the manifest behaviour of some of these corporations (Winston, 2019), the statement does point to the prospect of an alliance between business and government in tackling major issues of common interest such as the future of work (OECD, 2019b). Here, the importance of cooperation has been made stark in the context of the social re-evaluation occurring in the COVID-19 pandemic aftermath, where known risks for workers – many of them older – in frontline care roles were highlighted (Krzyzaniak, et al., 2021), strengthening calls for workforce reforms focused on job quality (Osterman, 2019) and amplifying existing problems with labour supply (United Nations, 2021). It has been noted that among the developing economies with large informal labour markets, large service sectors, and rural workforces, less welfare support, and a slower roll-out of COVID-19 vaccines, older workers may have been disproportionally affected by the pandemic (Pit, et al., 2021). Meanwhile, during the pandemic, long-standing arguments that question the value of older workers resurfaced, such as concerning early retirement as a job creation mechanism (Taylor, et al., 2022), thus framing older and younger as competing for jobs: the so-called ‘lump of labour fallacy’ (Taylor and Earl, 2021; Yerkes, et al., 2022). This suggests that, even in the face of considerable educational efforts, societal attitudes to older workers may not have altered substantially, which raises questions about the achievements of decades of advocacy, public policy, and research. That such efforts have fallen short may reflect the interplay of a range of factors: first, some age advocacy itself is influenced by and perpetuates ageist assumptions and generational stereotypes; secondly, that age interacts in complex ways with many other facets of a person’s identity in determining their labour market experiences, and thirdly, the existence of institutional frameworks and social norms that undermine efforts to encourage and support longer working lives (Taylor and Earl, 2021). This is explored further in the second point in the following section.

Such concerns potentially add momentum to opportunities for concerted action focused on extending working lives. Emerging from the convergence of drivers and enablers identified above, is the potential to implement a transformative reform agenda to workforce ageing to align with contemporary expectations of sustainability, commitments to reduce inequalities, and emerging conceptualisations of HRM.

A new discourse for workplace practice concerning ageing and work

From a business perspective, an adequate framework for sustainable competitiveness necessitates ‘taking into account the economic, socio-cultural, and environmental dimensions on the one hand and the consideration of all stakeholders on the other’ (Vrabcova, et al., 2022: 174). Such a perspective makes it possible to tie present economic and social imperatives concerning the utilisation of older workers against a backdrop of concerns about a shortfall of labour supply as people retire in ageing populations to environmental notions of the preservation and renewal of finite resources (Vrabcova et al., 2022). It also potentially overcomes some of the tensions that might exist between short-term business objectives narrowly focused on maximising shareholder value and human capital notions of treating workers as a long-term investment (Kooij and van de Voorde, 2015).

We extend this idea by drawing from the Common Good HRM framework (Aust, et al., 2020) which we see as aligning closely with the Economy for the Common Good (ECG) model and its emphasis on socially oriented values and job quality (Ollé-Espluga, et al., 2021). Common Good HRM sets out an approach to managing people that marks a fundamental shift in how the purpose of business is conceived. Its core responsibility contributes to sustainability challenges by treating collective interests as at least equal to those of individuals and organisations. The primary focus of HRM in contributing to economic purpose is replaced by one of supporting organisational leadership in contributing to ecological and social progress. Here, HRM capability is deployed in addressing the ‘grand challenges’ of our time. In a nutshell, it involves four principles: looking beyond an organisation’s boundaries or adopting an ‘outside-in’ perspective in responding to a grand challenge including the SDGs; recognising that equal and fair employment relationships are essential for Common Good HRM to achieve trusting relationships and organisational success; that all stakeholders should be given opportunities for participation and representation to achieve locally adapted solutions to complex challenges; and that the psychological employment contract will be upheld in terms of job security, safety, and meaningful work.

In the following section, we offer some preliminary suggestions as to how these principles might be applied to the issue of managing age in workplaces, to recast debate about issues of age and work, to be used as an advocacy tool that encourages employer engagement, while also providing a framework that might direct the actions of organisational leadership.

The first and primary principle is an outward-oriented organisational perspective and a focus on grand challenges, such as those codified by the UN’s 17 SDGs, for instance SDG 4 Quality education, SDG 8 Decent work and economic growth, SDG 10 Reduced inequalities, and SDG 17 Partnerships for the goals. The United Nations Economic Commission for Europe (UNECE, 2019) explicitly links the policy agenda of prolonging working lives to the achievement of the SDGs: ‘Tackling ageism in the labour market will help to form age-inclusive and age-diverse workplaces that offer equal opportunities for all generations. This will contribute to enabling longer working lives and ability to work in the region’s ageing societies to make the most of the potential of longevity.’ While this is a long-standing view and one that is shared by many, the principle of an ‘outward-in’ perspective is potentially valuable in defining HRM’s purpose in terms of its role in bringing the organisation’s resources and capabilities to bear in attempting to address societal concerns. This contrasts with a traditional ‘inside-out’ perspective which frames organisational activities in terms of minimising business risk and maximising shareholder value (Aust, et al., 2020: 3), partly reflected in efforts aimed at defining business cases for employing older workers described earlier.

At first glance, persuading an employer of the need to respond to population ageing might seem like a straightforward proposition. After all, this grand challenge is one that has been the subject of much commentary, numerous official and semi-official inquiries, a large volume of public policymaking, and business awareness-raising campaigns. Yet, advocacy on behalf of older people is not without criticism with, for instance, efforts focused on challenging notions of ageing potentially confusing societal discourse. Thus, the Stanford Center on Longevity states that its mission is to accelerate and implement behavioural practices and social norms that make century long lives healthy and rewarding (Stanford Center on Longevity, 2020). Yet in a recent report – The New Map of Life – it invoked ageist stereotypes in asserting that: ‘The speed, strength, and zest for discovery common in younger people, combined with the emotional intelligence and wisdom prevalent among older people, create possibilities for families, communities, and workplaces that haven’t existed before’ (Stanford Center on Longevity, 2022: 25). It has been argued that there are potentially more effective ways of engaging with industry.

Beyond the existence of ageism in older people’s advocacy, as noted already, flawed arguments for the use of early retirement as a job creation mechanism resurfaced in the wake of the COVID-19 pandemic. Added to this, it has been pointed out that there is a need to consider the heterogeneity of ‘older workers’ (Bal and Jansen, 2015) and that complex interactions among factors, such as ethnicity, social class, occupation, and industry sector, in determining experiences of work at older ages casts doubt on the utility of the term at all (Phillipson, 2019). Consequently, social policy and advocacy targeting ‘older workers’ may have limited effectiveness. Similarly, there may be problems in operationalising such an imprecise concept at the firm level. Moreover, issues of ageing should be considered alongside the other dimensions of the future of work: technological change and globalisation (OECD, 2019b).  For example,  Phillipson (2019: 641) suggests recasting the approach to one aimed at ‘improving work quality and security as a precondition of any policy for encouraging working in later life’, an interpretation which potentially overcomes problems inherent in the focus on merely prolonging working lives. These he identifies as the nature of work and the characteristics of workers, tackling skills deficits, and the potential of present approaches to accentuate inequalities in work and retirement.

In response and building on recent efforts to reinvigorate debate via the concept of the longevity economy (AARP and Oxford Economics, 2016), we propose adding a sustainability perspective that moves beyond efforts to define policy and advocacy agendas narrowly focused on ‘older workers’, and instead adopting a life course approach (Amick, et al., 2016), considering for instance, the downstream consequences of labour market inequality among younger people (United Nations, 2018). A sustainability discourse also emphasises the importance of building and deploying partnerships between stakeholders for dialog, problem-solving, and action (Munck and Tomiotto, 2019). Consequently, HRM professionals potentially have a role to play in facilitating the involvement of workers of all ages in the development of age management strategies focused on developing and embedding shared organisational values concerning age inclusivity over a working life. Given the lack of evidence for the crowding out of younger by older workers, the OECD (2013) has identified a need for mutually reinforcing employment strategies, for instance, fostering intergenerational partnerships. Such an approach would emphasise the value of generational dialog and solidarity, responding to disjunctions and contradictions inherent in an age advocacy that has hitherto often focused solely on the needs of ‘older people’ (Taylor and Earl, 2021).

Second, it should be recognised that HRM professionals are embedded in sociocultural contexts in which they learn and develop attitudes that shape their practice regarding older workers. These are powerful influences and, as noted already, ones to which even older people’s advocates do not appear immune. Here, HRM professionals can benefit from recent efforts to address conceptual gaps in terms of intersectionality from an organisational perspective (Woods, et al., 2022). Guided by Common Good HRM’s principle of equity and fairness, effective age management, thus, rests on an underpinning recognition that given ageism can be experienced at any age (World Health Organization, 2021), equity for older workers does not come at the expense of that for younger workers, and vice versa; similarly, current egalitarian advocacy – that endorses less prejudice against and more support for women and racial minorities – may lend support to ‘succession’-based ageism, which prescribes that older people make way (Martin and North, 2022). This raises issues of balance and proportionality, which are complicated when considering that the prevalence of age cohorts is different across occupations, industries, and countries and consequently a perceived sense of disadvantage may not easily be addressed. Furthermore, HRM’s commitment to the principle of equity and fairness needs to filter down to the line management level that may exert a stronger influence on daily working lives, including employee well-being, satisfaction, and retention and upward to senior leadership that can do most to model appropriate workplace behaviours and influence organisational culture. Consequently, HRM will play a key role in fostering a multi-level and multi-layered approach that would potentially avoid actions in one domain that could be at odds with ones in another.

Third is the notion that all stakeholders have a role to play in achieving age equality and fairness. This could include networked employer partnerships to enable better resourced, larger-scale employers supporting smaller-scale employers that lack HRM capability in implementing age management strategies (OECD, 2019a). While size is not the only factor in enabling action, this approach would especially equip larger employers to contribute as social role models, not only in supporting other employers but for supporting wider society. Alongside the many companies that are already implementing policies and codes of conduct aimed at mitigating human rights violations in supply chains (SDG 8) (Australian Government, 2018), a leadership commitment to the cause of common good may help curb the possible tendency of some managers to harbour ageist attitudes. For instance, promoting alternative examples that recognise sociocultural influences and emphasise counter-stereotypical and inclusive practices might change behaviours. Yet modeling good practice alone is not sufficient localisation and contextual relevance are required (Rohwerder, 2017). This can offer a starting point for implementing a transformation of employment relationships, for instance, in cases where employers in upstream supply chains might perceive the need to respond to cost pressures by dismissing older and more highly remunerated staff. Research demonstrates that while smaller businesses have some understanding of issues of workforce ageing management responses are nascent (Egdell, et al., 2020).

Fourth, the Common Good HRM framework assumes that the employee’s psychological contract will be maintained in terms of protecting the human need for secure, safe, and meaningful work. This might involve an age focus during periods when organisations are in transition, for instance, in rejecting early retirement (Taylor, et al., 2022) in favour of efforts to retain workers of all ages or, as noted earlier, where different equality agendas might be in conflict. It would also challenge HRM to consider the needs of those whose abilities to adapt are socially stratified and unevenly distributed across the life course (Moen, 2013). Such an approach to HRM would thus emphasise the opportunity to undertake quality work (Osterman, 2019) over a (longer) working life given the influence of job demands on life expectancy (de Wind, et al., 2020) and the continued responsibility of employers as workers move into post-work or retirement phases, including those exiting workplaces early due to poor health or family-care responsibilities (Stiemke and Hess, 2022). Transforming post-work might include employer action in response to the inadequacy of pension arrangements, for instance, for those who experience fragmented or disrupted employment trajectories. With people nowadays often living in ‘post-retirement’ for considerable periods, yet with marked differences between occupational groups (Deeg et al., 2021), business may also play a role in reducing inequality and promoting healthy ageing by maintaining relationships with former employees.

Conclusions

Considering organisational actions focused on environmental sustainability, it is apparent that transformational change will not be achievable unless business leaders are willing to move beyond their ‘ideological core’ of a sole focus on the bottom line (Narayanan and Adams, 2017). Extending this principle, in this article, we identified that there is presently a unique convergence of factors that might facilitate meaningful and long-term workplace actions in response to issues of age and work. Pivoting to a transformative agenda to address these challenges, we propose a new approach for organisations that involves reframing work and building a new discourse of partnerships inclusive of all labour market actors.

Finding inspiration in the four principles of Common Good HRM, we outlined how an outward-oriented perspective can perhaps provide fresh impetus to current efforts focused on prolonging working lives. A stakeholder perspective draws younger people into the debate about the importance of age inclusivity over sustainable (working) lives. Focusing on equality and fairness instead of a purely economic agenda would reframe the experience of work. Solutions translated from other contexts could help businesses lacking HRM capability. Lastly, reframing the relationship between organisations and workforces could help ensure all are protected, secure, and safe and can engage in meaningful work over the long-term.

Attempting to apply these principles to issues of managing age in organisations in this article, and given this topic is one of many HRM professionals are expected to have knowledge of and grapple with on a day-to-day-basis, it is perhaps evident why progress to date has been limited. Age management may need to compete with a range of other organisational priorities and agendas, and so its potentially long-term focus may not be viewed favourably in the situation of a dynamic operating environment. As shown earlier, there is paradoxically a risk of diversity and inclusion agendas conflicting with the principle of equality and fairness. Realising effective age management, of course, is not entirely within the HRM professional’s purview. Added to this, such an approach seems inevitably more applicable to larger organisations with better developed HRM functions. Nevertheless, despite such limitations, as critical labour market actors, Common Good HRM perhaps provides HRM professionals with a new set of guiding principles and describes a transformed role for them that aligns with modern conceptions of business purpose, sustainability, and understanding of the importance access to work plays across the lifespan. Given serious labour shortages in many industries at present, the application of Common Good HRM to the topic of age and employment might also be considered timely and offer a potential solution to a pressing need.