This is the third of a 3-part series on The New Majority: Millennials, Perennials and Parents.
Very few companies are (yet) looking at the issue of longevity, let alone managing it. Insurance company Aviva is a rare exception. In 2018, it launched what it called The Mid-Life MOT (in the UK, annual car check-ups are referred to as MOTs). They offered workshops reviewing the ‘3 Ws’ of Work, Wellness and Wealth for employees over 50 (later lowered to 45 by popular demand). It was a confidential review of future plans and financial feasibility. The response was enthusiastic – the programme sold out within hours.
The impact was also immediate and measurable. Employee confidence and engagement, measured before and after the meetings, rose significantly, explains Alistair McQueen, Aviva’s Head of Savings and Retirement. Aviva knew it was on to something and started broadening its offering from its own employees to its client companies, as a commercial service. Then the UK government picked it up and put it on its own website as a best practice example. But as McQueen says, “only about 1 in 10 companies has any appetite – yet – for this sort of planning.”
At Aviva, it had started with a recognition that a third of their 17,000-strong UK workforce (of 37,000 globally) was over the age of 45, and was the fastest growing segment of their employee base. The company’s ‘Generations’ Community Group was sharing anecdotal stories of 50-year-old employees sitting down for their annual performance reviews and being told “this shouldn’t take long,” implying that their career development days were behind them. Management wanted to send out a loud and unequivocal message that employees would be invested in and developed at 55 in the same way they were at 25.
Interestingly, companies that are leaders in gender balancing may find they have a competitive edge on the adaptations required for a multi-generational workforce and customer base. The older end of Aviva’s employee demographic is male dominated, and the younger end far more gender balanced. The company isn’t formally studying the overlap between longevity and gender, but McQueen notes that they are getting strong pushback on some misguided assumptions they may have had in launching the programme. “In particular, we’ve been hearing from women in their 50s that they have more to give than at any point in the past 25 years. They are just taking off and they don’t want to hear anything about winding down. On the contrary, their mantra is more ‘I’m back!”
To prove that point, for the first time in the UK, there are more women working aged 60-64 than not. Overall, the data shows that nowadays workers either aren’t ready or can’t afford to head into retirement at the traditional age of 65. Pension pay-outs are being nudged backwards by governments. Longevity, combined with changing gender roles, mean that the demographic of workforces is dramatically shifting.
And yet, at the same time, the UK has been suffering a dramatic fall-out of employees in their 50s. Aviva’s sobering overview is called the Storm on the Horizon, a report documenting the coming age disruption. As the UK’s leading pension provider, managing the financial futures of some six million people, they have a front row seat. At age 50, current labour participation rate of adults is 90%, but this drops to 50% by age 60 and to almost nil by 65. It will be further hit by the fallout of the pandemic.
Many of the current generation of people leaving the workforce are supported by final-salary retirement plans, but as McQueen, remarks, “the next cohort won’t have that option.” Very few companies are yet thinking about this challenge. Aviva’s goal is to gain a competitive edge in retaining top talent of any age by understanding and responding to the needs of older workers. “When the storm hits,” says McQueen, “Aviva will reap the rewards of preparing for it.”
If companies and attitudes keep pace with the change then the opportunities for economic growth are enormous confirms a new report of G20 countries from the International Longevity Centre. “Policy makers are so fixated on the direct costs of ageing that they fail to notice the significant and growing contributions that older people make. This prevents them from fully realising the social and economic potential of older people – and from appreciating the potential longevity dividend.”
Companies and countries can unleash the upside of longevity and the decades that have been added to lives and careers. Huge parts of the population may only just be getting started. They just don’t know it yet.