Research project TA/00/32A (Research action TA)
The Belgian activity and employment rate of employees older than 55 is noticeably lower than the European average (EU-15). As a result of a higher level of education and the possibility to leave the labor market early, our labor market is characterized by compressed careers (Forrier et al., 2005). The period during which people actively contribute to social security is relatively short. The current debate about government policies to keep older employees in the labor force underlines clearly the priority of this theme for policy makers. “Active ageing” is also a priority at the European level. The Top of Lissabon formulated as a goal that member states should aim for an employment rate of 70% by 2010 (age 15-64). The goal is an employment rate of 50% for 55-plussers (cf. Stockholm, 2001; Barcelona, 2002). Today, it is clear that the progress made so far is insufficient to reach this goal. As a result the member states are stimulated to implement drastic measures (financial incentives, strategies for lifelong learning, and active measures for the labor market and improvement in working conditions). The social partners are also encouraged to introduce “best practices” in policies with respect to older employees.
This project aims to support the governement and its social partners in their decision-making process by: (1) raising awareness of the way the career of older empolyees takes shape (and how this is influenced by institutions, households and individuals); (2) introduce best practices at an institutional level concerning financial incentives, lifelong learning, labor market policy, and social security; (3) best practices at the organizational level, more specifically, to introduce HRM-practices for older employees and integration of older newcomers; and (4) to provide more detailed insights into the perceived link between the loss of experienced employees and company performance. To this end, we shall employ a multidisciplinary approach. Since it concerns a policy oriented project, an important contribution consists in a strong conceptual integration of the factors that influence career length as they are studied by different research traditions. This conceptual integration is translated into a research design that makes use of different data sources that are available at a national and international level.
The research consists of three phases.
In Phase A we shall study the aspects that influence the length of the active career. For this, we use the “Consortium of Panels for European Socio-Economic Research” (CHER), an integrated panel that compiles data of indivuduals and households as well as data about institutional characteristics. The analyses on the CHER data are validated through additional analyses on a set of European Labor Market Indicators that have been recently developed by the Policy Research Center Work and Social Economy, and through more recent cross-sectional data (European Labour Force Survey and Datawarehouse).
In Phase B we shall describe the profile of organizations active in employing older employees based on data available in Datawarehouse. The results function as input for case studies in 10 Belgian companies that hire older employees and invest in sustainable employment. We opt for case studies because of the lack of representative data about features that facilitate decisions concerning employment of older employees at the organisational level. The results of these case studies will be validated by means of 3 focus groups with a wider group of organizations.
In Phase C we further test the motives of employers through quantitative analyses of the impact of demographic characteristics of a company’s labor force on the company performance. This will yield insight into the economic rationale for employing older employees. For this, the information from annual reports of Belgian companies is linked to two data sources, particularly Datawarehouse and the files of an important social secretariat. We will study cost increases and value-promoting aspects of the population’s different age structures in terms of absenteism, turnover, productivity, and personnel cost and its impact on financial performance.
On the individual level, the following results are expected:
(1) The profile of Belgian employers with a long career (e.g. level of education, gender, sector, etc.)
(2) The impact of interim career transitions (e.g. career interruptions, mobility) and human capital (e.g. training or employability-promoting activities) on the length of the career.
(3) The impact of household characteristics (e.g. partner’s position in the labor force and income) on the length of one’s career.
(4) The impact of institutional policy measures on career length. The international comparative analyses will yield insight into the netto-effect of policy options while individual, household and employer characteristics are kept constant. The results will indicate whether, or to what degree, the same individual characteristics and household characteristics play a role in different institutional contexts.
On the level of the organization, the following results are expected:
(1) A descriptive overview of the morphological differences between organizations that employ a proportionately greater number of older employees; as well as the differences between organizations that hire relatively few older jobseekers. This quantitative information will be completed with qualitative information gathered from CLA’s about investment of organizations in older employees.
(2) The case-study research will produce detailed insights into the motivation and concrete initiatives of a sample of organizations that employ a high share of older employees. Focus groups of older employees within these organizations will then complete the information provided by the organization’s management. This way, the perceptions and the experiences of the target group are incorporated into the picture. The qualitative information extracted from the cases is important for policymakers, because it offers insight into the complaints of a crucial player in the debate on the end of the career. The focus groups from a wider group of organizations make it possible to formulate advice that accounts for a broader spectrum of organizational contexts.
(3) In order to map out the impact of the workfloor’s demographic reality on the performance of organizations, the insight of the case studies are attached to the quantitative information. This last part of the study enables to test certain assessments of employers by examening if investing in older employees is rewarding. Here the impact of the organization’s demographic composition (age, career patterns, age at time of hiring, reward structure, etc.) on the performances of organizatons is studied. The results will incite policies that can be used to convince organizations of the economic rationality of hiring older employees.
