A whopping 150 million jobs will shift to workers over the age of 55 by 2030, according to a new global study from Bain & Company.
In the Group of Seven countries, Bain predicts, older and experienced workers will make up more than quarter of the workforce by 2031.
“That’s a massive shift,” Andrew Schwedel, partner at Bain & Company, told CNBC’s “Squawk Box Asia” on Tuesday.
“Japan is already at the vanguard of this with almost 40% of the workforce over age 55. Europe and the U.S. are not far behind, [with] anywhere from 25 to 30%.”
But an aging workforce isn’t unique to developed markets — China’s elderly population (65 and older), for example, will double by 2050, according to the study.
“Fewer young people are entering the workforce, due partly to lower fertility rates, partly to longer education,” Bain added.
“According to OECD data, a long-term trend toward earlier retirement is slowly going into reverse.”
The spike in retirements during the early months of the pandemic now looks more like “a Great Sabbatical,” Bain said.
What older workers want
In recent years, countries around the world have been increasing retirement ages — but not without pushback.
In France for example, an increase in the pension retirement age to 64 from 62 sparked protests earlier this year.
“One thing I hear consistently when I talk to companies is they don’t have the talent that they want in the quantities that they wanted,” Schwedel added.
That is why he advised businesses to not wait for policies to be implemented in countries, but to “put in place targeted interventions.”
According to a 2020 global employer survey, only about 4% of firms were committed to programs that help integrate older workers or support a multigenerational workforce.
“Companies that invest in recruiting, retaining, reskilling, and respecting the strengths of this group will set themselves up for success as the demographics of the workforce continue to shift,” Schwedel added in a press release.
The key to that is understanding what motivates older workers — Bain’s survey of 40,000 workers across 19 countries found that priorities evolve with age.
The study found that the average worker younger than 60 years old is primarily motivated by good compensation. However, those older are most focused on doing “interesting work” in a job where they have autonomy and flexibility.
“Many are focused on mastering their craft, while others feel rewarded by seeing their actions make a positive social impact,” the report said.
Schwedel added, “Motivations are different by individual and they change throughout one’s career.”
“That speaks to some of the different things that companies need to do if they’re trying to appeal to younger workers versus older workers.”
How to retain older workers
It is also crucial for companies to design workplace experiences that tap into the motivations of older workers, said Schwedel.
That can be done by equipping them with the skills needed in the next 10 years, according to Bain. For example, 22% of respondents aged 55 to 64 said they need more tech skills.
“For older workers to take advantage of training programs, companies need to design programs that appeal to their pursuit of interesting work and encourage supervisors to motivate participation across all age groups,” the press release added.
Lastly, companies need to respect these workers’ strengths and allow them to do “what they do best.”
That can happen through mentoring opportunities in which they help others master their crafts, Bain said.
“Bringing older workers’ unique benefits to the workplace can strengthen workplace culture for everyone.”