Employers Adjustment to Longer Working Lives

Kène Henkens, Netherlands Interdisciplinary Demographic Institute (NIDI-KNAW)
Jaap Oude Mulders, Netherlands Interdisciplinary Demographic Institute (NIDI)

In recent history the Netherlands saw a lot of retirement-related policy changes as a result of population ageing. These policy changes culminated in 2012, when the Dutch government decided to gradually raise the eligibility age for the public state pension from 65 to 67, after which it will be tied to life expectancy projections. These policy changes have led to increased labour market participation among older individuals, but have had severe implications at the individual level, with individuals having to work much longer than anticipated. But not only employees are affected; employers also have to deal with increasing numbers of older workers who are looking to stay employed until higher ages than before. The increase in public pension age thus has a direct effect on organizations’ workforce composition, staff planning and opportunities for organizational restructuring. In this paper, we study employers’ adjustment practices to the new reality of employees’ longer working lives, using data from the NIDI Employer survey, which is a survey of 1368 Dutch employers’ attitudes, policies, and practices related to an ageing workforce and longer working lives, held in early 2017. We introduce a new measure of employers’ adjustment practices, categorizing a series of items related to adjustment to longer working lives into three main concepts: information (e.g., informing and supporting older workers in their retirement decisions); health (e.g., an increased attention for healthy working conditions and work-life balance); and person-job fit (e.g., accommodating older workers to other jobs within the organization). Using a structural equation model, we then estimate which employers are most active in adjusting their practices to deal with longer working lives of their employees. Preliminary results show that mainly larger organizations with more older workers actively adjust to longer working lives. Organizations from different sectors and with different workforce compositions adjust differently.

Presented in Session 96: Technological Changes in the Labor Market and Institutions