Younger Workers Getting the Axe; Older Workers Getting Jobs

 by John Zappe, Jul 28, 2009

CareerBuilder says unemployed older workers are having a tough time finding jobs. A survey released last week says only 28 percent of workers over 54 laid off in the past 12 months found new jobs compared to workers 25-34 who are quicker at finding work. In that age group, 71 percent found a job within 12 months.

As a result, says CareerBuilder, 63 percent of the 55 and up group have applied for lower-level jobs, including entry-level positions and even internships.

That’s probably not much of a surprise to recruiters; 37 percent of them told CareerBuilder they have received applications for entry-level jobs from retirees and workers over 50.

What may well come as a surprise is the rise in older workers and the impact the recession is having on their ranks.

Layoffs and job losses have hit the younger workers hardest. According to data from the Bureau of Labor Statistics in the 18 months since January 1, 2008, the number of workers in the 25-54 age group has declined by 5.1 million. For workers over 54 though, there are 624,000 more working. In fact, there were gains in the number of older employed workers in every age group the BLS tracks except one — 55-59 year olds who saw a modest decline of 79,000 in the 18 months.

Before you point out that the sheer number of older Americans has been rising, which is certainly true, consider for a moment the participation rate. Based on a monthly survey conducted by the U.S. Census for the BLS, the participation rate is independent of population size. It describes the percent of various population groups in the labor force.

The data shows that for the last 10 years, more and more older Americans are working. Since 1999, the percent of working Americans 55-64 has grown by 10 percent, while the over 64 age group has jumped — and that’s an apt word — by almost 40 percent. Contrast those changes to the 25-34 year olds who have declined from 84.6 in 1999 to 82.9 percent for the six months ending in June.

In the 61 years for which the BLS has data, this many older Americans have never been employed. In the mid-50s the percentage began to rise until 1967 when, at the peak, an average of 62.3 percent Americans aged 55-64 worked. The percentage began to decline until it bottomed in 1986 at 54 percent of the age group working. There it remained, rising modestly until the recession of the 90s when it started its upward climb.

 Even more dramatic has been the number of those 65 and over reentering the workforce. For years, between 11 and 12 percent of retirement age Americans have worked. In 1998, on average, 11.9 percent of the 65 and over group worked. In June, it was 16.8 percent.

The explanation for the uptick in older Americans working is not too difficult to guess at: Longer life spans, better health, and access to health insurance whether private or through Medicare, the decline of the defined benefit pension coupled with the increase in the Social Security age, and, in the last two years, the recession, which has devastated many workers 401(k)s.

The implications, however, are harder to forsee, as is deciding if this is a structural change in the American labor force or a temporary economic blip. A BLS economist told me a colleague of his is researching these very questions.

Regardless of the cause of the return to work by older Americans, there’s no denying the graying of the workforce. For the first six months of this year workers 55 and over accounted for 21.8 percent of the labor force. That’s the highest percentage since 1971.

Meanwhile, the percentage of 25-34 year olds has taken a nose dive. From a high of 36.6 percent in 1986, the percentage has dropped 11.5 points to 25.1 percent for 2009. For the 25-54 year age group as a whole, there’s been a decline of almost eight points since 1993, when 86 percent of the workforce fell into that age group. For the first six months of 2009, 78.2 percent do.

Consider now the demographic factors we’ve detailed: an aging workforce, reentry into the workforce by workers who in years past would be retired, lower workforce participation by workers in the entry-level age group of 25-34, and, finally, the sheer reduction in employment by that age group caused by layoffs and other factors.

The implications of this are immense for employers and recruiters.

Among them is the increase they are seeing in mature workers seeking jobs. That 37 percent of recruiters who told CareerBuilder they’ve received applications from mature and retired workers for entry level jobs is, therefore, not that much of a surprise after all.

Even though the CareerBuilder survey says 65 percent of the employers report being willing to consider overqualified candidates, the reality is probably closer to the 44 percent of mature workers who say they’ve been told they are overqualified. Recruiters who reject overqualified mature workers may find it increasingly difficult to find the young workers who might otherwise take those jobs.

Should recovery from the recession prove to be as long as some economists are now fearing, retirements will continue to get pushed off and retirees with diminishing payouts from their 401(k)s and other savings will reenter the workforce at an accelerating pace.

Evidence of the former is in the CareerBuilder survey. One in five employers report being asked by employees to postpone retirement. Most of those employers (86 percent) said they would consider it.

If the demographics are any guide, 100 percent may come to wish they did.

Motivate Employees with ‘Flexible Fridays’

As with many small business owners, I belong to a number of online social networks including Twitter and Facebook.  I frequently review postings from other members to identify interesting information that I believe will be of value to my target customer, small business owners. 

In reviewing some recent Twitter postings, I came across one from Amy Nichols the CEO of the franchise organization, Dogtopia.  Her posting regarding the ‘Flexible Fridays’ program at her company struck me as a concept that other business owners might have interest in using in these days of high gas prices, long commutes and 60-hour work weeks. Therefore, I asked Amy if she would write an article to share her program with our readers.  The resulting article is below.  I hope you enjoy it as much as I did. (By the way, as a former D.C. area resident myself, I can absolutely attest to the traffic difficulties Amy discusses in her article; I assure you, I would have been thrilled to have an employer who believed in ‘Flexible Friday’s’ when I lived there!)

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Flexible Fridays

Washington, D.C. is known as our nation’s capital, but it also has another national moniker, that of one of the worst cities for traffic in the country.  Forbes ranked us in the Top 3 Worst Traffic Cities with the likes of Los Angeles and San Francisco. http://bit.ly/ForbesWorstCitiesForTraffic

Commuting in our area is grueling, and after leaving the “rat race” seven years ago to start my own business, I thought I had found a way to truly control the time I spend in my car.  I opened a doggie daycare, Dogtopia, just seven miles from my house.  Our business hours had me commuting outside of the most congested periods of the day, and I felt that I had solved the problem.  No longer would I be subjected to hours of wasted time in my car.  Until I decided to expand the business, that is.

A few years later we decided it was time to grow Dogtopia.  We had great success with the first dog daycare franchise in Tysons Corner, VA and felt it was time to add a “sister store” in North Bethesda, MD.  The new Maryland store would be only 14 miles from the Tysons Corner location – an easy commute between the two.  Or so we thought.  Apparently, the Wilson Bridge that takes you over the Potomac River and from Virginia into Maryland, had other ideas.

Skip forward a few more years and we are now a growing franchise company with 20 locations across the country.  We also have over 30 employees, six of which are in franchise management and report daily to our North Bethesda location.  The North Bethesda location now houses our national headquarters and training center.  Since we began the business in Virginia, that also happens to be where the majority of our corporate staff  lives, thus the daily undertaking of the Wilson Bridge.  The result, I was back to where I started eight years before and dealing daily with the horrors of DC traffic!

It occurred to me last summer that it would be quite easy to work from home on Fridays, and I felt that I deserved a day free from commuting.  My second thought was that my employees would really enjoy working from home on Fridays.  And if I could do it, why couldn’t everyone on our management team?  They would each save two hours or more in daily commuting time, and could therefore have an earlier start to their weekend and more time with their family.  I even came up with a clever name, “Flexible Fridays.” 

The way the program works, you can work wherever you want, but there are a few rules:

  1. Must be available by phone
  2. Must be online and available in email
  3. Must be on Instant Messenger

 The first two are quite obvious; the third requirement is because even when in the office, I often use IM to communicate with my team.  I might have a quick question while on the phone with a vendor or franchisee and it prevents me from having to yell and/or put the person on hold. 

Our initial ‘Flexible Fridays’ program last Summer worked great!  Knowing they had at least one day per week where they could avoid traffic really improved the outlook of the staff, and I know they appreciated my gesture.  There have been a few frustrations, but the slight inconveniences are more than outweighed by the increased satisfaction felt by my staff.

 This year I decided to once again offer ‘Flexible Fridays’ and so far, so good.  Other times of the year it would not be possible due to franchisee training and other commitments, but it has become a nice Summertime perk, and one that I plan to continue indefinitely.

Managing Virtual Employees

 

By Nipa Shah, June 18, 2009

Nancy is a financial analyst working for a mid-sized company located in the United Kingdom, but she lives in Michigan. She works from home in her pajamas and “meets” her boss once a month via video conference.

She is a virtual employee enjoying one of the perks of working from home and leveraging technology to stay in touch with her boss.

Companies across the globe are leveraging technology to retain resources that no longer have to be located in the same building or even in the same country. It is commonplace to hear of an individual working for a multinational company and having never met another team member.

By creating a virtual workforce, companies have been able to create efficiency, reduce travel and overhead costs, and essentially service the end-customer 24/7. Virtual employees, on the other hand, benefit from having a better work-life balance due to flexibility in working hours and not having to dodge rush hour traffic to be at work at a specific time.

Companies, however, face a common concern when it comes to virtual teams, that of measuring an employee’s productivity. Since the employee is no longer under a manager’s nose per se, managing productivity through “oversight” is impossible. Another concern is keeping an employee motivated and connected to company happenings.

The virtual team requires a shift in managerial and employee behavior. Here are some best practices which can effectively help you manage virtual employees:

Level Set Expectations
Beyond the policy and procedures set up by human resources, be sure to level set your expectations with your virtual employee, in a one-on-one discussion. Specifically state how you’d like him or her to keep in touch, how often, by what means (e-mail, chat, phone), and what deliverables you expect to receive at various times during the week. By level setting expectations in a more personalized manner, you create a better working relationship with your virtual employee and also plan for corrective action in the future.

Trust Employees
This is an important responsibility for a manager even when managing an on-site employee. It is an even more important responsibility when working with a virtual employee. Lack of trust can lead to micromanagement, which is never productive. Refrain from micromanagement in the form of “urgent e-mails” and “urgent voicemail” on a daily basis, which can create friction and unproductive working relationships between manager and employee. Trust the employee to do the work assigned and to turn it around in a reasonable timeframe. Once expectations are set, trust the employee to perform and do the work as assigned.

Provide Tools and Support
Virtual employees may require additional support to ensure their productivity. They could run into technical issues when connecting with a company local area network, or they could have issues sending large files through the firewall. All these issues need to be promptly addressed so that productivity is not impacted. Tools such as a BlackBerry, fax, access to resources and webinars, etc. should be offered to ensure employee can do the job.

Create an Inclusive Environment
Just because an employee is virtual it doesn’t mean he or she should be isolated from corporate events and happenings. Virtual employees still need to be included in team meetings, conference calls, town hall meetings, and other events so that they feel as if they are part of the corporate culture. 

Communicate, Communicate, Communicate
The importance of communication cannot be overstated. Even with all the technology in the world, it is important to do more than “staying in touch.” On a regular basis and without micromanaging; keep in touch, ask questions, participate in dialog, provide feedback, ask for feedback, etc.  Do everything necessary to stay in touch with your virtual employee so that you have clear communication.

A virtual workforce can be a blessing for companies and individuals alike. To make it work effectively, everyone involved will need to learn new skills and techniques. A successful virtual workforce can help a company save money and increase efficiency. Implement the above strategies and create a dynamic virtual workforce for your company!

Nipa Shah is president of Jenesys Group, LLC, an online marketing and Internet solutions company, providing technology consulting (with emphasis on offshore management) and online marketing. She is also the founder of the Michigan India Chamber of Commerce. Shah can be reached at nipa@jenesysgroup.com.