Demographic changes mean employers that fail to recruit, manage and develop older workers effectively will lose competitiveness reports the CIPD.

Bizarre though this sounds in view of the current high unemployment in the UK it is predicted that UK employers will need to fill an estimated 13.5 million job vacancies in the next ten years, but only 7 million young people will leave education over this period. Employers will increasingly need to rely on older workers to fill these vacancies.

New guidance published by the CIPD this month describes how being smarter at using a growing and relatively untapped talent pool makes good business sense and sets out practical ways of doing this.

In fact the recommendations made in the report - which are based on a year-long research programme – encourage employers who have so far failed to act strategically on this looming challenge to lose no more time in getting to grips with it.

The recommendations reflect the actions and experiences of leading-edge employers who are already driving this agenda and are rooted in the issues raised by HR practitioners and other stakeholders who took part in a number of national-level focus groups last year.

The recommendations also chime with labour market facts, which suggest that the appetite employers have to retain older workers is growing.

These facts show that older workers (50-64 and especially 65+) had a good recession. They are the only demographic with either stable or (in the case of 65+) rising employment rates. This on-going structural trend is forecast to continue and is highly desirable but employers will need to be capable of responding to it appropriately if they are to be successful in attracting as well as retaining, rewarding and motivating older people. Given that the peak age of caring is 45-64 this group of workers will also contain a sizeable number of carers juggling work and care.

The CIPD research highlights performance management and training of older workers as particular issues for attention. Approaches need to be far more robust and the guidance sets out how employers can do this in ways that will make sense to older employees.

The report suggests that the failure of employers to act on extending working life is based on a lack of awareness of the business case for strategic rather than piecemeal approaches. The extension of working life also has wider social benefits such as improved economic independence in the face of shrinking pension pots to name but one.

The CIPD’s encouragement to employers to focus action on improving employment opportunities for older people may seem at odds with the national concern about a lack of employment opportunities for young people. However, they suggest that the current shortage of jobs for the young is cyclical and will be resolved by economic recovery over time and that advocating fewer jobs for older people is shortsighted given the demographic changes that are shaping the labour market. They say that employers should also be alert to the fact that older workers are still more prone to redundancy and less likely to be quickly re-employed than workers aged under 35 and in the longer term this amounts to an unnecessary and untenable skills drain.

Profiling older workers as bed blockers completely misinforms understanding about the way in which extending worker life should be addressed. It is fortuitous that older people themselves are showing a growing interest in worker longer. CIPD research shows that older workers are increasingly looking to extend their working lives, with more than 50% of workers aged over 55 planning to work beyond the previous state retirement age.

The CIPD suggests that it is in employers’ interests to act quickly so as not to fall further behind their more alert competitors. If they fail to act they put at risk their own competitiveness.

Employers for Carers would urge employers to also consider the needs of working carers who will be amongst this age group to ensure that they retain skilled and experienced staff and are able to tap into a new recruitment pool of people who are wanting to return to work after caring or are looking to combine work and care.

Managing a healthy ageing workforce: A national business imperative, has been produced by the CIPD in collaboration with the Scottish Centre for Healthy Working Lives and is available as a free download.