Benefits of Older Employees

by Dillon Kato

A new study by the AARP spells out the benefits of businesses hiring older employees for job openings, including higher work ethic and lower turnover.

The report follows statistics from the U.S. Bureau of Labor Statistics which found that Montana has the highest percentages of workers aged 55 and older in the nation at almost 28 percent. The same data showed more than 41 percent of all Montanans ages 55 and above are working. The state also ran the percentage of 65-and-older Montanans in the workforce, at 8.6 percent.

The AARP study predicted that by 2022, around 35 percent of the labor force in the U.S. will be older
than 50, as compared to 25 percent in 2002 and 33 percent in 2012.

According to AARP’s study, hiring workers aged 50 and older does not lead to significant increases in employment costs. Changes in benefit programs have led to a more even distribution of the costs of
employees, and the study concluded that hiring older workers may end up increasing labor costs by only
one to two percent. It also found that workers aged 50 and above have a 29 percent chance of unexpected turnover, as opposed to 49 percent for lower-aged employees.

Steve Reiter, senior operations specialist with AARP Montana, said one of the factors for Montana’s
high senior employment that many people leave Montana after finishing school to take better-paying
jobs out of state, and only return to Montana later in life.

“I mean, that’s me. I left the state in my early 30s, and now I’m in my upper 50s and I’m back,” he said.

Before moving to Montana, Reiter worked with AARP in Washington state, where he ran one division
of the Senior Community Service Employment Program. The federal employment training program places people 55 and older into part-time assignments at nonprofits and public agencies.

The work is paid through funding from the Older Americans Act, with the goal that the experience will
help people returning to the workforce develop skills and training through the job placements.

“The agencies receive much-needed help at no cost. It’s a supplement to their labor force,” Reiter said.

“They also receive very dedicated and loyal part-time participants.”

Reiter said the biggest employment challenge for seniors is landing a job to begin with.

“The competition that goes into it is tough, from the interview and applications process to developing
a network of people to help them,” Reiter said.

In Montana, the Senior Community Service Employment Program is managed by an organization called Experience Works, with offices and position placements across the state.

One of the Missoula agencies that takes part in the program is Home ReSource. Executive Director Katie
Deuel said the relationship has been beneficial both for her organization and the people that have come in to work with them.

“It’s important for us to have folks who provide diverse experience and life skills,” she said.

Beyond retail experience and green-building skills, Deuel said the most important benefit to the senior
employees is what she termed “soft skills” such as having a set work schedule and responsibilities, and
working as part of a team day to day.

“We’ve had a number of folks that went on and found other jobs. One of them is the voice on the radio for one of our radio ads,” Deuel said.

Her own employees at Home ReSource also see a benefit. Not only is work being accomplished that would not have been done without the seniors from the program, but Deuel said they also share some of their own perspectives to the generally younger workforce.

“They come in a way that is so much richer because they have been around in the world,” she said.

Debbie Lester, chief financial officer at Missoula Aging Services, said the proportion of older working Montanans mirrors the trend of the state’s population demographics.

“In 2025, Montana will be fifth in the nation in percentage of people 60 and older,” she said.

She said that is due, in part, to seniors who are working later into their lives because people are living longer, and because some of them had their retirement portfolios get hit hard by the recession.

“With our low-wage jobs, seniors do have to work longer,” Lester said. “They maybe have never been able to save for retirement that would be adequate.”

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