EJML Senior workers final
Transcript of EJML Senior workers final
SMALL‐SCALESTUDY
THEIMPACTOFTHECRISISONSENIORWORKERS:CHALLENGESANDRESPONSESBYPES
ISMERI EUROPA
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 2
Authors and contributors: Andrea Naldini and Simone Capolupo, Ismeri Europa, Italy; Erhan Őzdemir ,
Applica, Belgium; Maria Petrova, National Employment Agency of Bulgaria and Iskra Beleva, Institute of
Economics, Bulgarian Academy of Sciences, Bulgaria; Timo Baas, IAB, Germany; Danielle Greco, Pôle
Emploi, France; Peter Stoks, UWV, The Netherlands; Izabela Grabowska‐Lusinska, University of Warsaw,
Poland.
The authors also acknowledge the contribution of Agnes Hars, Kopint‐Tarki, Hungary and Begoña Cueto,
University of Oviedo, Spain.
The work of the EJML is supported by the European Union’s Programme for Employment and Social Solidarity – Progress (2007-2013).
This programme is managed by the Directorate-General for Employment, Social Affairs and Inclusion of the European Commission.
For more information see: http://ec.europa.eu/progress
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Table of contents
Introduction: older workers in Europe and challenges for PES ......................................................................... 4
1. The European policy context ......................................................................................................................... 6
2. Labour market trends for older workers ....................................................................................................... 9
2. Labour market trends for older workers ....................................................................................................... 9
2.1 Europe is characterised by low levels of employment amongst older workers ..................................... 9
2.2 Recent trends and the impact of the crisis ............................................................................................ 18
2.3 The working situation of older workers ................................................................................................ 21
2.4 Unemployment among older workers and the effect of the crisis ....................................................... 23
2.5 Labour market transitions: the drift into inactivity ............................................................................... 27
2.6 Labour market transitions: re‐employment rates ................................................................................. 31
2.8 Labour market transitions: longer‐term observations .......................................................................... 34
2.8 Job‐search methods of older workers ................................................................................................... 37
2.9 Summary of main findings from the analysis of labour market trends ................................................. 39
3. Overview of national initiatives to support older workers ......................................................................... 41
3.1 Bulgaria .................................................................................................................................................. 41
3.2 France .................................................................................................................................................... 46
3.3 Germany ................................................................................................................................................ 49
3.4 Netherlands ........................................................................................................................................... 53
3.5 Poland .................................................................................................................................................... 57
3.6 Overview of employment subsidies in favour of older workers around Europe .................................. 60
3.7 Main findings from the case studies on PES experience ....................................................................... 64
4. Conclusion and policy considerations ......................................................................................................... 66
References ....................................................................................................................................................... 71
ANNEX: Supplementary data ........................................................................................................................... 73
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Introduction: older workers in Europe and challenges for PES
In Europe older people are less likely to be in work than the overall working age population. In 2010 the
employment rate of people aged 55–64 was 46.3% compared to 64.2% for the working‐age population as a
whole (i.e. those aged 15‐64) or 78.1% for those of prime working‐age (25‐49)1. This figure conceals
significant differences between Member States with the employment rate of those aged 55‐64 varying
from 30.2% in Malta to 70.5% in Sweden. Moreover, the level of employment amongst older workers in the
European Union lags a long way behind that in other major competitor economies ‐ in both the US and
Japan more than six out of ten people aged 55‐64 are still in work2.
The low participation rate of older workers has a number of negative implications for the European
economy in terms of underexploited human resources, a reduced potential for growth, difficulties in
managing the increasingly aged population, and a lack of intergenerational solidarity in sharing the fiscal
burden which leads, ultimately, to higher labour costs. The need for change is evident and clearly identified
in the Europe 2020 strategy, where the adaptation of welfare, flexicurity and life‐long learning systems to
support active ageing and an increase in the employment rate of older workers is explicitly addressed. The
current economic situation and the need for greater efficiency in public expenditure and more sustainable
public budgets make the need for action even more urgent.
The employment rate of older workers in the different EU Member States is strongly related to institutional
and economic factors and, in some cases, cultural and social factors. Active labour market policies (ALMP)
alone will not be sufficient to address the situation and comprehensive approaches are called for. However,
within the flexicurity approach, ALMP have a fundamental role alongside the adaptation of social welfare
systems. In countries where the participation of older workers is particularly low, both labour demand and
supply have to be supported in confronting new constraints imposed by pension reforms and in promoting
new behaviour able to support active ageing strategies.
In this context, public employment services (PES) have an important role to play in helping to address the
situation and keeping senior workers as close as possible to the labour market. On the one hand, the
economic crisis makes it more difficult for older unemployed people to find work and for those that lose
their job and become unemployed, the likelihood of falling into long term unemployment is higher than for
other age groups. On the other hand, maintaining the jobs of older workers requires that they adapt quickly
to changes in technology and evolving models of work organisation. Last, but not least, as the population
ages and the number of workers moving into the senior category increases in years to come there are
important implications for the operational capacity and existing service offer of PES.
Against this background, the study aims to analyse whether the current economic crisis adds pressure to
challenges posed by an ageing workforce and how PES can help to increase the employment participation
rate of older workers. The study is structured as follows:
Chapter 1 provides an overview of the European policy context with special attention to the initiatives of
the European Commission. It provides a strategic framework to the subsequent analysis and establishes the
responsibility of the PES for working with older workers within the broader context.
1 Source: Eurostat, Labour Force Survey: lfsa_ergan 2 Employment rate of people aged 55‐64 is 60.3% in the US and 65.2% in Japan, Source: Eurostat, tsiem020
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Chapter 2 examines the current labour market situation of older workers and how the crisis has impacted
on them in relation to other age‐groups and to longer‐term trends. Where relevant, differences such as
gender and educational level are examined. Chapter 2 also considers whether the gross employment rate
figures conceal other trends for older workers to work fewer hours or in atypical forms of employment,
including self‐employment. As older workers tend to experience longer periods of unemployment it also
looks at whether this has been worsened by the economic downturn. Similarly it investigates the problems
older workers experience in returning to work – due to the risks of long‐term unemployment or prolonged
inactivity, examining how long it takes for them to find a job, and the reasons for not seeking work. Finally,
it considers the main reasons why unemployed or inactive older workers left their last job and the methods
used to find a new one.
Chapter 3 provides examples of interventions and employment services implemented in selected EU
Member States (namely Bulgaria, France, Germany, the Netherlands and Poland) to keep older workers in
employment for longer, or to help them find a new job after they have been made redundant. This second
aspect is developed through analysis of national programmes implemented in recent years; a further
section gives an overview of the use of employment subsidies to support older workers.
Chapter 4 identifies the main policy implications emerging from the analysis and the main lessons for the
action of the PES.
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1. The European policy context
In the nineties, and especially after the 1993 crisis which saw a widespread use of early retirement
schemes, it became evident that that low levels of labour market participation amongst senior workers
were unsustainable against a backdrop of aging societies in most Member States. Since then, a large
number of reforms limiting or abolishing early retirement schemes, postponing retirement age and
strengthening preventive active labour market policy have been implemented across much of the EU.
The EU Council recognised and highlighted these issues by setting specific targets related to increasing the
labour market participation of older people and progressively raising the average retirement age at EU
level. The 2000 Lisbon European Council established the strategic goal for the EU of more employment,
economic reform and social cohesion in a knowledge based economy and recommended an employment
rate of 50% among older workers. As follow‐up, the 2001 Stockholm European Council established an EU
target for an employment rate of 50% for older women and men (between the ages of 55 and 64) by 2010.
The 2002 Barcelona European Council concluded that there should be a progressive increase of around five
years in the average retirement age by 2010. These initiatives demonstrated a fundamental shift in attitude
among policy makers who previously favoured early retirement as an instrument for ameliorating
unemployment (Taylor, 2008) and were in line with the “radical shift in policy … away from a culture of
early retirement towards comprehensive ageing policies” (COM(2004) 146) called for in the Kok Report
(Kok, 2004).
The European Commission has coordinated and addressed the active ageing process through the European
Employment Strategy (EES). In 2003 the EES, which aimed to create more and better jobs and increase
labour market participation, took on board the recommendations of the preceding European Councils and
stressed the importance of “making work a real option for all”, calling for a comprehensive approach to
active ageing and integrating ALMP with initiatives to retain workers longer in employment. Subsequently,
the 2005‐2008 Employment Guidelines addressed the need to increase the employment rates at both ends
of the age spectrum, to promote a life‐cycle approach that particularly targets younger and older workers,
and to match labour market adaptation to an ageing workforce (COM(2005) 141) (Pillinger, 2008).
The current Europe 2020 Strategy for smart, sustainable and inclusive growth recognises the risks posed by
a labour force that is projected to shrink as a consequence of demographic change and the need to
increase the level of labour market participation, particularly amongst women and both younger and older
people. In particular, Guideline 7 of the Europe 2020 Integrated Guidelines (Increasing labour market
participation of women and men, reducing structural unemployment and promoting job quality) focuses on
the need for policies to increase labour market participation. According to this guideline, flexicurity
principles should be integrated in national policies in order to ensure the right mix of activation and social
protection; in practice, flexible contractual arrangements, ALMP, lifelong learning and adequate social
security systems are needed to support all kinds of transition within the labour market. In this framework
“Member States should review tax and benefit systems, and public services capacity to provide the support
needed, in order to increase labour force participation and stimulate labour demand. They should promote
active ageing, gender equality including equal pay, and the integration in the labour market of young
people, people with disabilities, legal migrants and other vulnerable groups.” This guideline is to be
implemented within the context of the Europe 2020 strategy and the overall target to raise the EU
employment rate for women and men aged 20‐64 to 75% by 2020, with countries setting different national
targets according to their different starting points; in many EU countries this will demand a significant
increase in the participation of older workers. Guideline 8 (Developing a skilled workforce responding to
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labour market needs and promoting lifelong learning) provides further elements relevant to an active
ageing strategy by highlighting the need to promote productivity and employability throughout the working
life. To this end it is essential to upgrade skills systematically, in particular for the least well‐equipped
groups within the labour force, and to implement lifelong learning schemes. Furthermore, in the Europe
2020 strategy, the flagship initiative “An Agenda for new skills and jobs” provides further, more
operationally orientated, guidelines for reinforcing policy for older workers. This initiative commits the
European Commission and Member States to update and reinforce the flexicurity strategy, adapt the
legislative framework in line with “smart” regulation principles, promote the recognition of competences,
facilitate labour mobility, and promote partnership and capacity building in different contexts (mainly in
education and employment services); all these elements contribute to a more effective and sustainable
active ageing approach.
In addition, funding for specific interventions in this policy field has been provided. The European
Commission has estimated that within the monies allocated to the European Social Fund (ESF) for the
programming period 2007‐13 around 1 billion euro are being devoted to measures to promoting active
ageing and a longer working life. Older workers, along with other groups, can also benefit from active
labour market measures which account for around 15% of ESF resources (total budget of 75.6 billion euro
for the 2007‐13 period).
More recently, the European Commission designated 2012 as the "European Year for Active Ageing &
intergenerational solidarity" (COM(2010) 462) in order to help create better job opportunities and working
conditions for the growing numbers of older people in Europe.
This brief review of the European policy context for older workers implies two main things: a) the
adaptation of national labour markets to demographic change and the increased participation of older
people will take time and require complex structural reforms; b) this adaptation needs a comprehensive
and multidimensional approach capable of mixing changes in the social security and tax system, contractual
arrangements, health and social assistance, active labour market policy and lifelong learning. Such
developments need to be made in accordance with flexicurity and equal opportunity principles but cannot
be the same or advance at the same speed in all Member States and depend on the current conditions of
each individual labour market.
Fiscal and social security reforms can be used to generate incentives for both employers and employees,
but new cultures of working behaviour and attitudes to work also have to be facilitated and integrated into
practical and day to day practices and implementation. Thus, in all Member States the PES should play a
fundamental role within that policy mix, because they are usually responsible for a large part of ALMP and
for upgrading skills and, even in countries with high participation rate of older people, will have to adjust
policy instruments according to market transformations and implement “preventive” actions to reduce
demand and supply mismatching for this group. Dealing with ageing and ensuring labour market
participation of older workers means that national PES have to adapt their priorities and their operational
approaches.
A clear awareness of the role of PES emerges from some working documents of the PES at European level.
In a document of June 2010 on the future development of the role of PES3, based on a survey organised
through the heads of national PES in the network of EU & EEA PES, demographic change is considered as
one of the principal factors affecting their forward looking strategy making support for the most vulnerable
3 EC, ITEM 2: PES 2020 ‐ mapping visions and directions for future development; June 2010. Unpublished.
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groups and inactive people an increasing priority. Abandoning the simple dualism of employed‐
unemployed, broadening the range of target groups and strengthening the preventive approach through a
“lifelong service” approach are general indications that go in this direction. These require an enhanced
networking and partnership approach with all the relevant policy stakeholders, as well as a reform of
employment services in the direction of multi‐channelling and personalised services. In the document, the
development of lifelong learning services, as essential preventative measure, is emphasised and is an
important component of the ageing strategy as previously mentioned. Other documents of the network
echo these considerations; in a document of the PES Working Group 2020 most of the PES consider older
workers as a priority target group; here, lifelong learning initiatives and specific services for increasing the
employability of older workers are highlighted. The reinforcement of career guidance services is also an
important element of the preventative approach relevant to older workers.
There is clearly a need for PES to have adequate financial and human resources in order to cope with the
demands implied by a widening of the client base and the implementation of specialised services; however
in the current period of widespread public budget consolidation and reduced funding of PES it will be a
major challenge to achieve this aim whilst improving efficiency and delivering more for less. As a result, the
overall capacity of the PES to deliver the range of services required to meet the specific needs of older
workers may be limited and co‐operation and partnership with other organisations will be crucial.
In conclusion, among the national PES there is a clear awareness of the potential impact of demographic
ageing and the importance of increasing the labour market participation of older workers. For PES this
implies defining specific strategies for older clients, which include the involvement of employers and other
providers of social or employment services. In future, services for older workers should be addressed as
part of a broad and comprehensive lifelong approach, but at the moment there are still basic steps needed
to develop and refine appropriate services and approaches to meet the specific needs of older workers and
the evidence suggests that current experience of this is limited to relatively few PES.
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2. Labour market trends for older workers
The employability of older workers is becoming increasingly important. The population of the EU is ageing
and the ever increasing pressure that this places on pension and welfare systems is being borne by a
shrinking workforce in which older workers have a progressively larger share4. Yet levels of employment
amongst older workers are still a long way behind those in major competitor economies and leaving such a
large productive resource unexploited is economically no longer sustainable.
Working longer is often hailed as the best way to increase retirement incomes at the micro level as well as
to ease the burden of pension expenditure. Yet this strategy depends on the ability of older workers to find
work and/or hold on to their current job. Issues linked to the employability of older people are of particular
relevance in the wake of the recession period that began in 2007/2008, since when the demand for labour
has remained weak and unemployment rates in many EU countries have risen to levels unprecedented in
recent history.
This chapter examines the current situation and main trends for older workers in EU labour markets, how
the crisis impacted on the general trend towards longer working lives and compares the effects of the crisis
on senior workers with other age groups. The data on which the analysis is based are derived primarily
from the EU Labour Force Survey in the 2000‐2010 period and exploit the latest available annual data
referring to 2010 as well as historical data where relevant.
2.1 Europe is characterised by low levels of employment amongst older workers
Employment rates measure the proportion of the population that is in work and vary with age according to
a more or less similar pattern in all countries. Initially, rates for the younger age‐groups are low as
significant proportions of those aged under 25 remain in education. Thereafter, data for 2010 show that
rates for people of prime‐working age (25‐49) rise to a reasonably constant level and then gradually tail off
as people retire from active life (Figure 1). It is also typical that employment rates for women are lower
than those for men throughout the life course.
In relation to older workers, the point of interest is the rate at which the employment rate declines
between prime working age (25‐49) and retirement (taken to be 65+). If Europe is to better exploit the
capacity of its available workforce then more people will have to stay in work up to and beyond the official
retirement age, which means that the employment rates of older workers should remain closer to those of
prime‐age workers than they are today. As shown in Figure 1, the employment rate of those aged 50‐54
throughout the EU (75.2%) is well within the range observed for prime‐age workers (from 72.2% to 80.6%)
but the rate begins to fall dramatically from age 55 onwards. Accordingly, subsequent analysis focuses
mainly on the situation of older workers aged 55‐64 in comparison with those of prime‐age (25‐49) and
does not take into account those aged 50‐54. This has the advantage of accentuating differences but it
must be borne in mind that the shape of the employment‐rate vs. age curve varies between countries so
that in some cases merging the 50‐54 age‐group with the “older” workers might be justified.
4 In 2010, workers aged 55‐64 made up 12.7% of the active population (age 15+) in the EU, up from 9.3% in 2000. Source: Eurostat, Labour Force Survey, lfsa_agan.
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Figure 1 – Employment rates by age group and gender, EU 27, 2010 (%)
0
10
20
30
40
50
60
70
80
90
15-1
9
20-2
4
25-2
9
30-3
5
35-3
9
40-4
4
45-4
9
50-5
4
55-5
9
60-6
4
65-6
9
70-7
4
75+
Total
Men
Women
%
Source: Eurostat, Labour Force Survey: lfsa_ergan
In the last ten years there has been a clear trend for people to stay in work longer. The employment rate of
older workers (aged 55‐64) in the EU increased from 36.2% in 19975 to 46.3% in 2010. That is an impressive
10 percentage points in just over a decade but the current level still falls short of the 50% target to be
achieved by 2010, which was established by the Lisbon Strategy for 2010 and the Stockholm Council in
20016. It leaves the EU economy in a position of economic disadvantage in comparison to other major
developed economies such as the US and Japan where, although employment rates amongst prime‐age
workers are similar to those in the EU, a much higher proportion of older people is still in work. The gap
between the employment rates of those aged 25‐54 and those aged 55‐64 is just under 15 percentage
points in the US and Japan but more than double that (over 31 pp) in the EU (Figure 2). The extent of the
gap is particularly pronounced for women ‐ whilst employment rates for women aged 25‐54 in the EU are
actually slightly above those in the US and Japan, those for older workers are significantly lower. Overall,
the low employment rates among older workers in the EU means that the potential labour force is
significantly underexploited, which reduces the potential for growth, and that there are fewer people
contributing to the ever increasing burden of social welfare needed to support an ageing population.
5 First year for which Eurostat data are available for EU‐27.
6 Note that this target is no longer applicable and has been superseded by the over‐arching employment rate target of the Europe 2020 strategy, which aims for 75% of those aged 20‐64 to be in employment by 2020.
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Figure 2 – Employment rates by age group and sex, EU‐27, US and Japan, 2010
0
10
20
30
40
50
60
70
80
90
100
EU‐27 US Japan EU‐27 US Japan EU‐27 US Japan
25‐54 55‐64
Total Men Women
%
Source: Eurostat: lfsi_emp_a except for US & Japan 25‐54: OECD
Principal causes of low participation amongst older workers
There are various reasons why the employment rate of older workers is relatively low in most EU countries.
These factors and their intensity may differ between Member States, but the relevant literature generally
concurs on a few key issues.
Firstly, the lack of incentives both for employers to retain or hire older people and for older workers to
remain in the labour force. Existing research has classified the factors that influence the exit of older
workers from the labour market into “push” and “pull” factors (OECD, 2006). From the perspective of
employers, push factors include negative perceptions concerning the capacities of older workers and their
labour costs relative to productivity. From the perspective of individual older workers, they include poor
health and disability, work‐related issues (including unsatisfactory working conditions as well as an age‐
unfriendly work environment), the obsolescence of skills as a consequence of technological change and a
lack of opportunities to update skills (lifelong learning). Pull factors essentially consist of financial incentives
which encourage older workers to retire and factors associated with the attractiveness of retirement
(Taylor, 2002). Financial incentives embedded in pension systems and other welfare benefits play an
important role in work‐retirement decisions and it is essential that older people are not burdened by a
large implicit tax if they choose to continue to work. Therefore, tax/benefit reform could make it more
attractive (in terms of income) for older workers to continue to work rather than becoming inactive and
dependent on benefits. Analysis undertaken by the OECD (Duval, 2003), concludes that a 10 percentage
decrease in implicit taxes would increase the participation of older workers by 3‐4 percentage points.
Secondly, the low employment rate of older workers in Europe is also the result of social factors and, in
particular, the low level of activity amongst women compared to men. There are large cross country
differences within Europe, with Southern European countries persistently behind Nordic and Central
European countries in terms of female participation rates. However, female participation has steadily
increased over the past 30 years, and it has been one of the major drivers of the increased labour market
participation of older workers seen over the last decade or so. Female employment rates in Europe are
increasing as a result of changes in cultural attitudes regarding female participation, higher skill levels and
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more opportunity to reconcile work, family and care responsibilities. The increase can also be linked to the
increasing demand for labour in the services sector, where women tend to be concentrated. Furthermore,
female workers aged 45 and over hold a higher proportion of temporary contracts and part‐time
arrangements than their male colleagues. As many of these policies and individual decisions on labour
market participation are likely to persist, further increases in the participation of older women in the labour
market are likely in the future.
Thirdly, employment rates for older workers declined significantly during periods of economic and
structural change in Europe. Until the late 1970s it was rare for people in Western Europe to retire before
the normal retirement age. The economic recessions and consequent rises in unemployment during the
1970s and 1980s led to government measures and industry initiatives to reduce the size of the workforce
by promoting early retirement, particularly in the industrial sector and for men. In fact, in periods of
employment reduction, the common belief was that older workers are associated with higher labour costs
and lower productivity, thereby justifying the phenomenon of “older workers are first to go”. Moreover,
increasing numbers of older redundant workers moved from active benefits to inactive benefits. Many
discouraged workers gave up active job search, and thus unemployment benefits, and became
economically inactive moving onto permanent sickness or incapacity benefits. Similarly, in most Eastern
European countries, the low levels of activity amongst older people have been caused partly by large‐scale
downsizing associated with economic restructuring since the late 1980s‐early 1990s. Labour force
withdrawal was to a large extent encouraged by early retirement benefit schemes introduced by
governments in the hope of boosting unemployment for younger workers (De Serres, 2011).
It is not possible to examine these factors in more detail here, but it is evident that they are rooted in the
structural characteristics of the economy; changing them will take time and requires a radical social and
institutional adaptation in which PES can play an important role.
The demographic context – an ageing workforce
Beside the above mentioned factors, the EU faces tremendous challenges posed by long‐term demographic
changes and their impact on the labour market. Thanks to a combination of social and economic factors
and advances in medical care, the demographics of Europe are characterised by low birth rates and ever
increasing life expectancy and, as a result, the population is ageing. Current projections suggest that the EU
working age population will decrease by around 37 million (or 11%) by 2050 compared to 2010 levels and
that the old‐age dependency ratio will virtually double from its current level of just under 26% to over 50%
in 20507. Moreover, in the coming years older workers will account for a larger share of the working‐age
population than ever before – Eurostat projections suggest that the share will rise from 18% today to 22%
in 2030 and remain over 20% thereafter. But older workers will be more important in some countries than
others (Table 1). At some point over the next 50 years people aged 55‐64 will account for at least a quarter
of the working‐age population in 10 Member States (BG, DE, EE, EL, ES, LV, LT, PL, RO, SK) with a maximum
of 28% in Latvia, whilst in others the peak share will hardly go over 20% (IE, FR, LU, UK).
These trends imply a twofold challenge: a fall in the active population at a time when the number of older
people in need of adequate pensions, other inactivity benefits and long‐term care is rising. In the medium
to long term this is liable to have adverse consequences in terms of labour supply shortages and the
7 Source: Eurostat: http://epp.eurostat.ec.europa.eu/portal/page/portal/population/data/main_tables. The old‐age dependency ratio is the ratio of the number of elderly people at an age when they are generally economically inactive (i.e. aged 65 and over), compared to the number of people of working age (i.e. 15‐64 years old).
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sustainability of welfare systems (financing of pension and social benefit systems). As a result it is
increasingly important to encourage older workers to stay in work longer so that they boost the pool of
labour and remain as net contributors to the welfare system.
Table 1 – People aged 55‐64 as a share of the working‐age population (15‐64), 2010‐2060
% 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060
EU 27 18.1 19.3 20.7 21.8 22.0 21.7 21.7 22.0 21.7 20.9 20.4
Belgium 18.5 19.5 20.9 21.1 20.4 19.6 19.5 19.7 19.9 19.5 18.9 Bulgaria 20.0 20.5 21.0 21.5 22.9 25.0 25.7 25.8 24.2 20.3 19.3 Czech Republic 20.0 19.6 18.7 18.7 21.0 24.5 24.5 23.3 23.0 20.5 18.8 Denmark 19.9 19.1 20.1 21.3 21.3 20.2 18.7 18.4 19.8 20.5 20.3
Germany 18.1 20.9 24.2 26.5 24.5 21.5 21.8 23.3 23.5 22.9 22.5 Estonia 17.5 19.3 20.2 19.7 20.0 20.9 22.6 25.2 24.1 19.3 17.7
Ireland 15.0 16.5 17.7 18.0 18.4 19.4 20.6 18.5 15.3 15.8 17.5 Greece 18.1 19.2 20.5 22.3 24.1 25.3 25.5 23.6 21.6 21.0 20.7
Spain 16.0 17.5 19.7 21.5 23.3 25.0 24.7 22.4 20.8 20.4 21.0 France 19.3 19.7 20.2 20.5 20.6 19.7 19.2 19.9 19.7 19.4 19.5
Italy 18.6 19.2 21.3 23.7 24.8 24.3 22.8 21.8 21.8 21.9 22.0 Cyprus 16.1 17.4 18.2 17.5 17.2 18.2 20.5 21.9 22.2 21.5 19.7 Latvia 16.5 18.9 20.9 20.8 21.1 22.1 24.3 28.0 28.0 22.6 19.9 Lithuania 15.5 18.0 21.0 21.8 21.2 20.3 21.1 24.2 25.5 22.8 19.4
Luxembourg 15.9 17.1 18.9 20.3 20.3 20.0 20.3 20.4 20.4 20.4 20.1 Hungary 19.3 20.2 18.4 18.2 20.6 24.0 24.6 23.6 24.0 23.1 22.0
Malta 20.3 20.3 20.3 18.4 17.9 20.1 21.9 23.2 24.1 23.3 21.1 Netherlands 19.4 19.8 21.4 22.7 22.2 20.1 18.9 19.5 20.3 20.5 20.6
Austria 16.7 18.5 21.7 23.7 22.7 20.4 20.2 20.9 21.7 21.9 21.2 Poland 18.1 20.6 19.9 18.1 18.8 21.8 25.3 26.9 26.0 23.4 20.7
Portugal 17.8 18.9 20.3 21.3 22.6 24.3 24.4 22.9 21.9 22.1 23.0 Romania 16.9 18.8 17.6 19.2 22.3 24.1 25.3 27.1 26.1 22.9 22.4
Slovenia 18.4 20.8 21.5 22.0 22.1 23.3 24.7 24.7 23.1 20.8 19.6 Slovakia 16.8 18.9 19.1 18.6 19.9 23.3 25.5 26.1 25.7 23.4 21.1
Finland 22.1 21.5 21.3 21.0 19.4 19.1 20.3 20.5 20.8 20.4 19.4 Sweden 19.7 18.6 19.1 20.1 20.2 19.2 18.7 19.8 21.3 19.8 18.0
United Kingdom 17.8 17.7 19.4 20.5 19.7 17.8 17.8 19.1 19.6 19.0 17.9
Source: Eurostat population projections: proj_10c2150p
Employment rate differences between countries
The overall EU employment rate for people aged 55‐64 in 2010 (46.3%) masks considerable differences
between countries (Figure 3). On the one hand, Sweden stands out with a rate of 70.5%, some 12
percentage points ahead of any other country. There is then a group of five countries (DE, DK, UK, CY and
FI) with rates between 56 and 58% which, although high in the European context, are still some way behind
those reported in the US and Japan. Estonia, the Netherlands and Ireland – just – complete a group of nine
countries that have met the Stockholm target of 50% in 20108, though it should be noted that this target is
no longer applicable and has been superseded by the overall Europe 2020 target of 75% for those aged 20‐
64. On the other hand, employment rates of older workers were below 40% in the three French speaking
continental Member States (FR, LU, BE) and in Italy, and 35% or less in Slovenia, Hungary, Poland and
Malta. In some cases, low rates are at least in part linked to lower retirement ages, something that many
Member States are now taking steps to address.
8 In 2009, Lithuania and Latvia also met the 50% target for the employment rate of older workers but the ongoing impact of the recession saw rates in these countries fall to 48.6% and 48.2% respectively in 2010.
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European Job Mobility Laboratory, November 2011 14
Figure 3 ‐ Employment rates of people aged 55‐64, EU‐27, 2010 (%)
30.2
46.3
70.5
0 10 20 30 40 50 60 70 80
MTPLHUSIITBELUFRSKROELATBGES
EU 27CZLVLTPTIENLEEFICYUKDKDESE
Source: Eurostat, Labour Force Survey: lfsa_ergan
In general, low employment rates for older workers are associated with low rates for prime‐age workers
though there are exceptions, which relate to unusually high (or low) differences between the employment
rates of the two groups. For example, Slovenia has one of the highest employment rates for prime‐age
workers (85%) but one of the lowest for older workers (35%) – a gap of 50 percentage points, the highest in
the EU (Figure 4). By contrast, Ireland has the second lowest rate for prime‐age workers (70.6%) but an
above average employment rate for older workers (50%) so that the employment rate gap is just 20.6
percentage points, the second lowest in the EU. This particular case is a direct result of the recession as the
employment rate of prime‐age workers in Ireland fell by nearly 9 percentage points between 2007 and
2010 whilst the rate for older workers fell by less than 4 pp over the same period.
Across the EU, the employment rate gap between older and prime‐age workers is just under 32 percentage
points. Reducing this gap by raising the level of employment amongst older workers could contribute
significantly to the Europe 2020 target of having 75% of people aged 20‐64 in employment by 2020. Over
the past decade the gap has been reduced significantly in countries such as Germany and Slovakia where it
has fallen over 18 percentage points (Table 2) but it has actually increased in Poland (1.1 pp), Malta (6.5 pp)
and Romania (6.8 pp).
The variation between countries reflects social and economic differences including, to some extent,
different retirement ages, but also the extent to which welfare and pension systems have been reformed
over the past decade as well as efforts to reduce access to early retirement schemes, strengthen incentives
to work longer and improve the employability of older workers (COM(2009) 58). It demonstrates clearly
which countries need to take action to tackle the issue of low levels of activity amongst older workers and
to what extent.
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European Job Mobility Laboratory, November 2011 15
Figure 4 ‐ Employment rate gap between prime‐age (25‐49) and older workers (55‐64) in the EU, 2010
14.4
31.8
50.0
0 10 20 30 40 50 60
SEIEEEUKDEFILTLVDKESCYPT
EU 27NLELBGITROCZSKHUMTFRATBELUPLSI
Source: Eurostat, Labour Force Survey: lfsa_ergan
Table 2 ‐ Employment rate gap between prime‐age (25‐49) and older workers (55‐64), 2000‐2010
Gap (percentage points) 2000 2005 2010 Change 2000‐2010 EU27 40.3 35.8 31.8 ‐8.5 Belgium 56.0 48.3 43.9 ‐12.1Bulgaria 48.4 39.0 32.7 ‐15.7Czech Republic 45.7 37.4 35.3 ‐10.4 Denmark 30.5 25.3 25.8 ‐4.7 Germany 42.8 33.3 24.0 ‐18.8 Estonia 34.1 23.9 21.2 ‐12.9 Ireland 32.0 27.5 20.6 ‐11.4Greece 32.8 33.9 32.3 ‐0.5Spain 33.1 32.6 26.6 ‐6.5 France 49.6 42.7 42.3 ‐7.3 Italy 42.1 41.8 34.7 ‐7.4 Cyprus 29.6 32.3 26.8 ‐2.8 Latvia 38.6 29.6 25.8 ‐12.8Lithuania 34.9 32.7 25.6 ‐9.3Luxembourg 52.9 50.4 44.2 ‐8.7Hungary 52.1 41.9 38.7 ‐13.4 Malta 34.5 33.9 41.0 6.5 Netherlands 45.7 37.9 31.8 ‐13.9 Austria 53.9 51.9 42.6 ‐11.3Poland 43.8 45.2 44.9 1.1Portugal 32.1 31.4 30.8 ‐1.3 Romania 27.9 35.5 34.7 6.8 Slovenia 63.3 55.6 50.0 ‐13.3 Slovakia 53.6 45.2 35.5 ‐18.1 Finland 40.2 29.4 25.4 ‐14.8Sweden 17.9 14.5 14.4 ‐3.5UK 30.6 24.8 22.9 ‐7.7
Source: Eurostat, Labour Force Survey: lfsa_ergan
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European Job Mobility Laboratory, November 2011 16
The gender gap
The employment rates of women are generally below those of men for all age‐groups (Figure 1) and the
extent of the gender gap strongly influences the overall employment rate in each group. In general the gap
is low for younger workers, increases through the main child‐bearing years as women take career breaks,
reduces slightly through to the 45‐49 age‐group as children grow up and need less full‐time care and then
increases again. In 2010, the gender gap was 12.5 percentage points for prime‐age workers (25‐49) but 16
pp for older workers (55‐64).
The absolute size of the gender gap is likely to be at least partly related to the overall level of the
employment rate, and one way to eliminate this factor is to look at the ratio of the rates for each gender.
Expressing the employment rate for women as a proportion of that for men generates a form of
segregation index showing the scale of the difference between the sexes. The higher the value of the index
the closer the female rate is to the male rate, the lower the value the greater the gender gap. For the EU as
a whole the segregation index is 71% for older workers compared to 85% for prime‐age workers (Figure 5) –
in other words the gender gap is greater for older workers. This pattern is common to most Member States
with the index in 2010 lower for older workers in all countries except Estonia, France, Latvia and Finland.
The segregation of older workers is particularly pronounced (i.e. low values of the index) in Mediterranean
countries and in some eastern European countries (Poland, Slovakia, Slovenia, Czech Republic).
Figure 5 ‐ Employment rate segregation index (Female/male employment rate) by age group, 2010
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
EU27 BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK
25‐49 55‐64
Source: Eurostat, Labour Force Survey: lfsa_ergan
Over the past decade the gender gap has reduced significantly (Figure 6) but it is noticeable that there is a
distinct cut‐off point at age 60‐64 and above, where there has been virtually no change in the gap. It is
possible that this is partly a cohort effect, as women currently aged 60 or over belong to a generation when
(relatively) fewer women worked, and that the positive reduction in the gender gap will feed through to
that age‐group as the younger women who are working now move through the age brackets, though this
will of course depend on there being the right opportunities and environment for them to do so.
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Figure 6 – The gender gap in employment rates by age group, EU 27, 2000 and 2010
0
5
10
15
20
25
15 ‐ 19 20 ‐ 24 25 ‐ 29 30 ‐ 34 35 ‐ 39 40 ‐ 44 45 ‐ 49 50 ‐ 54 55 ‐ 59 60 ‐ 64 65 ‐ 69 70 ‐ 74
2000 2010
Employment rate gap (percentage points)
Source: Eurostat, Labour Force Survey: lfsa_ergan
The unexploited potential of older workers
The evidence of current employment rates amongst older workers show that Europe is lagging behind
other advanced economies (US and Japan) in exploiting their potential labour resources particularly when it
comes to elderly workers. Bearing in mind the Europe 2020 target to get 75% of those aged 20‐64 in
employment by 2020, just how much could boosting the employment of older workers contribute to that
target? The current employment rate gap between prime‐age (25‐49) and older workers (55‐64) is over 30
percentage points. A simple simulation shows that reducing that gap by 5 points would result in a 1 point
rise in the overall rate for those aged 20‐64. Therefore, raising the employment rate of older workers by 20
percentage points, which would bring it up to a similar level to that in Japan, would add 4 points to the
overall rate and bring it from the current level of 68.6% to 72.6% and much closer to the 2020 target.
Obviously increasing the share or older workers in employment by 20 percentage points is not a realistic
short‐term target but it serves to demonstrate the potential that exists.
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Figure 7 ‐ Potential impact on the overall employment rate (20‐64) of an increased employment rate for
older workers (55‐64), EU 27
68.6%
46.3%51.3%
69.6%66.3%
72.6%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Older workers (55‐64) Overall employment rate (20‐64)
Current (2010) rate Plus 5% for 55‐64 Plus 20% for 55‐64
Source: Own elaboration of Eurostat data
2.2 Recent trends and the impact of the crisis
In recent years one of the most prominent developments in the EU labour market has been the sharp rise
in the numbers of older workers in employment. Between 2000‐2008, a period that includes several years
of strong growth, the number of people in work in the EU increased by nearly 19.5 million (Table 3) and 7.6
million of these – nearly 40% of the total ‐ were people aged between 55 and 64, who accounted for less
than 10% of total employment at the start of the period. Indeed, the number of people of this age group in
employment increased by nearly 40% over the period compared to a rise of just 6% for prime‐age workers
(25‐49) and a marginal decline for younger workers (15‐24). It is interesting to note that although women
accounted for 70% of the increase amongst prime‐age workers, there was a 50:50 split amongst older
workers. However, as there were fewer women than men employed in both age groups at the start of the
period, the percentage changes in both cases show that the rate of increase was higher for women than
men – nearly 10% compared to 3% for prime‐age workers and 52% compared to 32% for older workers.
Table 3 ‐ Changes in employment by age and gender, EU27, 2000‐2008 and 2008‐2010
Absolute numbers (1000s)
Total Men Women
2000‐2008 2008‐2010 2000‐2008 2008‐2010 2000‐2008 2008‐2010
15‐24 ‐47.7 ‐2,574.6 28.6 ‐1,541.9 ‐76.2 ‐1,032.725‐49 8,276.3 ‐4,609.6 2,504.6 ‐3,083.9 5,771.7 ‐1,525.755‐64 7,615.4 1,393.4 3,805.9 433.3 3,809.4 960.2Total 19,445.2 ‐5,314.7 7,664.7 ‐4,141.2 11,780.5 ‐1,173.6
Percentage change
Total Men Women
2000‐2008 2008‐2010 2000‐2008 2008‐2010 2000‐2008 2008‐2010
15‐24 ‐0.2% ‐11.4% 0.2% ‐12.5% ‐0.7% ‐10.1%25‐49 6.1% ‐3.2% 3.3% ‐3.9% 9.8% ‐2.4%55‐64 39.6% 5.2% 32.1% 2.8% 51.6% 8.6%Total 9.8% ‐2.4% 6.8% ‐3.5% 13.7% ‐1.2%
Source: Eurostat, Labour Force Survey: lfsa_egan
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European Job Mobility Laboratory, November 2011 19
Then, over the following two years as the impact of the financial crisis hit labour markets across Europe, 5.3
million jobs were lost. However, these losses were concentrated amongst prime‐age and younger workers
and employment continued to rise amongst the older age‐groups with the number of people aged 55‐64 in
work in 2010 up 1.4 million or 5.2% from the 2008 level.
As striking as these figures may be, changes over time in the absolute numbers of people employed can ‐
particularly over longer periods – sometimes be a little misleading as they do not take into account
underlying demographic changes which dictate the size of the potential labour pool in each age‐group.
Employment rates relate the numbers in work to the population and therefore avoid this problem and, in
fact, the figures just serve to emphasise the message above. From 2000 to 2008 employment rates
increased generally but clearly increased more with age and more so for women than men (Figure 8). Over
the crisis period employment rates fell generally but more so for the younger age groups and the only
increases were amongst older workers (Figure 9). Again, women did better, or were less badly affected,
than men. This is partly a continuation of the longer term trend of increasing participation of women, but
also a reflection of the sectoral distribution of job‐losses during the crisis which particularly affected male
dominated sectors such as construction and manufacturing. Austerity measures that are now imposing cut‐
backs in public services including areas such as health, social services and education, which employ large
numbers of women might impact on this trend in the future.
Figure 8 ‐ Change in employment rates by age‐group, EU‐27, 2000‐2008
‐6
‐4
‐2
0
2
4
6
8
10
12
15‐19 20‐24 25‐29 30‐35 35‐39 40‐44 45‐49 50‐54 55‐59 60‐64
Total Men Women
Percentage point change
Source: Eurostat, Labour Force Survey: lfsa_ergan
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European Job Mobility Laboratory, November 2011 20
Figure 9 ‐ Change in employment rates by age‐group, EU‐27, 2008‐2010
‐6
‐4
‐2
0
2
4
6
8
10
12
15‐19 20‐24 25‐29 30‐35 35‐39 40‐44 45‐49 50‐54 55‐59 60‐64
Total Men Women
Percentage point change
Source: Eurostat, Labour Force Survey: lfsa_ergan
The trends seen at EU level are more or less mirrored at national level, though there are some exceptions
(Table 4). In the 2000‐2008 period employment rates rose everywhere except Romania and Portugal and
older workers were the best performing group in 21 Member States (all except Denmark, Greece, Cyprus,
Malta, Poland and Romania). In the post‐crisis period (2008‐2010) employment rates fell overall in most
countries, and in some cases significantly so (e.g. Estonia, Ireland and Latvia), but changes for older workers
were positive in the majority of the countries (16 vs. 11). Moreover, irrespective of whether changes were
up or down, older workers did better than prime‐age or younger workers in all but three Member States
(Latvia, Malta and Romania).
The evidence of employment numbers and rates clearly indicate that the economic downturn impacted less
on older workers in the EU than on prime‐age workers or rather, on younger workers. This concurs with
other international evidence (e.g. OECD, 2011) and findings that older workers were less likely than
younger ones to lose their jobs as a result of the recent crisis (Johnson and Mommaerts, 2011). It is,
however, in contrast to the previous recession, when older workers were often the first to lose their jobs
and found it hardest to find new employment (OECD, 2011). In fact, in many European countries, previous
recessions saw sharp declines in the numbers of older men in employment. Traditional occupations and
industries suffered most as policies encouraging early retirement were widely used (Baron, 2009).
However, the situation today is rather different. Early retirement schemes are largely inconsistent with key
political objectives to increase employment amongst older workers and generally, where they still exist,
governments are taking steps to reduce access to such schemes. There are, of course, some differences
between countries but, overall, older workers in Europe appear to have fared relatively well through the
crisis period.
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European Job Mobility Laboratory, November 2011 21
Table 4 ‐ Changes in employment rates by age‐group, 2000‐2008 and 2008‐2010
2000‐2008 2008‐2010 15‐24 25‐49 55‐64 Best performing group 15‐24 25‐49 55‐64 Best performing group
EU‐27 0.5 3.3 8.8 Older ‐3.4 ‐2.3 0.7 Older BE ‐2.9 1.3 9.5 Older ‐2.2 ‐1.1 2.8 Older BG 5.8 11.5 23.9 Older ‐4.1 ‐5.8 ‐2.5 OlderCZ ‐8.3 1.6 11.5 Older ‐2.9 ‐1.6 ‐1.1 OlderDK ‐0.2 3 2.7 Prime‐age ‐8.8 ‐4.7 0.3 Older DE 0.8 2.1 16.4 Older ‐0.7 ‐0.6 3.9 Older EE 9.3 7 19.1 Older ‐10.7 ‐9.4 ‐8.6 Older IE ‐2.2 1 8.6 Older ‐15.4 ‐7.5 ‐3.7 Older EL ‐3.9 5.4 3.4 Prime‐age ‐3.1 ‐3 ‐0.5 OlderES 3.8 6.5 8.8 Older ‐11.1 ‐6.2 ‐2 OlderFR 3.7 4.6 8.8 Older ‐1.1 ‐1.6 1.5 Older IT ‐1.7 4.5 7.1 Older ‐3.9 ‐2.6 2.2 Older CY 1.3 5.5 5.3 Prime‐age ‐4.2 ‐1 2 Older LV 6.9 9 24 Older ‐10.8 ‐9 ‐11.2 Prime‐age LT 0 6 11.9 Older ‐7.5 ‐7.9 ‐4.5 OlderLU ‐8 0.8 6.9 Older ‐2.6 2.9 5.5 OlderHU ‐13.1 1.4 9.5 Older ‐1.7 ‐2.3 3 Older MT ‐6.5 6.5 0.6 Prime‐age ‐1.1 1.6 1 Prime‐age NL 0.9 4.1 15.1 Older ‐6.3 ‐2.2 0.7 Older AT 3.4 2.2 11.8 Older ‐2.3 ‐0.3 1.4 Older PL 3.2 7.1 2.6 Prime‐age ‐1 ‐1 2.4 OlderPT ‐6.4 ‐0.6 ‐0.5 Older ‐6.2 ‐2.8 ‐1.6 OlderRO ‐9.2 ‐4 ‐8.9 Prime‐age ‐0.5 ‐0.1 ‐2 Prime‐age SI 7.2 3 10.5 Older ‐4.3 ‐3.6 2.2 Older SK ‐2.1 5.4 17.7 Older ‐5.6 ‐4.5 1.3 Older FI ‐0.7 3.1 15.3 Older ‐5.9 ‐2.9 ‐0.3 Older SE 5.3 4.5 5.8 Older ‐3.5 ‐1.8 0.4 OlderUK ‐3.4 0.6 7.6 Older ‐4.8 ‐1.6 ‐0.9 Older
Source: Eurostat, Labour Force Survey: lfsa_ergan
2.3 The working situation of older workers
This section aims to investigate briefly some of the possible reasons why older workers have been less
affected by the recent economic crisis, and whether the gross employment rate figures might conceal other
trends for older workers in relation to working hours or atypical forms of employment.
Working hours
Many older workers, particularly those with a long working life, would welcome the opportunity to
gradually reduce their hours rather than retire completely. This strategy can help to keep people in work
longer and there are policy measures in a number of countries to support this transition (see Abraham and
Houseman, 2004). Indeed, Figure 10 shows that there is a clear tendency for people to work fewer hours as
they near retirement. In 2010, only 14% of the people aged 25‐49 worked less than 30 hours per week and
the proportion is similar for the 50‐54 age‐group, but there is a clear increase to nearly 17% for people
aged 55‐59 and to more than 25% for those in the 60‐64 age group.
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European Job Mobility Laboratory, November 2011 22
Figure 10 ‐ Share of people in employment working less than 30 hours/week by age group, EU 27, 2010
25.3%
13.2% 13.6% 13.5% 13.4% 13.3% 13.7%13.9%
14.1% 14.1% 13.8% 13.8% 13.9% 14.2% 14.5%
17.7% 17.5% 17.4%17.0% 16.9% 16.9%
16.8%
24.9% 25.1% 24.8% 25.4%25.0% 24.9%
10%
15%
20%
25%
30%
2004 2005 2006 2007 2008 2009 2010
25‐49 50‐54 55‐59 60‐64
Source: Own elaboration of EU LFS data
What is also clear, however, is that there is no evidence that these shares are changing significantly and
certainly nothing in this particular dataset to suggest that working less has been a factor in helping older
workers keep their jobs through the crisis period. Eurostat data indicate that the total number of hours
worked per person fell between 2008 and 2010 but it is quite likely that this largely reflects cuts in overtime
hours for full‐time workers rather than a significant shift from full‐time to part‐time hours. Amongst prime‐
age workers and those aged 50‐54 there is a hint that the proportion working less than 30 hours increased
through the crisis period but the change is so small – just half a percentage point – that it is difficult to
attribute any major significance to this and the change in the older workers group is even smaller.
Self‐employment
Older workers are more likely to be self‐employed than prime‐age and younger workers. In 2010 more than
one in five (21.6%) older workers in employment were self‐employed (with or without employees)
compared to one in seven prime‐age workers (Table 5). In recessions, redundancy – either a perceived
threat of it or the reality of it – may motivate people to start their own businesses and the capacity to make
this type of transition may have made older workers more resilient to the impact of the crisis. However, the
data show that there has been little change in the incidence of self‐employment amongst either prime‐age
or older workers. In fact, over a longer period, since 2004, the proportion of older workers who are self‐
employed has fallen slightly from 24.4% to 21.6% but most of this decline occurred before the crisis.
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European Job Mobility Laboratory, November 2011 23
Table 5 – Distribution of people in employment by professional status and age group, EU 27 (%)
25‐49 2004 2005 2006 2007 2008 2009 2010
Employee 84.1 84.3 84.4 84.5 84.7 84.8 84.7
Family worker 1.6 1.5 1.4 1.3 1.2 1.2 1.2
Self‐employed with employees 4.5 4.4 4.4 4.5 4.4 4.4 4.2
Self‐employed without employees 9.8 9.8 9.8 9.7 9.7 9.6 9.9
55‐64 2004 2005 2006 2007 2008 2009 2010
Employee 72.4 73.5 74.6 75.3 76.1 76.2 76.4
Family worker 3.2 2.9 2.5 2.5 2.2 2.1 1.9
Self‐employed with employees 7.6 7.1 6.8 6.9 6.7 6.9 6.5
Self‐employed without employees 16.8 16.5 16.0 15.2 15.0 14.9 15.1
Source: Own elaboration of EU LFS data
Temporary work
Hiring and firing regulations and stability of job tenure are further factors that may contribute to
differences between age‐groups in terms of losing or keeping a job during a recession. As a result of longer
service, many older workers enjoy stronger employment protection than younger workers. This can be
particularly significant in countries where the level of protection offered with open‐ended and fixed‐term
contracts varies greatly and when younger workers are most likely to be employed on temporary contracts.
In times of recession, when employers are under pressure to cut jobs usually employees hired under
temporary (fixed‐term) contracts ‐ often young people and women – are the first to go, simply because
such contracts are easier and cheaper to terminate.
Older workers are less likely than average to be employed on a temporary contract – around 7% of
employees aged 55‐64 work on the basis of a fixed‐term contract compared to 12% of prime‐age workers
(Table 6; figures by country can also be found in Table A.1 in annex). In both cases, women are more likely
than men to be engaged on a temporary contract. Interestingly, however, the proportion of older
employees on temporary contracts has hardly changed over recent years, including the crisis period, which
suggests that the job‐losses that occurred as a result of the recession impacted equally on people with
fixed‐term and open‐ended contracts. This was not the case for prime‐age workers where there is evidence
in a decline in the share of temporary contracts over the crisis period as these people were among the first
to be dismissed. It is possible, therefore, that the relatively low incidence of temporary work amongst older
workers therefore helped to isolate them from some of the highest risks of job‐loss.
Table 6 ‐ Share of employees working on a temporary contract, EU‐27, 2004‐2010 (%)
2004 2005 2006 2007 2008 2009 2010
Males 25‐49 10.1 11.1 11.6 11.5 11.1 10.6 11.2
Females 25‐49 12.0 12.6 13.2 13.4 13.2 12.8 13.0
Males 55‐64 5.9 6.4 6.6 6.6 6.5 6.4 6.7
Females 55‐64 6.8 6.8 7.2 7.3 7.3 7.3 7.1
Source: Eurostat, Labour Force Survey: lfsa_etgaed & lfsa_egaps
2.4 Unemployment among older workers and the effect of the crisis
In terms of employment, there is a long‐term trend for people to stay in work longer and the evidence
reviewed above shows that economic downturn has impacted less on older workers than on other age
groups. Nevertheless, once older workers lose their job they encounter major difficulties in finding a new
one. Older workers are more likely to have longer spells of unemployment with the result that many
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 24
become discouraged from seeking work and slip into inactivity, which is often a path of no return with few
chances of re‐entering the world of work.
Overall, older workers are less likely to be unemployed than prime‐age workers. In 2010, the EU
unemployment rate for people aged 55‐64 was 6.9% compared to 8.9% for those aged 25‐49 (and 20.9%
for those aged 15‐24). Rates for older workers are lower than those for prime‐age workers in 21 of the 25
countries for which the breakdown is available and just a little higher in five countries – Bulgaria, the Czech
Republic, Germany, Estonia and the Netherlands (Figure 11).
Increases in unemployment as a result of the recession also affected prime‐age workers slightly more than
older workers. The unemployment rate of older workers increased by 1.8 percentage points between 2008
and 2010 compared to 2.6 pp for prime‐age workers (and 5.4 pp for younger workers). Again, this pattern is
reflected in the vast majority of Member States with larger increases for older workers only in the Czech
Republic and France and in both cases the difference was marginal (0.2 pp).
Figure 11 ‐ Unemployment rates by age‐group, 2010
0
2
4
6
8
10
12
14
16
18
20
EU27 BE
BG CZ
DK
DE EE IE EL ES FR IT CY LV LT LU HU
MT
NL
AT
PL
PT
RO SI SK FI SE UK
25‐49 55‐64
% labour force
Source: Eurostat, Labour Force Survey: lfsa_urgan. Data not available for older workers in LU & MT.
Figure 12 ‐ Changes in the unemployment rate by age‐group, 2008‐2010
‐2
0
2
4
6
8
10
12
14
EU27 BE
BG CZ
DK
DE EE IE EL ES FR IT CY LV LT LU HU
MT
NL
AT
PL
PT
RO SI SK FI SE UK
25‐49 55‐64
Percentage points
Source: Eurostat, Labour Force Survey: lfsa_urgan. Data not available for older workers in LU & MT.
So, in general, older workers are less likely to be unemployed than other age‐groups and were not
particularly adversely affected by the crisis. The problem is that once displaced, older workers tend to stay
unemployed longer than their younger counterparts. In 2010, over half (54‐56%) of the unemployed aged
55‐64 had been out of work for 12 months or more compared to 41% of those aged 25‐49 (Figure 13) and
there is little difference between men and women. Amongst the older unemployed (55‐64) more than 30%
had been seeking work for at least 2 years and 17‐18% for more than 4 years. These figures compare to less
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 25
than 20% and 8% respectively for prime‐age unemployed. The figures clearly show that the duration of
unemployment spells increases with age. In other words for people who become unemployed, the older
you are the longer it is likely to take to find a new job.
This pattern is repeated in all EU Member States except the Czech Republic and Estonia where long‐term
unemployment (12+ months) is slightly more prevalent among prime‐age workers (Figure 14). In terms of
the relative incidence of long‐term unemployment, the difference between old and prime‐age workers is
particularly pronounced in some countries. For example, in Belgium 80% of older unemployed have been
out of work for a year compared to 50% of prime‐age unemployed and in Austria, although the levels of
long‐term unemployment are lower, the difference between the share of older and prime‐age unemployed
who are LTU is still over 30 percentage points (56% vs. 24%). Although Belgium has the highest level of
long‐term unemployment amongst older workers, levels are also considerably above average in Portugal
and Slovakia, though in the latter case long‐term unemployment is high generally and not particularly
concentrated amongst older workers.
Figure 13 ‐ Distribution of the unemployed by duration of job‐search and age‐group, EU‐27, 2010
39.1%
31.4%
27.8%
26.9%
20.1%
18.6%
18.4%
17.6%
21.7%
22.3%
22.7%
22.9%
11.0%
13.4%
14.6%
14.4%
8.1%
14.3%
16.5%
18.3%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
25‐49
50‐54
55‐59
60‐64
< 6 month 6‐11 months 12‐17 months 24‐47 months 4 years or longer
Source: Own elaboration of EU LFS data
Figure 14 ‐ Long‐term unemployed as a share of total unemployed by age‐group, 2010
0
10
20
30
40
50
60
70
80
90
EU‐27
BE
BG CZ
DK
DE EE IE EL ES FR IT CY
LV LT LU HU
MT
NL
AT PL
PT
RO SI SK FI SE UK
25‐49 55‐64
%
Source: Eurostat, Labour Force Survey: lfsa_upgal. Data not available for older workers in LU & MT.
Typically, in a recession the proportion of long‐term unemployed falls as there is a large influx of short‐term
unemployed. The last recession was no exception with the proportion of unemployed who had been out of
work for a year of more falling across the EU in 2008 and 2009 but then starting to rise again as those who
lost their jobs earlier in the recession failed to find work again and the duration of unemployment spells
lengthened (Figure 15). The trend for older and prime‐age unemployed over the period 2000‐2010 is more
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 26
or less the same. The gap between the two (i.e. the difference in the proportions of each group who where
long‐term unemployed) widened somewhat towards the end of the growth period (from around 13
percentage points to 19), indicating that even in the most buoyant of labour markets older workers still
have the greatest difficulties to find work. But since the onset of the recession the gap has narrowed again
and returned to the previous level.
Figure 15 ‐ Long‐term unemployed as a share of total unemployed by age‐group, EU‐27, 2000‐2010
0
10
20
30
40
50
60
70
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
25‐49
55‐64
%
Source: Eurostat, Labour Force Survey: lfsa_upgal
Across the EU, the long‐term unemployment rate (i.e. the number of long‐term unemployed people as a
share of the labour force) for older workers (3.7%) is very similar to that for prime‐age workers (3.6%) and
the same is true in most Member States (Figure 16). Moreover, recent changes in the level of long‐term
unemployment as the impact of the crisis filters through do not appear to have particularly affected older
workers – changes are similar for prime‐age workers and, if anything, slightly lower – particularly in the
most affected countries (Figure 17). The data clearly shows how the rate of long‐term unemployment has
risen dramatically in the countries that were hit earliest and hardest by the recession – Estonia, Ireland,
Spain, Latvia and Lithuania. It is likely that further delayed increases will be seen in more countries as data
on the longer term impact of widespread job‐losses become available.
Figure 16 ‐ Long‐term unemployment rates in the EU by age‐group, 2010
0.01.0
2.03.0
4.05.0
6.07.0
8.09.0
EU27
BE
BG CZ
DK
DE EE IE EL ES FR IT CY
LV LT LU HU
MT
NL
AT PL
PT
RO SI SK FI SE UK
25‐49 55‐64
% labour force
Source: Own elaboration of EU LFS data. Data not available for older workers in LU & MT.
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 27
Figure 17 ‐ Changes in long‐term unemployment rates in the EU by age‐group, 2008‐2010
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
EU
27
BE
BG
CZ
DK
DE
EE IE EL
ES
FR IT CY
LV
LT
LU
HU
MT
NL
AT
PL
PT
RO SI
SK FI
SE
UK
25-49 55-64
Percentage points
Source: Own elaboration of EU LFS data. Data not available for older workers in LU & MT.
2.5 Labour market transitions: the drift into inactivity
Mobilising the potential labour supply of inactive people is the key to achieving the employment rate
targets set by the EU and has a major role in attenuating the negative impact of population ageing on the
labour market (Employment in Europe 2007). Although encouraging people to stay in work longer will
reduce inactivity amongst the older age‐groups, this is only part of the story. It is also necessary to target
those who have already become inactive and encourage them to return to work. The question is how to do
this effectively. Public employment services tend to work mainly with people that are unemployed or
otherwise actively seeking work but the analysis below shows that older workers who become unemployed
are likely to drift into inactivity and stop seeking new employment. Once outside the labour market, little
assistance is available so more needs to be done to tackle the specific needs of older workers, help them
adapt to new ways of working and eliminate the barriers that discourage them from continuing to seek
work.
The proportion of people who move from being active (employed or unemployed) in one year to inactive in
the next is higher for the 55‐64 age‐group than the 25‐49 age‐group (Figure 18). Around one in thirteen
(7.6%) older workers who were employed in 2009 were inactive in 2010 compared to more like one in fifty
prime‐age workers. But what is really striking is that for people who were unemployed in 2009, nearly half
of those aged 55‐64 were inactive in 2010 compared to just over one in five of those aged 25‐49. For both
age‐groups, though more so for the older workers, the proportion of unemployed drifting into inactivity
increased steadily between 2004 and 2008/9 but fell back slightly in 2010.
Figure 18 ‐ Drift into inactivity by age‐group, EU 27, 2004‐2010 (%)
1.8% 1.7% 1.8% 1.8% 1.8% 2.1% 2.2%
7.6%8.0% 7.5% 7.6% 7.4% 7.4% 7.9%
0%
10%
20%
30%
40%
50%
2004 2005 2006 2007 2008 2009 2010
Employed 25‐49 Employed 55‐64
Proportion of people employed in the previous year and now inactive
22.8%
46.0%
19.7% 21.6% 21.9% 23.1%24.8% 25.0%
40.8%41.9%
47.6% 48.1% 49.5% 49.6%
0%
10%
20%
30%
40%
50%
2004 2005 2006 2007 2008 2009 2010
Unemployed 25‐49 Unemployed 55‐64
Proportion of people unemployed in the previous year and now inactive
Source: Own elaboration of EU LFS data
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 28
There are important differences between men and women, in all cases the latter are more likely than the
former to be inactive after having been active in the previous year (Figure 19). There are a number of
factors that may be behind this. Firstly, women are more likely than men of the same age to be working in
part‐time, temporary and low‐wage jobs so that there are fewer incentives to remain in the labour market.
Secondly, women more often than men take on caring and family responsibilities and this can be a source
of saving for the whole family, especially compared to low wage employment. Thirdly, in some countries
the official retirement age still favours women, though the differences are gradually being eroded.
The proportion of people drifting into inactivity also differs according to their level of education (Annex ‐
Figure A.1). As might be expected, people aged 55‐64 with low levels of education are most likely to drift
into inactivity – generally they are employed in the hardest and lowest paid jobs and hence have less
incentive to stay. Prime‐age workers with high levels of education are least likely to become inactive.
Figure 19 ‐ Drift into inactivity by age‐group and sex, EU 27, 2004‐2010 (%)
1.3%
6.9%
8.5%
1.0% 1.4%
2.8% 3.2%
7.2%6.4%
7.1%
9.3% 9.1%
0%
2%
4%
6%
8%
10%
2004 2005 2006 2007 2008 2009 2010
Men 25‐49 Women 25‐49 Men 55‐64 Women 55‐64
Proportion of people employed in the previous year and now inactive
27.3%
42.7%
50.5%
15.8%21.0% 18.8%
23.6%29.0%
38.5%
46.3%
44.6%
54.5%
0%
10%
20%
30%
40%
50%
60%
2004 2005 2006 2007 2008 2009 2010
Men 25‐49 Women 25‐49 Men 55‐64 Women 55‐64
Proportion of people unemployed in the previous year and now inactive
Source: Own elaboration of EU LFS data
The problem with older people drifting into inactivity is that once in that situation there is a risk that they
do not even attempt to return to an active life. The population considered as inactive includes some people
who are still actively seeking work but who do not qualify as unemployed because they are not
immediately available for work (e.g. because of caring responsibilities, illness, training, etc.) but the
numbers of these are small – just under 5% of those aged 25‐49 but less than 1% of those aged 55‐64
(Figure 20). However, there are also people who would like to work but who are not currently seeking
work. Such people account for more than one in four of prime‐age inactivity which, when added to those
already seeking work, makes a total of a third who would like to work. By contrast, amongst older people
less than one in ten is interested in working again ‐ 92% say that they do not want to work. These are EU
level figures, data by country are unfortunately not usable due to the high number of missing values in the
breakdown (small sample size). Within the prime‐age group, a higher proportion of men than women is
interested in returning to work (42.2% vs. 30.3%) but amongst older workers there is little difference
between the sexes (9.9% of men compared to 7% of women).
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 29
Figure 20 ‐ Willingness to work amongst inactive persons by sex and age‐group, 2010
66.5%
91.8%
57.7%
90.1%
69.6%
93.0%
28.6%
7.4%
34.9%
8.8%
26.3%
6.4%4.9% 7.3% 4.0%0.6%1.1%0.8%
0%
20%
40%
60%
80%
100%
25‐49 55‐64 25‐49 55‐64 25‐49 55‐64
Does not want to work Would like to work but is not seeking employment
Seeking employment (but not ILO unemployed)
Total Men Women
Source: Eurostat, Labour Force Survey, lfsa_igaww (figures exclude those that did not answer the question)
It would be interesting to know more about why such a large proportion of people aged 55‐64 become
inactive and are not interested in seeking new employment. Analysis of the way in which people currently
out of work (unemployed or inactive) but working the year before left their previous job (Table 7) reveals
that in 2009 more than half of the older people in this situation in the EU followed the path of retirement.
Of these, 40% reported taking early retirement and 60% regular retirement, though this does not mean
that they reached the official retirement age. It is interesting to note that the proportions forced to leave
their jobs due to redundancy or the end of a fixed term contract increased in 2009, especially the former,
as did the proportion taking early retirement. This is likely to reflect the reality of the crisis when many
people were forced out of their jobs unwillingly and as a result of these involuntary exits, increases the
proportion taking normal retirement, at a time of their choice, fell significantly.
It is worth noting that in several countries the figures differ significantly from the EU27 average (see Annex
– Table A.2). For example, in some Eastern and Mediterranean countries, plus France and Luxembourg
there is a consistently higher share of people aged 55‐64 leaving the labour market through normal
retirement. Early retirement is significantly above average in Denmark, the Netherlands and Poland where
amongst older workers 50% or more of leave their last job for this reason compared to 21% in the EU as a
whole. In Spain and Finland around one in four older people who are out of work say that they left their last
job because a temporary contract ended. This compares to just one in ten at EU level. Although temporary
work is very common in Spain it is so mostly amongst younger workers and in both Spain and Finland less
than 10% of older employees are employed on temporary contracts (Table A.1 in Annex). The high
proportions of older workers who report the end of a temporary contract as the main reason for leaving
their last job thus suggests that this group is particularly vulnerable when a fixed‐term contract comes to
and end.
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European Job Mobility Laboratory, November 2011 30
Table 7 ‐ Reasons for leaving last job for people aged 55‐64 currently out of work but employed in the previous year, EU‐27, 2004‐2009.
% 55‐64
2004 2005 2006 2007 2008 2009
A job of limited duration has ended 8.4 7.1 7.8 8.7 8.5 10.0
Dismissed or made redundant 15.1 15.6 16.5 12.4 11.5 17.2Early retirement 18.9 18.2 19.7 18.9 19.2 21.4
Education or training 0.0 0.0 0.2 0.0 0.0 0.1Normal retirement 36.9 40.0 35.2 39.4 41.4 32.2Own illness or disability 11.2 10.9 11.2 11.1 10.3 9.8Other reasons 9.4 8.2 9.4 9.4 9.1 9.3
Total 100.0 100.0 100.0 100.0 100.0 100.0
Source: Own elaboration of EU LFS data. Other reasons include: Looking after children or incapacitated adults (from2006), other
personal or family responsibilities (includes code 02 from 2006) and other reasons.
Among older workers motivations for leaving their last job largely relate to the possibility of retirement
(more than 50% of cases), which is obviously not a relevant reason among younger people. Excluding those
who left their jobs to retire, the comparison between people aged 25‐49 and 55‐64 becomes more
interesting (Table 8). The main reason why older people who are currently out of work left their last job
other than to retire is dismissal or redundancy (37% of cases in 2009). Three other reasons ‐ termination of
a temporary contract, illness or disability and other reasons all account for around a fifth of the total. For
prime‐age people the main reasons are the termination of a temporary job and redundancy/dismissal. In
both cases, the incidence of redundancy/dismissal increased significantly in 2009 compared to 2007/8 as a
direct result of the crisis. The greatest difference between the older and prime‐age groups lies in the
proportion leaving their last job as result of illness or disability – 5.5% for prime‐age and 21.1% for older
workers. This is a real issue, both for the workers and for employers who associate older workers with
higher risk of health related absence from work. Helping older workers to overcome and manage health
issues and convincing employers that they can do so effectively is a crucial element in the struggle to
improve the employability of older workers.
Table 8 ‐ Reasons for leaving last job, excluding retirement, for people currently out of work but employed in the previous year by age‐group, EU‐27, 2004‐2009
% 25‐49 55‐64
2004 2005 2006 2007 2008 2009 2004 2005 2006 2007 2008 2009
A job of limited duration has ended
33.7 29.8 33.2 32.3 34.6 34.4 19.0 17.1 17.4 21.0 21.6 21.6
Dismissed or made redundant
30.0 31.4 27.3 24.4 22.4 31.9 34.3 37.2 36.5 29.8 29.2 37.0
Education or training 2.2 2.1 2.8 3.0 3.0 2.2 0.1 0.1 0.5 0.1 0.0 0.2Own illness or disability
5.4 6.2 6.8 7.6 6.8 5.5 25.3 26.0 24.8 26.5 26.1 21.1
Other reasons 28.7 30.6 30.0 32.7 33.2 26.0 21.3 19.7 20.8 22.6 23.1 20.1
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Source: Own elaboration of EU LFS data. Other reasons include: Looking after children or incapacitated adults (from2006), other
personal or family responsibilities (includes code 02 from 2006) and other reasons.
When asked the reasons for not seeking work, the majority (58.5%) of older inactive people say that they
are retired, with illness or disability being the second most important reason (16.8%). Indeed, if retirement
is excluded, illness or disability is the main reason for as many as 41% of the remaining people and it
demonstrates the crucial need to deal with physical and psychological health‐related issues when trying to
encourage older people to stay in work. For prime‐age inactive people the main reason is looking after
children or incapacitated adults (mainly a female phenomenon), followed also by illness or disability.
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 31
Interestingly, the proportion of older inactive people who say that the main reason for not seeking work is
that they believe none is available is very low (3.6% in 2010) and lower than for prime‐age people. Even
excluding those who say they are retired, the proportion is hardly any different from the prime‐age group –
discouragement affects just under 9% of each group. This is somewhat surprising given some of the
evidence presented earlier – older workers who lose their jobs struggle to find work – they are liable to
become long‐term unemployed and many drift from unemployment to inactivity, which would suggest that
they have become discouraged and given up looking for work. Perhaps once they have retired this becomes
the main reason for no longer seeking work and if they were to be asked the reason for retiring perhaps
more would highlight discouragement effects. However, this is an intuitive interpretation and cannot be
confirmed from the available data.
Table 9 ‐ Reasons for not seeking work for inactive people by age group, EU 27, 2006-2010
% 25‐49 55‐64
2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
All reasons Awaiting recall to work (persons on lay‐off) 0.9 0.9 0.9 1.1 1.2 0.2 0.2 0.1 0.2 0.2Looking after children or incapacitated adults
25.0 25.5 29.4 28.8 28.8 1.8 1.7 2.1 2.1 2.2
Belief that no work is available 7.6 7.4 6.7 7.6 8.3 3.4 3.0 3.0 3.3 3.6
Education or training 10.9 10.7 10.3 10.9 11.1 0.2 0.1 0.1 0.1 0.1Other personal or family responsibilities 19.5 19.3 15.7 15.1 13.9 8.1 8.1 7.3 7.0 6.5
Other reasons 16.8 16.5 15.3 15.6 15.4 13.6 13.4 12.9 12.4 12.0Illness or disability 16.6 17.4 19.4 19.0 19.3 15.3 15.6 16.8 16.6 16.8
Retirement 2.6 2.4 2.3 2.0 1.9 57.5 57.9 57.7 58.3 58.5
Excluding retirement
Awaiting recall to work (persons on lay‐off) 0.9 1.0 0.9 1.2 1.3 0.4 0.4 0.3 0.5 0.5
Looking after children or incapacitated adults 25.7 26.1 30.1 29.4 29.3 4.2 4.1 5.0 5.0 5.2
Belief that no work is available 7.8 7.5 6.8 7.7 8.5 8.1 7.2 7.0 8.0 8.7
Education or training 11.2 11.0 10.5 11.1 11.4 0.4 0.1 0.2 0.1 0.2
Other personal or family responsibilities 20.1 19.7 16.0 15.4 14.2 19.0 19.2 17.2 16.7 15.8
Other reasons 17.3 16.9 15.7 15.9 15.7 32.0 31.8 30.6 29.8 29.0
Illness or disability 17.0 17.8 19.9 19.4 19.7 36.0 37.2 39.7 39.8 40.6
Source: Own elaboration of EU LFS data
2.6 Labour market transitions: re‐employment rates
The consequences of job loss can be particularly serious for older workers who are liable to have more
difficulty finding a new job than their younger counterparts. Moreover, even amongst those that do find
work there is a substantial risk that the new job will pay considerably less than the previous one (Johnson
and Mommaerts, 2011). Although this issue is beyond the scope of the current study, it has to be
highlighted because the potential magnitude of a drop in wages is likely to be an important disincentive for
displaced older workers to return to work.
Re‐employment rates measure the proportion of people who were out of work (unemployed or inactive) in
one year but employed in the next. Not surprisingly, people who are unemployed – and therefore by
definition actively seeking work – are more likely to be re‐employed than those who are inactive. What is
striking, however, is the difference between prime‐age and older workers (Figure 21). In 2010, nearly one in
three (31.2%) prime‐age workers who were unemployed in 2009 had found work but for the older
unemployed the chances of finding work were only one in seven (14.2%). In other words, an older worker
who is unemployed has less than half the chance of finding work again as a prime‐age worker. This
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 32
inevitably contributes to the high level of long‐term unemployment amongst older workers discussed
earlier.
Figure 21 ‐ Re‐employment rates by activity status and age‐group, EU‐27, 2004‐2010
25‐49
19.1%
5.7% 6.8%
31.2%
14.6%18.0%
16.2%
11.3%
17.0%
8.4%
32.0% 29.6%
36.8%
30.7%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2004 2005 2006 2007 2008 2009 2010
Other inactive Retired Unemployed
55‐64
14.2%
5.2%
3.3%
12.2%15.7% 12.9%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2004 2005 2006 2007 2008 2009 2010
Other inactive Retired Unemployed Source: Own elaboration of EU LFS data
There is a similar pattern for people who are inactive. For those who consider themselves retired, rates of
return to work are not surprisingly low – just 3.3% for those aged 55‐64 but roughly double this rate (6.8%)
for those aged 25‐49. More striking, however, is the difference between prime‐age and older workers for
all other categories of inactive persons, which includes those looking after the home or dependent
relatives, students, people who are sick, etc. Amongst this group, the rate of re‐employment amongst
prime‐age workers is 19.1% or nearly one in five but for older workers the rate is only 5.2% or one in
twenty. Indeed, amongst older inactive workers there is little difference in the re‐employment rates of
those who consider themselves retired and those in other situations of inactivity. For all of them the
likelihood of returning to work would appear to be very slim.
In general, re‐employment rates are higher for men than for women though the differences are more
prominent for prime‐age workers and amongst older workers are only significant for people who are
inactive but not retired (Figure 22). The most significant difference between the sexes is for prime‐age
inactive people (other than retired) where the re‐employment rate of men is some 6 percentage points
higher than that of women. The chances of finding work again are also affected by level of education, the
re‐employment rate increases with a better educational level for all groups (Figure A.2 in annex). It means
that older workers with low levels of education have the least chance of finding work again after losing
their job or, perhaps, that they are least likely to try to return to work.
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 33
Figure 22 ‐ Re‐employment rates by activity status, age‐group and gender, EU‐27, 2004‐2010
Other inactive in the previous year
23.8%
17.8%
1.9% 2.4%
20.4%
25.1%21.4%
13.0%16.0%
14.7%
6.8%4.6% 4.8%4.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2004 2005 2006 2007 2008 2009 2010
Men 25‐49 Women 25‐49 Men 55‐64 Women 55‐64
Retired in the previous year
11.6%
7.3%
3.5%
16.1% 9.2%
18.1%
2.9% 3.5%
4.0%0%
5%
10%
15%
20%
25%
30%
35%
40%
2004 2005 2006 2007 2008 2009 2010
Men 25‐49 Women 25‐49 Men 55‐64 Women 55‐64
Unemployed in the previous year
32.6%31.6%
39.4%
34.2%
29.6%29.8%
34.4%
29.7%
13.6%16.8%
13.4%14.3%
12.1%14.2%
10.1%
14.1%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2004 2005 2006 2007 2008 2009 2010
Men 25‐49 Women 25‐49 Men 55‐64 Women 55‐64
Source: Own elaboration of EU LFS data
The literature offers a number of reasons why older displaced workers are less likely to become re‐
employed than younger workers. On the demand side, employers are reluctant to hire workers aged 55 or
over, because they are considered less productive and adaptable. Employers fear that they will not have
the time to recoup hiring and training costs before the employee retires (Johnson and Mommaerts, 2011)
and may also express concern that older workers are more expensive because of rigid seniority‐based wage
structures.
From the labour supply perspective, financial incentives embedded in pension systems and other welfare
benefits may play an important role in pushing older workers out of the labour market. Heyma and Van
Ours (2005) found that in the Netherlands abolishing the active job‐search requirement for recipients of
unemployment benefits from the age of 57.5 through to 65 (pension age) had a negative effect on the job
finding rate. Other studies have shown that lengthening the entitlement period of unemployment benefits
for older workers led to declines in the rates of transition to employment in Germany and Austria (Hunt
and Friedberg, 1995; Lalive, Van Ours and Zweimüller, 2004), and provided an important pathway into early
retirement (Lalive, 2006). On the other hand, reducing access to early retirement schemes can have very
positive effects. In Finland in 1997, the age at which people could stop collecting unemployment benefits
and transfer to an early retirement scheme was raised from 53 to 55. The result was that for the 53‐54 age‐
group the risk of unemployment fell, unemployment spells were shorter and transitions from
unemployment to employment increased (Kyyra and Wilke, 2007).
Such findings have important policy implications for the reforms needed to respond to the demographic
changes in Europe and the pressure they place on social security systems. In particular, policies aimed at
increasing the employment rates of older workers should take into account the role of job displacement
and its interaction with systems that can affect individual incentives. For instance, policies that aim to
enhance the chances of re‐employment for older workers might not be effective when used alongside a
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European Job Mobility Laboratory, November 2011 34
generous unemployment insurance system that offers a low‐effort and relatively secure pathway to
retirement.
2.8 Labour market transitions: longer‐term observations
The data used for the majority of the analysis in this study derive from the Labour Force Survey, where for
the large part of the sample it is only possible to compare the situation of a person in one year with that in
the previous year. However, longitudinal data from the EU‐SILC, which are currently available for the period
2005‐2009, contain information on the employment status of those surveyed in each month over these 4
years so that it is possible to track their movements over 48 consecutive months, for example, from
employment into unemployment and back again or from unemployment into inactivity because of a failure
to find a job.
The sample chosen for study are those aged 50‐59 at the start of the period, i.e. in January 2005. Therefore,
the oldest person at the end of the period (in December 2008) still remains below the official retirement
age in most countries. Although the focus of the rest of the analysis is on those aged 55‐64, the relatively
small sample size of the EU‐SILC (especially of those included in the longitudinal survey for a 4‐year period,
who represent only 25% of the total number of people surveyed) means that the age group analysed needs
to be relatively wide in order to ensure that sufficient people are covered to make the results reliable. Even
then much of the analysis has to be carried out for groups of EU Member States in order to be sure that a
sufficient number of people are covered. It should be noted that these data are not available for all
Member States. There are no data in particular for Germany as well as Ireland and Romania. The analysis
therefore is inescapably limited to 24 of the 27 EU Member States.
Three broad issues were addressed on the basis of the data:
1. How many people who become economically inactive over the age of 50 – i.e. who in most cases
move into retirement – subsequently move back into employment, not necessarily in the same kind
of job they were doing before but into any kind of work? Are there more men than women or vice
versa who so this? How does the proportion vary by educational attainment level?
2. How many people who lose their job at this age are able to find another one? Are the chances
greater for men or women? What effect does education level have on these chances? How long do
people typically spend in unemployment before they find a job?
3. How many of those who become unemployed at this age subsequently move into retirement or
other forms of inactivity rather than back into work? To what extent does this vary between men
and women and how is it affected by education level?
Re‐employment from inactivity
Earlier it was shown that more than half of people aged 55‐64 moving from employment to inactivity do so
because they are retiring (Table 7) and that the chances of someone who is inactive in one year being re‐
employed in the next are slim (less than 5%). Using EU‐SILC data allows this analysis to be carried out over a
longer period and also to capture intra‐year changes. Table 10 orders countries in terms of the proportion
of people in the age group 50‐59 who moved from a spell of inactivity back into employment over the 4‐
year period 2004‐2008. The figures would appear to be generally in line with the annual data from the LFS –
given that they cover a four year period it would be expected that the chances of re‐employment over the
period would be higher and this is indeed the case, though not by much – the average is more like 7%
compared to around 4% on an annual basis. There are, however, notable differences between countries,
with people in the Netherlands, the UK, Finland and Sweden much more likely to have moved back into
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European Job Mobility Laboratory, November 2011 35
work at some point in the four year period (between 11 and 15%) than those in France, Luxembourg, the
Czech Republic, Malta or Slovenia (all less than 3%). There is no pronounced tendency for a larger
proportion of men than women or vice versa to move back into employment, nor is there much sign of
education level affecting the numbers.
Table 10 ‐ Proportion of men and women aged 50‐59 in 2005 who moved out of inactivity into employment over the 4 years 2005‐2008
Sex: Men Women Total
Level of education: Low Med. High Total Low Med. High Total Low Med. High Total
NL 18.7 9.5 19.7 15.2 19.1 12.0 17.5 16.1 19.0 10.7 19.0 15.7
UK 16.7 12.0 21.6 15.7 13.2 17.7 14.8 15.5 14.5 15.0 18.4 15.6
FI 0.9 11.6 4.4 6.9 24.0 16.4 17.5 18.9 13.9 13.8 12.0 13.2
SE 10.9 11.0 20.9 13.4 13.6 7.2 11.3 9.8 12.0 9.1 15.7 11.7
PL 12.6 8.8 12.9 10.0 15.4 6.2 8.9 8.8 14.2 7.5 10.7 9.4
HU 1.3 8.2 12.4 7.9 7.9 10.0 12.9 9.9 6.1 9.1 12.7 9.0
IT 8.6 10.4 8.9 9.2 8.2 9.4 5.5 8.2 8.4 9.9 7.2 8.7
LV 12.3 8.4 13.3 10.0 5.0 8.3 7.3 7.7 8.8 8.3 9.6 8.7
BG 12.4 9.2 0.0 9.3 7.1 11.4 3.4 8.0 9.9 10.3 2.5 8.6
AT 10.0 3.5 0.0 4.2 11.7 10.6 8.1 10.7 11.1 7.5 2.9 7.8
PT 7.4 0.0 17.5 7.5 7.4 0.0 0.0 6.4 7.4 0.0 5.9 6.9
DK 13.4 2.6 13.1 8.6 5.8 5.1 3.8 5.0 9.0 3.7 8.5 6.8
BE 7.3 10.5 2.2 6.5 1.3 6.8 12.2 6.0 4.1 8.6 7.0 6.3
ES 3.4 4.4 3.8 3.7 12.0 10.7 3.5 10.6 6.1 5.7 3.7 5.5
CY 2.7 2.5 3.3 2.8 8.9 4.4 5.6 6.8 6.1 3.5 4.3 4.9
LT : 4.3 3.5 5.2 0.0 6.3 2.7 4.5 5.5 5.4 3.0 4.8
GR 0.9 0.0 7.6 2.0 9.0 4.1 0.0 6.6 5.3 1.9 4.1 4.4
EE 7.9 3.5 3.1 3.8 4.6 4.4 3.1 3.9 6.0 3.9 3.1 3.9
SK : 1.0 2.4 2.4 0.0 3.3 9.5 3.8 5.3 2.3 5.6 3.2
SI 3.8 3.6 3.8 3.7 2.1 3.2 0.0 2.1 2.8 3.4 1.7 2.9
MT 1.3 2.3 : 2.4 1.0 : : 2.8 1.2 6.0 14.0 2.6
CZ 1.3 2.3 0.0 1.9 0.5 3.2 6.9 2.9 0.7 2.8 2.5 2.4
LU 1.1 0.0 1.8 0.8 5.8 4.1 0.1 4.3 3.8 1.5 1.2 2.4
FR 0.4 1.1 1.2 0.8 2.2 1.9 0.0 1.8 1.4 1.4 0.6 1.3 Source: EU‐SILC. Data exclude DE, IE and RO ; “ : “ indicates that the sample is too small to be reliable.
Re‐employment from unemployment
Considering only people who were in employment at the start of 2005, nearly one in twelve (8.6%) became
unemployed at some point during the following 48 months (Table 11). The data shows clearly that the
chances of unemployment are significantly greater among those with low education and that the chances
for those with tertiary level education are very low. This is true in both the EU‐12 countries (i.e. the
Member States which have entered the EU since 2004) and the EU‐15, though the difference is more
pronounced in the EU‐12. Men are more likely to become unemployed than women, particularly in the EU‐
12, though this might reflect the possibility that more women in this age group did not bother looking for
another job if they lost their existing one and went directly into retirement.
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European Job Mobility Laboratory, November 2011 36
Table 11 ‐ Proportion of men and women aged 50‐59 and employed in 2005 who experienced a spell of unemployment over the 4 years 2005‐2008
Men Women Total
% Low Med. High Total Low Med. High Total Low Med. High Total
EU12 16.1 10.9 5.1 10.5 12.3 9.4 3.5 8.5 14.1 10.2 4.2 9.5
EU15 10.8 9.5 3.3 8.5 9.8 8.8 4.2 8.1 10.4 9.2 3.7 8.3
EU27 11.2 9.9 3.6 8.9 10.1 9.0 4.0 8.2 10.7 9.5 3.8 8.6 Source: EU‐SILC. Data exclude DE, IE and RO
Of those people aged 50‐59 who were employed at the start of 2005 but then became unemployed, more
than half found another job at some point in the remaining months of the 4‐year period (Table 12). This
figure is perhaps high when compared to the figure from the LFS which indicates that more like 15% of
people aged 55‐64 were unemployed in one year but employed in the next (see Figure 21). However, there
are a number of factors that contribute to this difference. The SILC data cover only people who started the
period in work and do not include people who were already unemployed or who were inactive and then
became unemployed. The SILC data are therefore restricted to people with recent experience of work who
are likely to be more employable. They also take account of movements into work at any point over the 4‐
year period whilst the LFS data compare the situation of individuals one year apart and with a high
proportion of older unemployed being out of work for more than a year, sometimes considerably so, a
significant proportion of re‐employment cases will occur only at a later date. The age‐group covered may
also have an impact – the LFS data showed clearly that re‐employment rates amongst younger age‐groups
were significantly higher than in the 55‐64 age‐group and the fact that the SILC data covers a cohort that
starts off five years younger will tend to result in higher re‐employment rates.
Results based on the SILC data (Table 11) show little difference between the EU‐12 and EU‐15 in terms of
overall re‐employment rates but do suggest important differences between the two as regards those with
different education levels, especially for men. In the EU‐12, men with tertiary level education were
significantly less likely to have found a job than those with lower or upper secondary education, though this
is not the case for women. The reverse situation applies in the EU‐15 where people with high levels of
education, both men and women, were much more likely to find work again. These findings broadly concur
with the LFS data.
Table 12 ‐ Proportion of men and women aged 50‐59 and employed in 2005 who became unemployed and found another job over the 4 years 2005‐2008
Men Women Total
% Low Med. High Total Low Med. High Total Low Med. High Total
EU12 54.1 60.5 38.9 57.3 63.9 49.0 61.6 53.7 58.7 55.8 48.8 55.8
EU15 50.9 53.4 76.6 54.3 48.9 58.2 70.1 55.6 50.1 55.4 73.4 54.8
EU27 51.3 55.8 67.9 55.0 51.1 55.2 68.4 55.1 51.2 55.6 68.1 55.1 Source: EU‐SILC. Data exclude DE, IE and RO
Around 17% of the same group (i.e. those employed at the start of 2005 and then unemployed) moved into
inactivity instead of into a job and remained in that situation to the end of the observation period (Table
13). Given the age‐group, it is likely that the majority of these people will have retired but this cannot be
verified from the data and some may be in other situations (e.g. sick or caring for others). This transition
was more common in the EU12 (24%) than the EU15 (14%) where, accordingly (given that similar
proportions found work again), more people remained unemployed, perhaps because they considered it
more likely that they would eventually find a job or because the social protection system, and perhaps the
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 37
PES, supported and encouraged them to keep looking. In the EU12, though not so much in the EU15, it is
people with highest levels of education that are most likely to move from unemployment into retirement
(or other inactivity), perhaps because they can afford to do so in the sense of having access to a pension.
Again, it is worth reflecting briefly on differences between the observations based on SILC data and those
reported earlier based on LFS data. The latter showed that as many of 46% of those aged 55‐64 who were
unemployed in 2009 were inactive in 2010, which is significantly higher than the 17% observed in the SILC
data. Firstly, as mentioned previously, the SILC data cover a restricted sample of those employed at the
start of the period and excludes people who were unemployed at that time or who were inactive and then
became unemployed. These groups are liable to be less employable due to a more distant experience of
work and therefore more likely to give up looking for work. Additionally, the SILC data on labour status are
self‐reported and some of those who consider themselves unemployed are liable to be counted as inactive
in the LFS where the strict ILO criteria are applied.
Table 13 ‐ Proportion of men and women aged 50‐59 and employed in 2005 who became unemployed and then moved into retirement or other inactivity over the 4 years 2005‐2008
Men Women Total
% Low Med. High Total Low Med. High Total Low Med. High Total
EU12 12.5 17.3 47.1 19.0 12.1 35.2 37.1 30.0 12.3 24.5 42.7 23.6
EU15 9.0 14.0 12.9 11.4 24.2 16.6 5.7 18.6 14.8 15.1 9.4 14.4
EU27 9.4 15.1 20.7 13.2 22.4 22.8 11.9 21.4 14.5 18.3 16.6 16.6
2.8 Job‐search methods of older workers
Older and prime‐age workers have slightly differently job‐seeking habits. Most people use multiple
methods for seeking work but, on average, prime‐age unemployed persons seem more active and use more
than 4 different kinds of research methods per person, while older unemployed persons use an average of
3.5 different methods (Table 14); in both cases the intensity of research has increased in recent years,
probably as a result of the crisis and the increasing difficulties in find a job.
Prime‐age unemployed people are most likely (in order) to study adverts in newspapers or journals, exploit
personal networks or to apply directly to employers. In 2010, 61% of prime‐age unemployed say that they
contacted the public employment service within the past four weeks in order to seek work, while 19% was
waiting for a call from a PES office. However, older workers are most likely to refer to the public
employment service, followed by adverts or personal contacts. They are much less likely than prime‐age
workers to contact employers directly (47% vs. 62%). Interestingly, the use of the public employment
services seems to be declining for both age‐groups, while direct application to enterprises and networking
with friends, relatives and trade unions increased in the last years. According to the data, use of private
employment agencies is relatively infrequent with only 20‐25% of prime age unemployed and 15‐17% older
unemployed saying that they used this method.
Although they may not be immediately available for work, part of the population considered inactive also
wants to work and is taking steps to find work. In this case the intensity of the research is lower than for
unemployed people, and on average the prime‐age group use 2.3 methods, while older inactive people use
around 1.5. As with unemployed jobseekers, the proportions using each method are lower for the older
workers than prime‐age workers in almost all cases, indicating that they are generally less likely to use
multiple job‐search methods.
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European Job Mobility Laboratory, November 2011 38
For both prime‐age and older inactive people, contacting the public employment service was the most
common method of job‐search in 2010, though the numbers are relatively low – less than half of prime‐age
and only just over a third of older inactive jobseekers contacted the PES within the last four weeks (Table
15). If PES are to effectively help activate such groups, ways of increasing contact need to be found. It is
noticeable, moreover, that use of the public employment service has declined significantly for the older
age‐group.
Table 14 ‐ Job‐search methods of the unemployed by age‐group, EU‐27, 2006‐2010
% using each method 25‐49 55‐64
Methods 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Contacted public employment office 65.4 65.0 61.8 61.9 60.9 72.0 72.9 68.7 64.8 65.5
Contacted private employment agency 20.4 20.4 22.5 24.1 23.7 15.4 14.9 16.0 17.0 17.0
Applied to employers directly 51.7 50.2 52.9 60.1 62.3 33.7 35.2 36.4 44.9 46.8
Asked friends, relatives, trade unions, etc. 62.6 61.7 62.3 68.4 70.8 50.6 50.3 50.0 60.6 62.0
Inserted or answered advertisements in newspapers or journals
43.6 42.1 40.4 43.5 45.1 37.5 37.0 34.7 38.6 36.6
Studied advertisements in newspapers or journals 69.1 67.9 67.8 72.3 73.6 58.5 56.6 59.1 64.3 64.4
Took a test, interview or examination 17.1 17.3 17.8 17.7 17.9 8.8 9.3 8.5 9.2 9.7
Looked for land, premises or equipment 3.3 3.3 3.5 2.1 1.9 1.5 1.6 2.3 1.5 1.4
Looked for permits, licenses, financial resources 2.4 3.1 3.3 1.6 1.7 1.0 1.6 1.7 1.0 1.1
Awaiting the results of an application for a job 16.8 17.1 18.0 20.1 21.9 9.3 10.2 9.7 12.2 13.9
Waiting for a call from a public employment office 15.1 14.3 15.0 18.1 19.4 10.5 11.4 11.9 15.1 15.8
Awaiting the results of a competition for recruitment to the public sector
1.4 1.4 1.3 1.4 1.6 0.4 0.3 0.2 0.5 0.5
Other methods 22.8 24.6 22.8 18.2 16.7 19.7 21.7 19.5 18.4 18.8
Average number of methods used 3.9 3.8 3.8 4.1 4.1 3.2 3.2 3.1 3.5 3.5
Totals in each column exceed 100% because many jobseekers use multiple methods. Source: Own elaboration of EU LFS data
Table 15 – Job‐search methods used by inactive people seeking work by age‐group, EU‐27, 2006‐2010
% using each method 25‐49 55‐64
Methods 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010
Contacted public employment office 48.0 50.2 41.5 45.7 46.1 51.7 57.5 40.3 45.2 34.6
Contacted private employment agency 9.0 10.2 9.1 10.3 9.7 4.2 2.7 3.9 7.1 7.2
Applied to employers directly 22.5 21.3 20.9 27.1 24.8 5.0 7.4 7.0 14.3 14.3
Asked friends, relatives, trade unions, etc. 31.2 31.8 28.8 35.7 34.3 10.0 16.3 12.2 22.5 24.7
Inserted or answered advertisements in newspapers or journals
21.3 22.0 19.8 27.0 26.4 8.5 8.4 8.9 18.9 15.3
Studied advertisements in newspapers or journals 38.6 39.6 36.1 44.9 42.3 16.2 14.8 15.1 34.0 29.9
Took a test, interview or examination 8.2 7.3 8.7 9.7 8.3 1.9 1.7 2.5 3.9 2.5
Looked for land, premises or equipment 3.6 3.1 2.4 2.8 2.9 0.5 0.4 0.2 0.5 0.6
Looked for permits, licenses, financial resources 3.7 2.6 2.3 2.5 2.7 0.3 0.2 0.4 1.9 0.4
Awaiting the results of an application for a job 7.8 7.8 7.9 10.6 9.7 1.4 2.5 3.3 5.5 7.9
Waiting for a call from a public employment office 14.1 12.8 9.0 9.1 9.3 28.1 22.9 14.5 12.8 10.3
Awaiting the results of a competition for recruitment to the public sector
1.0 0.9 1.0 0.8 0.9 0.0 0.0 0.7 0.1 0.8
Other methods 16.8 18.7 16.4 18.6 17.1 6.2 11.2 8.6 13.3 12.5
Average number of methods used 2.3 2.3 2.0 2.4 2.3 1.3 1.5 1.2 1.8 1.6
Totals in each column exceed 100% because many jobseekers use multiple methods. Source: Own elaboration of EU LFS data
These results prompt some general reflections on the role of PES in supporting the job‐search activities of
senior workers:
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 39
there are many ways of seeking work and most people use multiple search methods but the PES
still plays a central role for both unemployed and inactive people, and especially for older people;
traditional methods of jobsearch such as responding to adverts in printed media or networking
through relatives and friends continue to have an important function and should not be seen as
alternative but complementary to the PES;
PES are used actively by a large number of job seekers but there is room to extend their action
especially among older inactive and older people, whose current use is more limited;
the tendency for direct contact with companies to increase as a method of job‐search is probably
linked to modern communications technology. Again, although such methods reduce the need for
intermediaries, they should not be seen as an alternative to PES and are (or can be) supported by
them.
2.9 Summary of main findings from the analysis of labour market trends
Analysis of the labour market situation of older workers and the impact of the crisis shows that:
There is a long‐term trend for people to work longer, which has resulted in a significant increase in
employment rates of older workers over the past decade or so. The crisis has slowed but not arrested
this trend and employment of older workers is continuing to rise. In this sense, older workers are doing
well on the labour market compared to other age‐groups, which suffered the brunt of job‐losses during
the recession. However, employment rates of older workers in many European countries are still
relatively low, a long way behind those of other advanced economies, and this is not sustainable in the
medium to long term as the population ages and there are projected labour shortages and an increased
demand for pensions and long‐term care. Combined in the right way, ALMP and other services of the
PES can be used to strengthen the general trend to stay longer in work by acting to remove constraints
in work organisation, social habits and local welfare.
Older workers are more likely than prime‐age workers to be employed for less than full‐time hours,
which makes sense as a transition to retirement. They are less likely to be employed on a temporary
contract and more likely to be self‐employed. The former may have offered some protection during the
crisis as those on fixed‐term contracts were among the first to be dismissed. However, there is no real
evidence to suggest that any of these factors can fully explain why older workers were less affected by
the crisis. It is clear, however, that a well defined system of reduced working time could be a useful
instrument to keep older workers at work and that, without resorting to early retirement schemes, the
mutual interests of older employees and employers can be maintained even in a period of crisis.
Older workers are less likely to be unemployed than other groups but once they lose their jobs the
problems start. Once unemployed, older workers take much longer to find work and are liable to
become long‐term unemployed. The rate of re‐employment is low ‐ only one in seven older people who
were unemployed one year are back in work in the next compared to one in three prime‐age workers.
This difficulty in getting back to work implies that extra effort is required from the PES to help them
effectively. In particular, PES have to learn to deal with the multidimensional problems that tend to
confront older workers (family care, health, low marginal return of investment in human capital, self‐
empowerment) in relation to their age and the condition of long term unemployment.
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European Job Mobility Laboratory, November 2011 40
Moreover, around half of older unemployed each year give up looking for work and become inactive.
The low chances of finding work (evidenced by the high incidence of very long‐term unemployment
among older workers) represent a level of discouragement such that many older workers leave the
labour market much earlier than they would like. This type of exit is facilitated by the persistence in
some countries of early retirement schemes and extended eligibility to unemployment benefits without
any obligation to seek work.
Once inactive, the chances of returning to work are minimal. Re‐employment rates of older workers are
not surprisingly low for those who say that they have retired (3%) but are also very low for other
categories of older inactive people (5%). This, together with the previous points, highlights how
important preventive interventions that can help to preserve employability and anticipate
discouragement effects may be for older workers.
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European Job Mobility Laboratory, November 2011 41
3. Overview of national initiatives to support older workers
Having shown the problems that out‐of‐work older workers have in finding new employment, the question
is what is being done to help them and what more needs to be done. In terms of help aimed at improving
the employability of older workers or creating jobs for them the answer to the first part of the question is
that, upon a review of policy documents and available report of empirical research, there are important
initiatives in some EU Member States, but there is no systematic approach and the initiatives are generally
few compared to those targeting other age groups. Although there is a multitude of active LMP services
and measures specifically targeted at young people who, it has to be said, were particularly hard hit by the
crisis, few public employment services offer employability services/measures specifically targeted at older
workers. Older workers are free to participate in the full range of labour market services/measures on offer
and there are also various systems of employment subsidy to encourage employers to both recruit and
maintain jobs for older workers. However, there would appear to be a lack of services/measures designed
to improve the employability of older workers and which are really tailored to their specific needs,
including health issues. PES are now required to address the labour needs of unemployed and employed
job seekers among the 55+ age group who, until recently, have not among the priority client groups of PES
(Hake, 2011).
This chapter presents five small case studies from Bulgaria, France, Germany, the Netherlands and Poland.
The first case gives an example of an inter‐generational approach, facilitating the re‐entry of both older
workers and new parents into the labour market; the second case presents the overall strategy and main
initiatives that the French PES has put in place in order to support senior workers’ employability; the
German case describes an initiative aimed at activating and re‐integrating long‐term unemployed older
workers into the labour market, using also innovative tools such as psychological and heath support; the
Polish practice provides an example of a stimulus to self‐employment; finally the Dutch experience shows
how to promote labour participation of jobseekers aged 55‐60, using coaching and networking groups.
Each case study is structured as follows: the national context in which it was implemented; the policies to
both retain and re‐integrate older workers (programmes and achievements), and, where available, a brief
overview of the overall PES strategy towards older workers; the conclusions and lessons learned from these
experiences. In addition to the case studies, the chapter includes a brief examination of employment
subsidies for older workers available across EU Member States.
3.1 Bulgaria
This first case‐study focuses on the Bulgarian experience with particular attention on a scheme called “Back
to work”.
The national context
The demographic changes that tend towards an ageing population and shrinking workforce represent a real
challenge to the long‐term economic and fiscal sustainability of Bulgaria. Those aged 55‐64 are a already
significant portion of Bulgaria’s labour force (14%) and their importance is likely to increase over time. As a
result, measures are needed to increase the labour market participation of senior workers and the supply
of labour.
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European Job Mobility Laboratory, November 2011 42
The pension reform adopted recently (in force from 2012) envisages a gradual increase in the length of
service for workers to 40 years for men and 37 years for women. The retirement age will also increase to 63
in 2026 for women and 65 in 2024 for men.
The activity and employment rates for people aged 55‐64 in Bulgaria are considerably lower than those for
the overall working age population (25‐64), though both have almost doubled since 2000 and the
employment rate for people 55‐64 in 2010 (43.5%) was not too far from the EU average (46.3%). However,
in the 2008 ‐ 2010 period, following the financial and economic crisis, the employment rate in Bulgaria
started to diminish for all age groups, including older workers, and unemployment rates increased. The
table below shows that the employment impact of the crisis on older workers is similar to that of the
overall working age population. Interestingly, during the crisis job opportunities for older employees
decreased significantly in the private sector but actually increased in the public sector. The number of self‐
employed, employers and unpaid family workers aged 55‐64 also fell, reflecting the fact that family
businesses were affected by the effects of the recession.
Table 16 ‐ Activity, employment and unemployment rates (total and older workers)
Years Activity rate Employment rate Unemployment rate
25‐64 55‐64 25‐64 55‐64 25‐64 55‐64
2000 69.6 25.1 59.6 22.1 14.4 12.2
2005 70.6 29.4 64.2 34.7 17.7 8.6
2007 75.5 45.7 70.8 42.6 6.2 6.8
2008 76.8 48.7 73.0 46.0 5.0 5.5
2009 76.0 49.2 71.4 46.1 6.0 6.3
2010 75.0 47.9 68.1 43.5 9.2 9.3
Source: Eurostat, Labour Force Survey: lfsa_ergan, lfsa_urgan, lfsa_argan
As elsewhere in Europe, the serious problems for older workers in Bulgaria arise once they become
unemployed. The options for people aged 55‐64 who lost their jobs are limited: entering a special job‐
searching programme, finding (precarious) work in the “grey economy” or exiting the labour market
altogether. Though there is also an additional option, as some unemployed people aged 50+ may emigrate
and find work as agricultural workers or housekeepers in neighbouring countries. Whether unemployed,
employed or inactive, older people face a variety of problems in getting and keeping jobs in the longer
term. These include: lack of recent experience in job search, health issues, and persistent negative
perceptions about the motivations and capacities of older workers to adapt to technological and
organisational change. Changes to the skill sets required by employers reduce the competitiveness of this
age group. In this sense the underdeveloped life‐long learning (LLL) system in Bulgaria is also a problem, as
only 1.4% of the labour force in the country participated in LLL in 2009. In addition, the difficulties senior
workers face in employment reintegration were exacerbated by the recent economic downturn because of
the tight labour demand causing a higher competition with other jobseekers.
Measures to retain and (re‐)integrate older workers
The situation described above outlines the need for relevant labour market policies to support the
employment re‐integration of older workers in the event of unemployment. Moreover, in the present
economic situation, the risk of large‐scale displacement and long‐term unemployment of older workers has
increased progressively. In order to overcome this situation, an integrated flexicurity approach is being
implemented. National policy recognises senior workers as a vulnerable group and the National
Employment Agency of Bulgaria (NEA) is implementing actions within the context of the Encouragement of
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European Job Mobility Laboratory, November 2011 43
Employment Act (EEA) and in the National Action Plan for Employment in order to sustain the social
integration of unemployed people over 50. Although active labour market measures in Bulgaria are
generally open to all age groups, in recent years a number of national funded initiatives specifically directed
to unemployed people over 50 have been successfully implemented:
A national programme called “Help for Retirement”. This programme provides employment to
unemployed people who are 5 points short of qualifying for the right to a pension. Unemployed people
are provided with full or part‐time work for a period of 3‐12 months, depending on how many points
they need to earn. The programme pays all expenditure incurred by the employer, including wage,
social insurance, additional payments, etc. In order to participate in the scheme, the unemployed
person should not be over 65+, as at that age people obtain pension rights automatically. There were
1,394 participants in the programme in 2010 and the programme had a budget of 3.9 million BGN9, of
which 3.4 million came from the state budget. In 2011 the programme aims to provide employment to
742 people with a budget of 1.9 million BGN.
Under the Encouragement of Employment Act (art. 55a of EEA), there is a measure providing financial
incentives to employers who hire people aged 50+. In 2010, 375 people were employed under this
measure, which had a budget of 357,000 BGN. The same act includes a measure to encourage
employers to hire unemployed people between 50 and 64 years old, who have acquired a right to a
professional pension for earlier retirement (article 55 b of LEE).
People aged 50+ are also one of the target groups of the national programme “Social Services in Family
Environment”, through which unemployed people provide caring services to other people (i.e. disabled
people).
The National program “Supporting motherhood”, in which older workers are trained to work as child
minders.
ESF funded initiatives targeted mainly at unemployed people over 50s have also been deployed:
The initiative “Back to work”, continues the framework of the above mentioned national programme
‘Supporting motherhood’, which offers job placement opportunities to older people to help young
workers with children to combine family and professional life. This initiative is described in detail
below10.
“Development” Scheme is a part of the Operational Programme “Human Resource Development”.
Under this scheme people aged 50+ are given the opportunity to obtain relevant qualifications. In 2010,
2,627 workers aged over 55 were given training. The funding provided amounted to 640,000 BGN.
People aged 50+ have also access to all programmes, encouragement measures and schemes of
“Human Resource Development Operational Programme”.
Other initiatives funded by the ESF to support senior workers (such as those for training activities or
inter‐generational transfer of knowledge – i.e. “Providing conditions for active working life for people
over 50 and long‐term unemployed persons”, or the initiative “Creating employment for youth through
insuring a chance for apprenticeship”)
The “Back to Work” project represents an interesting initiative that offers training and job placement
opportunities to older people wanting to work in the child‐care industry, while providing also opportunities
9 The exchange rate between the Bulgarian Lev and Euro was 1BGN = 0,51 € on 10 November 2011. 10 The initiative is not directly targeted at unemployed people over 50, however these people have priority.
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European Job Mobility Laboratory, November 2011 44
for younger workers with children to return to work. The scheme started in 2009 in the wake of the
National program “Supporting motherhood”, as a programme promoting reconciliation of work and family
life of both parents (in line with the broader policy of the Bulgarian Ministry of Labour and Social Policy). It
was originally established to aid the integration of young mothers in the labour market by providing
alternative childcare options to children between 1 and 3 since the places in kindergartens were limited.
However, the aim of the initiative was also to create new jobs for the unemployed people registered in
Local Labour Offices. Therefore, overall, the initiative was conceived to:
Create new work places for unemployed people actively seeking work; Create conditions for easy transitions and women returning to work after their maternity leave; Guarantee a better balance between personal and professional life of new parents.
Two National Agencies are involved in the project: the NEA and the Agency for Social Support (ASS). The
NEA acts as both a contracting authority through its “European funds and international projects” (EFIP)
General Directorate and a beneficiary through its “Employment services” (ES) General Directorate. The ASS,
provides training for the unemployed people selected to participate in the programme and thus gives them
the opportunity to acquire new knowledge and skills and professional satisfaction on the labour market. An
agreement concerning the “Back to work” initiative between the two institutions (NEA and ASS) was
concluded on the 12th of March 2010.
The scheme is funded by the European Social Fund (ESF) and the Ministry of Labour and Social Policy. The
total budget is 32 million euro (85% ESF funding and 15% national resources), and activities are
implemented throughout Bulgaria. The project is planned to last 35 months (February 2010 – December
2012)11 and aims to train 8,500 people in child care and placed 8,000 people in jobs.
The main phases through which the “Back to work” project operates are the following (Figure 23):
1. Gathering applications both from parents and unemployed people. Local Labour Offices of NEA collect applications from both families interested in having someone to care for their children and unemployed
people interested to become carers.
2. Assessment of both types of applications. Local Labour Offices of NEA are also in charge of the
assessment and approval of the applications of both parents and unemployed people. Currently,
eligibility for jobseeker applicants is based on several criteria, such as registration as unemployed,
relevant mental and physical health status, legal clearance and declaration that the people wish to be
included in such activities. Priority is given to people with qualifications in education, social and health
services and unemployed people in preretirement age who need additional length of service to acquire
the right to retire. On the family side, at least one of the parents must be employed or self‐employed
when the application is submitted and at least one should be on parental leave. Parents should not
already be included in the national ’Supporting Motherhood’ programme, and the child cannot be
registered in child care centres or kindergartens. Priority is given to single parents, families with many
children, parents of children with disabilities, families in which one or both of the parents have
disabilities, and families whose monthly income is less than 2 average work salaries.
3. Directing suitable unemployed people to the approved parents. Local Labour Offices of NEA mediate
between successful unemployed applicants and approved families who need a carer.
4. Approval of the unemployed people by the parents. Parents have the right to choose the unemployed
person who will take care of their child.
11 The project started on the 25th of February 2010, but it continues the policy of the national funded program ‘Supporting Motherhood’ which started in 2006 and will be in place until 2012.
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European Job Mobility Laboratory, November 2011 45
5. Including the unemployed people in training. Approved unemployed people are then trained in key
competences, such as caring for young children, and are thus equipped to work with them. Beside
vocational training, motivational training is also provided. The NEA, as the managing authority of the
project, refers approved people in training organised by the ASS, which issues them with a participation
certificate at the end of the training period. The training lasts 1 month and costs the ASS 300 LEV per
person (about 200 Euros).
6. Including trained unemployed people in employment. The NEA is also in charge of allocating trained
people to jobs. In particular, it signs work contracts for the position of ’Child carer‘ for a period of 3 to
24 months and provides a minimal monthly salary and insurance to trained workers. Thus trained child
carers have contracts directly with the NEA. At the end of their contract period carers are included in a
list from which they can be selected for other jobs by families taking part in the project.
Figure 23 – Back to work project phases
Source: Bulgarian National Employment Agency
The NEA is in charge also of the monitoring of the quality of the child care activities and has implemented a
system through which representatives visit families taking part in the project once a month to verify that
the services are being provided satisfactorily.
The “Back to work” scheme is particularly attractive for women12 of pre‐retirement age, who have become
unemployed due to the restructuring of public health and education services as part of fiscal consolidation
measures undertaken by the state. Initially, pensioners or women of pre‐pension age were the first groups
to be involved in the scheme. Later, due to high demand, the scheme was expanded to include more target
groups and a broader eligibility. At the end of September 2011 the scheme included 1,416 families and
1,692 unemployed people who have been trained in childcare, of which 755 were aged over 55, as well as
77 instructors13. In total, 708 unemployed people over 55 were employed (1,426 people in total). The PES
regularly monitors the progress of the scheme and reports results to the NEA. At this stage, the scheme is
deemed to be relatively efficient with respect to its target and the use of funds.
Conclusions and lessons learned
12 So far just two approved carers are men, and they are both relatives of the children. 13 The number of civil contracts concluded so far by ASS for instructors is 169.
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Labour market activation and employment amongst older people in Bulgaria have increased greatly in the
last decade or so, however much more needs to be done. There are several national projects targeting
senior workers in Bulgaria, but additional initiatives are needed. Moreover, a system of co‐ordination of the
current and future initiatives is fundamental to activate a learning process and avoid duplications.
The ESF plays an important role in supporting such initiatives. Evidence from current programmes shows
that it is efficient to rely on ESF funding for projects that are generally short‐term and often operate on a
local basis. The success of the support provided depends also on the interests of the actors and their joint
efforts to design simple and flexible programmes. Partnerships between different actors with different
expertise are also key aspects in the policy design of these initiatives. The ‘Back to Work’ scheme is a
successful example also in this respect. Other interesting lessons can be drawn from this project. The
intergenerational support at the basis of the project is an important instrument to motivate senior workers,
facilitating their acceptance by employers (families) and favouring their re‐insertion in the labour market.
This approach can be replicated in other countries or in other sectors (for instance, handicraft). The training
component of the project appears fundamental to provide qualified and standardised services on the one
hand, and to motivate and empower older workers on the other. The ”Back to Work” scheme also helped
older workers to exit from the grey economy and can represent a starting point also for business creation in
the caring industry.
The good employment results of the project are largely dependent on direct public support for salary costs
and this can make it difficult to sustain in the longer term; the results and the final impact should be
verified at the conclusion of the project. However, for vulnerable groups, including older workers, it is
important to carefully consider the trade‐off between no occupation and occupation made possible
through public funds; in the case of vulnerable groups, the social value of the financial support is higher and
if temporary occupation can be associated with real activation and empowerment of the worker there may
be important positive effects for society as a whole.
3.2 France
The national context
The employment of older people is now absorbing considerable public attention in France and public
strategy towards senior workers is currently being revised. Getting more older workers to be active in the
labour market would not only help strengthen French economic performance, but reduce pressure on
pensions and public finances generally. As in many EU countries, France is facing the demographic
challenge of an ageing population, though it is less affected than many other EU countries as the active
population is not projected to start contracting before 2060.
In the last two decades or so the French government has begun to respond to the older workers issue.
Since the mid‐1990s, it has greatly restricted access to publicly funded early retirement schemes, after
having extensively resorted to such schemes in the past. More recently, France has ended the possibility for
older workers to claim unemployment benefits without any obligation to maintain any job search activity.
With early retirement options no longer available, unemployment benefits had become another way to
leave the labour market early. A series of decisive steps to encourage workers to remain active longer have
been taken since 2003 with successive reforms of pension schemes, with the most recent being in 2010. In
addition, a National Action Plan for the employment of senior workers was launched at the beginning of
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European Job Mobility Laboratory, November 2011 47
June 2006. This plan concludes a national intersectoral agreement established in October 2005 and aims to
improve employment opportunities and conditions for older workers. The plan of action, to be enforced
between 2006 and 2010, aimed to reach an employment rate of 50% among people aged from 55 to 64
years by its final year of application.
France also launched a campaign in 2008 l’expérience des plus de 50 ans which highlights the value and
qualities of senior workers. It is directed in particular at corporate executives and human resource
managers in order to raise their awareness of the added value senior workers can bring to the workplace.
Against the background of these various actions and policy developments, the employment rate of 55‐64‐
year‐old French workers increased from 29.4% in 2000 to 38.5% in 2005, and up to 39.7% in 2010
(Eurostat). However, despite an increase of just over 10 percentage points over the last 10 years, the
employment rate of French older workers is still a long way behind the level set by the National Action Plan,
and more than 6 percentage points lower than the EU‐27 average for 2010 (46.3%).
Throughout the economic crisis, as in many EU countries, the impact on senior workers in France has been
relatively mild compared to that on prime‐age workers. Indeed, the employment rate of people aged 55‐64
in France rose by 1.5 percentage points between 2008 and 2010, more than the increase for the EU as a
whole (0.7 pp)14. At the same time the employment rate of prime‐age workers fell by 1.6 pp compared to a
decline of 2.3 pp in the EU as a whole.
Measures to retain and (re‐)integrate older workers
The French public employment service, Pôle Emploi, considers all jobseekers aged above 50 to be senior
workers. Its mission is to work with senior jobseekers and companies and to work with relevant partners to
provide placement and guidance services for senior jobseekers. Pôle Emploi aims to increase the rate of
employment of people aged 55‐64 to reach the objective of 50 % (for 2010 and after), as well as to
encourage seniors to stay on the labour market longer and to increase the rate of sustainable employment
for older workers.
Actions of Pôle Emploi in favour of older worker takes account of the difficulties that older people face in
accessing paid employment once they lose their job. Barriers to re‐employment arise from several factors,
including negative personal perceptions and barriers posed by the labour market and employers. Among
the first category of barriers are: difficulties to accept loss of previous employment and working conditions,
difficulties to value skills and skills acquired through experience, a need for longer and more intensive
support to convince people that they have the capacity and motivation to start again and take‐up a new
career path. Barriers coming from the labour market and particularly from the employers include: strong
hesitations to recruit older workers, companies still in favour of schemes facilitating early leaving, wish to
rebalance their age pyramid, unwillingness to adapt working conditions in the workplace, salary level for
older workers 20 to 30 % higher than that of people aged 30‐39, lower level of training and unwillingness
to update qualifications and skills, in competition with young graduates on the labour market.
Pôle Emploi’s service offer for older workers includes the following:
Measures to encourage people to remain or return to employment;
Tailored counselling services;
14 Source: Eurostat, Labour Force Survey: lfsa_ergan
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Every older jobseeker has a personal counsellor from the first month of unemployment (younger
jobseekers only have a counsellor from the fourth month of unemployment). More intensive support is
provided by organisation of group activities – named “senior clubs” – targeted at supporting and
empowering older job seekers. The main objective of these clubs is to get older workers into a network
with other senior jobseekers, which visits companies in order to establish job opportunities.
Other tailored counselling services include:
- skill assessments;
- career guidance and access to training or retraining;
- post‐employment support.
Pôle Emploi offers also services targeting enterprises in order to encourage and promote the employment
of seniors. These include:
in work assessment, hiring simulation methods and initiatives to encourage alternative working forms
(i.e. new business start‐up);
age‐awareness communication plans, forums, and breakfast meetings with French companies; also
human resource clubs through which companies can exchange information on seniors including
organisation of quarterly meetings of national “Human Resources Clubs” with decision‐makers from
large companies.
Conclusions and lessons learned
The initiatives implemented by Pôle Emploi have so far had significant results in terms of the employability
and re‐employment of senior workers. Their first key factor for success is the provision of tailored services
that support older jobseekers from the first month of unemployment up to the post‐employment phase.
They also support alternative working forms, with actions targeting senior jobseekers who are willing to
start their own business.
Close cooperation with social partners and local businesses are also fundamental. Services for employers
include advisory services and consultancy to employers, particularly SMEs. Awareness‐raising activities and
training in age management are also essential to demonstrate the advantages of employing a senior
workers and thus convince employers to hire them.
In terms of future developments, breaking with the tendency for workers to make an early exit from the
labour market requires a multi‐dimensional strategy from Pôle Emploi that takes account also the
expectations of firms. This strategy, which will be subject to consultation with social partners, will be based
on:
the development of a career‐oriented culture, based on a wider career planning approach to help
develop people’s employability from the earliest age;
the engagement of employers on the improvement of working conditions, occupational health and the
wishes of workers about mobility and skills developments;
the recognition of senior workers’ experience and the maintenance of human capital as an asset for the
enterprise (also in order to identify and transfer know‐how to younger employees);
the revision of work organisation in order to foster cooperation between generations and develop
alternance for adult workers;
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European Job Mobility Laboratory, November 2011 49
the implementation of mechanisms enabling sharing of senior workers between several firms.
3.3 Germany
This case‐study focuses on the “Perspektive 50+” agenda, which has been implemented since 2005 to
support older workers in Germany.
The national context
In the last decade, the labour market for older workers has been subject to significant changes. In January
2005, labour market reform changed the unemployment assistance from a system based on a replacement
of past earnings to a system based on a sociocultural living wage, leaving older unemployed persons with a
long employment history worse off. The maximum duration of unemployment benefits was cut from 32
months to 18 months for older workers aged 57+. This change also affected early retirement schemes,
namely reducing the possibility to use unemployment benefits. Finally, in 2007 the official retirement age
was raised from 65 to 67 and in December 2009 subsidies for early retirement schemes expired.
Already in 2005, the scheme “Perspektive 50+” was launched in order to help older unemployed persons
cope with the new situation. Following the labour market reforms and the increase in retirement age there
was a serious public debate about the predicament faced by older workers who suffer a loss in transfers
and struggle to find work. As a result of this debate the duration of unemployment benefits for workers
aged 55 and older was increased to 24 months.
After the labour market reforms, the employment rate for workers aged 55 to 60 increased from 73.8% in
2006 to 77% in 2010. The increase was even more pronounced for workers aged 60 to 65 (from 33.2% to
44.2%) while the overall increase in the employment rate was much lower (74.9 to 76.5%) implying that
labour market reforms affected to some extent the labour market participation of older workers. The
increase was strong for both females (24.4 to 35.4%) and males aged 60 to 65 (42.3 to 53.4%), while for
males aged 55 to 60, the increase was smaller (82 to 84.4%) than for females (65.6 to 70.2%).
The figures for self‐employed workers follow a similar trend; in the period from 2006 to 2010 the number
of older self‐employed workers increased by 9% compared to a 2% increase for self‐employed workers of
all ages.
In addition, the demographic trend is steadily increasing the number of older workers. In 2006 the number
of older workers aged 55 to 65 was 9.4 million but in 2010 it has risen to 9.8 million.
The labour market conditions for older worker are slightly worse than for the average worker. In March
2011 the unemployment rate was 9.4% for older workers and 7.6% for the average worker reflecting the
fact that older workers have difficulties in finding a job having been laid off. Given this reality, the scheme
“Perspektive 50+” is designed to help older long‐term unemployed to get work
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European Job Mobility Laboratory, November 2011 50
Measures to retain and (re‐)integrate older workers
“Perspektive 50+” was launched in 2005 by the ministry of labour and social affairs (BMAS) and is now in its
third phase. During the course of the scheme it has undergone two significant changes. Firstly, the target
group shifted from older unemployed persons in general and disabled persons, to long‐term unemployed
persons only. Secondly, the project was expanded so that more than 95% of Germany’s job centres are now
participating, up from halve that number in the second phase of the scheme.
The scheme has been implemented through the formation of a large number of regional committees
“Beschäftigungspakte” which bring together key labour market actors (the federal employment agency,
social partners, the chambers of industry and commerce, the health insurance body, regional
unemployment associations, churches and other religious groups as well as welfare organizations). The
partners involved in the employment pact have to guarantee the functioning of several basic tasks, the
coordination of the pact, financial management, public relations and the maintenance of the programme
database. The size and the geographic area of the employment pact should follow the needs of the regional
labour market structure with one employment pact for every regional labour market15.
Table 17 ‐ Actors and tasks of the project
Actor Task
Job‐centre (Federal employment agency) Organisation of the pact, providing services, financial coordination, co‐
funding
Job‐centre (municipality) Organization of the pact, providing services, financial coordination, co‐
funding
Social partners
(e.g. unions, employer organisations etc.)
Supervision of the PES, employment agreements (e.g. combined wages,
integration allowances)
Chambers of industry and commerce Provision of further education
Health insurance Provision of health‐related services
Regional unemployment associations Pact member
Churches and other religious groups Pact member
Welfare organisations Services related to challenged persons
Source: Own elaboration
The tasks of each employment pact were defined in autumn 2010 with the agencies of basic social care
(e.g. job centres) and BMAS, based on the particular application of each agency. In general, the target
agreements should guarantee the achievement of the objectives according to three criteria: a defined
number of participants in programmes, the activation of a defined number of participants and the
integration of a defined number of participants into the labour market.
The objective of a defined number of participants in programmes is an input criterion. Every participant in a
programme who is the target of activation or integration measures contributes to the success of this
criterion. The activation objective is defined as an input criterion as well. The participant is counted as
activated when he or she has participated in a programme which intends to increase his or her personal
responsibility or which intends to enhanced the ability of the participant to find a job. The integration
objective, on the other hand, is an output criterion. The number of participants successfully integrated into
15 A regional labour market is defined as a geographic area with perfect labour mobility and should include more than one job centre.
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the labour market as an employee or as a self‐employed worker for a period lasting at least six (continuous)
months, count towards this criterion. Depending on the above criteria, a budget for the pact is provided.
There are three financing model options for the employment pacts. One of the first two models has to be
chosen, while the third model is an add‐on and can be chosen in addition the other models. The first model
involves 500 euros per activation, 2,500 euros per integration longer than six months and 1,500 euros for
each integration less than six months. The second model involves nothing for an activation, but 5,000 euros
per integration into the labour market for more than six months and 3,000 euros for less than six months.
The third model is intended for socially deprived participants. For this specific target group, BMAS pays
1,500 euros per activation, 5,000 euros per integration for more than six months and 3,000 euros for
participation of less than six months. However, the financial resources received from the project do not
cover all of the projects expenses. The basic social care agencies are expected to use a part of their own
funds to supplement the scheme. The legal basis of this co‐funding is § 16f SGB II.
The services provided to older workers are either co‐financed by the basic social care agencies or financed
entirely by the ministry. All services provided fit into the service scheme of the federal employment agency.
From the start of the third phase of the scheme in 2010 until June 2011 the number of participants in co‐
financed services steadily increased to more than 44,000 each month. These services can be split into three
groups: services to improve chances on the labour market, job accompanying services which are foremost
employer’s integration allowances and finally, job creation schemes16. In 2008‐2009 services to improve
prospects on the labour market were most common, making up more than 50% of the other services
provided to older unemployed persons. In the aftermath of the financial crisis these services dropped to a
28% low in January 2011 but have since been rising. Since November 2010 job creation schemes have
clearly dominated and in January and February 2011 they made up over 40% of services. However, their
share is falling steadily and was 37% in June 2011, reflecting the strong recovery in Germany. Job
accompanying services, on the other hand, have remained at roughly 20% throughout the whole project
period.
Most participants receive services intended to activate and integrate older workers into the labour market
initially. These services are intended to discover skills and placement restraints in the first instance and
then to eliminate placement restraints. Most of these services are tendered to private agencies. In April
2011 nearly 9,400 older workers participating in the programme received one of these services. Within this
group of activation and integration services 2,400 older workers were placed in schemes; 1600 received
activation services like job application training and 600 received services to eliminate placement restraints.
However, if one worker receives more than one service, he or she is counted in a separate group
(containing 3,100 participants). Only 44 participants received services to help them enter self‐employment,
and 1,000 received services of further vocational training. In the group of job creation schemes, services
which pay only an expenses allowance on top of the unemployment benefit dominated ‐ with 3,400
workers participating in these schemes.
Besides the services within the programme database of the BA, 18,000 older workers receive services
covered solely by the “Perspektive 50+” scheme. These services are foremost health services, integration
16 The job creation schemes are to a large extent jobs with expenses allowances “Arbeitsgelegenheiten mit Mehraufwandsentschädigung” according to §16d SGB II. These jobs are created at the municipality level and have to be additional and socially useful. The duration of the job should be between 3 and 12 months, the goal of this service is to increase the employability of the participant.
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allowance for workers who are not likely able to find a job in the next 24 months and combined wages
which cover losses (e.g. pension scheme related) which occur due to the acceptance of a low‐paid job offer.
The University Duisburg‐Essen won the tender for the evaluation of the “Perspektive 50+” scheme. The
researchers found that 18% of activated older workers were integrated into the labour market. Out of
these, the share of participants with employer’s allowances was 39%. However, the project was not
finished at the time of evaluation. If only participants who left one of the programmes are considered, the
labour market integration was 34.5%. The researchers observed huge variation in success; some of the
regional committees “Beschäftigungs Pakt” integrated 700 older workers which was more than ten times
the integration of the worst performing committees. Most of the older workers got a job in their previous
occupational sector, 20% had to choose an occupation below their formal qualification and another 20%
found an occupation better than their last job (Büttner, et al., 2009).
Conclusions and lessons learned
“Perspektive 50+” set out to integrate older long‐term unemployed persons into the job market. Roughly
one third of the target group were integrated, and thus the scheme is considered to have been a success.
Most integration took place in small and medium sized enterprises. The close connection between the
partners of the employment pact and those companies seems to have been crucial to the success of the
project. However, the financial and economic crisis reduced the efficiency of the scheme, which is reflected
by the strong increase in job creation schemes.
The specific target group of the project was older long‐term unemployed with serious placement restraints.
In most cases the last employment was more than four years ago and participants suffered serious health
problems making the placement more difficult. The interrelation between lifestyle and health problems
was a specific issue within the project. The partnership between the BA and the health insurance
companies made it possible to activate participants, giving them help in leading a healthier life.
Obstacles to mobility were a serious barrier to the success of the project. In rural areas there is a lack of
public transportation and older workers without a driving license are unable to travel to a working place in
the environs of their place of living. The project has no clear strategy for the activation of those people
since the basic living allowance barely covers the costs of a car. Furthermore, participation in driving
schools is not a quick‐fix, it can take time to pass and be able to drive confidently. The Institute for
employment and qualification also reported that knowledge of the legal framework was not up to
standards in all job centres. In some cases there could be more services provided to the target group than
are currently in place.
The provision of specific services to older long‐term unemployed is a necessity in an aging society and the
provision of services related to health issues is in most cases crucial for the activation of the target group.
Accordingly, the job‐centres face new challenges in the upcoming years. Older people face specific
problems, like obstacles to mobility; here the programmes need further development to match the needs
of older people. Additionally, new services for older people which were developed during the last years like
special forms of combined wages have to be implemented as regular services. This inter alia demands
further training of placement officers. In sum, the scheme “Perspektive 50+” is an important step towards
serving the needs of older unemployed. Nevertheless, there seems to be a way ahead till the scheme gets
obsolete and the need for new programs for older workers diminishes.
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3.4 Netherlands
The national context
An ageing population is one of the top challenges faced by European economies. As the baby‐boom
generation reaches retirement there will be fewer workers for each pensioner and so, a greater strain on
funding. The Netherlands are one of the EU’s more stable economies and, for many, a model of sound
policymaking. Yet even for the Dutch the ageing issue is proving difficult to tackle. In fact, as in many EU
countries, people aged 55‐64 in the Netherlands currently represent approximately a fifth of the whole
working age population (those aged 15‐64) (Eurostat data for 2010) and their weight is projected to
increase up to 2025‐2030.
However, the Netherlands has successfully undertaken major social security and labour market reforms in
recent years, and current Dutch employment performances for older workers are significantly better than
most EU countries. Over the last 10 years or so, the Netherlands has been able to start reversing the early
retirement trend and improving employment at end of career. The basic principles of the government’s
efforts were as follows:
To make it easier and more attractive for people to stay in work longer (i.e. favouring flexible working
patterns);
To avoid a forced early shift into inactivity (via retirement, unemployment or disability schemes)
wherever possible;
To make early retirement schemes disadvantageous. Voluntary early retirement has remained an
option, but its costs are to be borne individually rather than collectively;
To encourage reintegration into the labour market.
Major reforms were initiated around 1995 and accelerated under the second Kok government (1998‐2002).
To keep the pension scheme affordable and meet the rising costs of care, the Dutch government set,
among others, the target of an annual rise of 0.75 of a percentage point in the net participation rate of
people aged 55‐64 years from 1999 onwards. More recently, in response to the crisis, the Dutch cabinet
confirmed its commitment to the goal of higher labour participation, excluding any measures aiming to
reduce labour supply as counterproductive over the longer term. As the economic crisis has caused
considerable concerns over the ageing population issue and the sustainability of the pension system, a new
set of policy initiatives has been launched since 2009:
the government announced its decision to postpone the age of the retirement from 65 to 6717;
older individual employees who continue working until the age of 65 and beyond have started to
benefit from a “longer working bonus”, while those working beyond 57 have received a higher tax
credit for working longer;
unemployed older workers who return to work have been guaranteed a wage that is higher than their
previous social benefit;
fiscal bonuses have been introduced for employers who recruit unemployed adults over 50 or who
continue to employ workers aged 62‐65; recruiting unemployed individuals over 59 is subsidized up to
the age of 6518.
17All those aged 55 or over in January 2010 retained the right to their old age pension at 65, while the change will take place in the
near future in two phases: in 2020 to 66, and in 2025 to 67. 18In cases where individuals become sick, the government compensates the employer for the costs involved.
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Unlike the majority of the EU Member States, the Netherlands has put a stronger emphasis on training and
labour supply measures within anti‐crisis measures. In 2009 the original focus on the structural non‐
participation of older workers has been increasingly broadened towards an integral policy perspective on
sustainable employability throughout the individual life course. In particular, in December 2009, the
Ministry of Social Affairs and Employment submitted a policy memorandum on Labour Market Participation
of Older Workers to the Dutch parliament. This memorandum announced that the cabinet wished to create
a climate for investing in the productivity, employability and mobility of workers so that they can utilise
their talents and possibilities also in later life. Three key areas for policy development are identified:
education and training, age‐awareness personnel strategies in companies, and the development of
instruments for preventive interventions.
As a result of the mentioned policy changes, the employment rate of 55‐64 year‐old Dutch workers
increased from 28.8% in 1995 to 53.7% in 2010 (64.5% for men and 42.8% for women) and the average exit
age from the labour force rose from around 60 in 1995 to 63.5 in 2009 (Eurostat), the second highest in
Europe after Sweden (64.3 years)19. Also, throughout the economic crisis, the Netherlands has been cited
among countries where the impact on employment and unemployment rates has been relatively mild. Over
the crisis period the employment rate of people aged 55‐64 for the EU‐27 as a whole continued to increase
but Dutch older workers performed better than average. In spite of this, the employment of senior workers
still represents a significant problem. In 2010 there were 122,000 registered non‐employed jobseekers
aged 55‐64, representing more than 20% of all registered non‐employed jobseekers (up from about 15% in
2001), while in the same year their share in all PES vacancy placements was just 2‐3%. Moreover, as is the
case across Europe, problems for older workers arise once they become unemployed or inactive. The
average duration of unemployment for people over 55 is 3 years. To the same extent, the probability that a
55‐year‐old jobseeker on unemployment benefit re‐enters work one year later is 10%, reduced to 3% for a
person aged over 6020.
Measures to retain and (re‐)integrate older workers
The Dutch PES (Uitvoeringsinstituutvoor Werknemersverzekeringen, UWV) strategy towards older workers
is based on the following pillars:
1. Continuing to break down prejudices towards older workers;
2. Encouraging face‐to‐face meetings between elderly unemployed and employers;
3. Developing network groups at local offices to support employability of older workers;
4. Encouraging mobility within and outside organizations;
5. Focusing more on talent and less on age;
6. Using more skills assessment systems, with special assessment for people aged 55+ and
long‐term unemployed;
7. More use of EVC and EVP (certificates of acquired skills and competences);
8. Encouraging use of social media also among senior workers;
9. Cooperating with private partners.
UWV has been playing a proactive role in countering the effects of the economic crisis on older workers. In
order to maintain work. During the crisis UWV implemented the “Mobility Centres (job‐to‐job)” project that
19 Also not policy driven spontaneous factors are at play, such as: the rather recent increase in female participation that now reaches the higher age groups and the increased level of educational attainment (higher level correlates with higher participation ratio’s) 20Source: http://www.wapes.org/infos/file/attachfiles/pdf/2011‐136‐EN.pdf ‐
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intended to provide jobs to redundant workers before they became unemployed. This initiative had 31,000
placements overall, of which 60% were for people aged 45 years or more. After the crisis the project ended
but the service has been implemented as part of the regular UWV service offer.
The UWV has initiated two programmes that focus on older workers as main target21. The first project was
called “Talent 45+” and it aimed to promote the labour market participation of jobseekers aged 45‐63.
“Talent 45+” started in January 2007 and ended in 2010. The budget of the project was 9 million euros and
it was funded by the Ministry of Social Affairs and Employment (SZW). UWV acted as the main responsible
organisation, but several actors were involved in the realisation of the project: temporary agencies,
municipalities, employers as well as trade unions. In 2010, the project managed to support more than
75,000 people aged 45 and more back into work (up from 68,000 in 2007). In addition, over the four year
period of implementation about 286,000 unemployed people 45+ were supported back to business (against
a planned target of about 168,000 people).
The second more recent project is called “ESF Talent 55+”, which aims to promote labour participation of
jobseekers aged 55‐60, mainly bringing older unemployed people into contact with each other, so that they
can use each other’s networks to find work. The project was set up at the beginning of 2009 and
commenced activities in October 2010. It has a total budget of 2.2 million euros, of which 40% is funded by
the ESF and the remaining share directly by UWV. For this project UWV Werkbedrijf has trained 26
dedicated coaches whose main activity is to keep the unemployed 55+ workers fit for the labour market
and to find a job by using each other’s network. People meet at a job centre and discuss various topics. The
job centre acts as a facilitator (they can use job‐centre rooms, meeting facilities, computers, coffee, etc.).
The result is that 18% of the participants found work within 10 weeks. The others form a new network
group with the new influx of participants.
As far as the working method is concerned, dedicated work coaches organise these network activities for a
13‐week period; principally these activities focus on:
how to present oneself, including so‐called “elevator pitch”, that is to produce a quick, succinct but
convincing statement of personal skills, talents and ambitions;
how to use social media;
how to draw up a good CV and how to write an application letter;
how to deal with a job interview;
how to look for suitable jobs or even start a business.
Beside these 55+ network groups, the following services are also offered by the project:
swot‐analysis of personal skills to plan how to approach the labour market efficiently;
use of competence tests and earlier acquired skills certificate, to test also people’s motivation;
labour market reintegration instruments (i.e. subsidies for employers to encourage them to hire older
people – subsidies are up to 6,500 euros per year, for a maximum of three years)22;
targeted canvassing of employers, through which UWV approaches employers that may have special
vacancies for elderly workers;
research and utilisation of available subsidy opportunities;
organisation of specific job fairs and speed dating.
21 Disabled people are also eligible to take part in the project.
22 Although no budget for reintegration instruments has been allocated for the year 2012.
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The project has a particular approach towards participants, since they are categorised according to their
level of education in order to provide tailored measures for both the lower and the higher educated.
Providing a more specific and specialised service for each participant means obtaining better results, as it
deals with personal skills and attitudes.
The project aims also at promoting a positive self‐image of senior jobseekers and changing the negative
image that employers have of them (in particular supporting a focus on talent rather than old age). This
occurs mainly through a nationwide advertising campaign and a series of meetings and workshops between
employers who offer vacancies and the target group. So, the exchange of information is favoured, in order
to improve the matching between demand and supply in the labour market.
Twelve months from the start of the project, the results of the “ESF Talent 55+” project are as follows :
3,978 older unemployed 55+ workers have taken part in the network groups, 1,364 have found a job and
85 started their own businesses. Thus, more than 33 % of the over 55s involved in the project have found a
job23, compared to a success rate of 10% for “normal” UWV services24. In the future, UWV intends to
involve a total of 10,000 older workers in the project.
Conclusions and lessons learned
The “ESF Talent 55+” project has so far had significant results, since approximately one in three jobseekers
found a job within six months. A key aspect of the project is the provision of specialised work coaches who
help jobseekers from each specific target group to improve their skills. Work coaches who really like to
work with the older worker target group are a crucial factor for the success of the “ESF Talent 55+” project.
Indeed, given the positive results achieved, it has been decided to expand the number of coaches from the
initial 26 to 55 and up to 180 for the following years.
Other important elements for the success of both projects (“Talent 45+” and “ESF Talent 55+”) are:
the cooperation and action of all parties involved both on the labour supply and labour demand sides
(temporary agencies, municipalities, employers as well as trade unions).
the involvement of employers: the labour market demand side needs to be stimulated. One example is
the organisation of campaigns for employers to tackle the prejudices they held towards elderly
jobseekers (i.e. lack of flexibility, regular sickness, etc.). While participating in workshops/job fairs,
where role models and best practices are presented, employers might convince each other to hire
senior persons.
the offer of special programmes targeting senior jobseekers who are willing to start their own
businesses (i.e. special competences tests, workshops, etc.).
adequate support from policy makers.
an adequate budget and a booming economy is certainly is helpful.
23 More than 30% of the total found a job within 6 months. 24 For 2011 UWV targets for older workers to achieve through normal services are:
Offer 5,720 sustainable jobs to older jobseekers;
500 jobseekers to find paid employment;
and 30 jobseekers to become self‐employed.
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3.5 Poland
The Polish experience focuses on the “Mature Entrepreneur” project implemented between 2009 and
2010.
The national context
Senior workers aged over 50 in Poland are in a very particular situation in the labour market. According to
the Central Statistical Office, in 2009 and 2010, they made up about 40% of the whole working age
population. They also have the lowest activity rate within the EU‐27 area (except for Malta), currently
around 32% (2010) with an extremely low employment rate among women (24.4%) and 41% among men,
but, at the same time, the unemployment rate is very low: 6.3%. This may be due to the fact that they de‐
activate early and are often not registered with the PES as unemployed.
In 1990, with the economic transition and the reduction in the number of jobs in large‐scale production
companies, workers over 50 were incentivised to use early retirement benefits, based on specific bridging,
early retirement schemes. In mid 2000, the average retirement age in Poland was 57.9 for men and 56 for
women.
Subsequent governments, instead of developing and establishing a set of retraining programmes for people
over 50 to match their qualifications with the needs of the contemporary labour market, sustained and
stabilised this practice of early deactivation. This resulted in the transfer of about 30% of early pensioners
aged over 50 to the grey economy (Mol, 2008). Some research also confirmed that people aged 50 or over
in many cases apply “a strategy of inactivity” and obtaining a benefit (early retirement, pension, or
disability benefit) is socially perceived as a “labour market success”. Such attitudes in the labour market
towards the older workers were reinforced by: legal settings and incentives, early work burnout due to lack
of age management policy in companies they worked for during their working life (especially during
Communism), deteriorating health conditions, and low financial means (Academy for Philanthropy
Development, 2007). On the other hand, when, in 2009, the Central Statistical Office asked people aged 50
or over if they wanted to deactivate early, one third stated that they wanted to work as long as possible.
In many surveys (Academy for Philanthropy Development, 2007; Manpower, 2009; Kozubska, 2008)
employers declare that age is not a relevant factor when choosing a new employee. However, older
workers and labour market institutions have in practive observed some degree of age discrimination in the
labour market.
In relation to the national policy context in Poland, it is worthwhile mentioning that when it comes to
dealing with senior workers (50+), all undertakings and actions mirror the Polish PES business model which
means administrative decentralisation of competences and activities into regional (NUTS 2) and very local
levels (NUTS 3). This means that there is nearly no legal space for national coordination of any day‐to‐day
businesses and practices as they are mainly conducted by regional and local labour offices who are
financially dependent on local governments. The Ministry of Labour and Social Policy can facilitate and
enhance initiatives and actions addressed to any group in the labour market by special ministerial
programmes. In the case of senior workers in Poland the programme Solidarity of generations, Actions to
increase employment activity of 50+ was conducted from 2008 to 2010. The instruments of such
programmes are mainly related to legal developments: new acts and regulations and special budgetary
lines for regional and local initiatives. In the case of the programme Solidarity of generations nine legislative
tasks were completed, in relation to: releasing employers from special payments to Work Fund and Fund of
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Guaranteed Workers’ Benefits when employing 50+; facilitating training to upgrade skills for 50+; limiting
the number of special occupational groups authorised to access early retirements schemes; creating legal
conditions for grandparents to be able to take care of their grandchildren without stopping their
occupational lives (life‐wide learning). The programme created also innovative initiatives addressed to 50+
such as E‐learning for 50+ and Skill Centre 50+ within life‐long learning process. The programme Solidarity
of generations was cross‐public administration programme in a sense that the Ministry of Labour and Social
Policy invited other ministries to actively participate: ministries of education, health, regional policy,
agriculture, and governmental agencies of human resourses development and enterprise development but
also local governments and regional and local labour offices.
Measures to retain and (re‐)integrate older workers
The local PES in Gdansk (North of Poland) conducted a project called “Mature Entrepreneur” from 1st
January 2009 to 31st December 2010. The basic aim of the programme was to prepare (via advanced,
detailed training and individual coaching) a selected group of people over 50 to run their own business for a
minimum period of 12 months, with the help of the subsidy given by the labour office. The project had four
phases: (1) an information campaign to enhance recruitment and selection processes; (2) advanced training
and coaching (counselling) for some selected older workers; (3) the setting up of business plans prepared as
a result of training and counselling and subsidising selected business plans; (4) the monitoring of the
implementation of business plans, and further coaching and monitoring the survival of the business in the
market.
The project was addressed to senior workers aged 50‐64, divided in three labour market groups in the
Poviat of Gdansk (NUTS 3): (1) unemployed senior workers aged 50 or over registered with local PES
(target: 20 people); (2) inactive older workers never registered with PES (target 20 people); (3) employed
and active senior workers wanting to change something in their occupational lives (target 20 people). One
of the most effective novelties of this project was a number of media campaigns (newspapers, TV, internet)
in order to enhance the recruitment processes/channels. They were addressed to those beyond the reach
of PES, to passive older workers, to those not registered with labour offices and also (but to a lesser extent)
those who wanted to change the course of their working lives. The campaign brought 120 people ‘from the
street’ into the programme, as well as people, aged 50 or over, who were already registered with local
labour offices at the time of the project. In the end, 60 people were selected in the three above mentioned
categories.
The principal provider of the project was the local labour office in Gdansk. The partners of the programme
were: Gdansk Employers Associations (Gdanski Zwiazek Pracodawcow); the Regional Chamber of
Commerce of Pomerania (Regionalna Izaba Gospodarcza Pomorza); the Pomeranian Chamber of Craft of
Small and Medium Enterprises (Pomorska Izba Rzemieslnicza Malych i Srednich Przedsiebiorstw). The local
TV station was playing a contractor role, rather than being a partner of the programme. Partners of the
programme were acting as experts in advising local PES on the selection procedures, and on drawing up
business plans eligible for start‐up subsidies.
“Mature Entrepreneur” was funded by the European Social Fund along with minor input from the Labour
Fund of the Minister of Labour and Social Policy, with a total budget of just under 2 million PLN (around 0.5
million euro). The budget involved categories of: (1) information and promotion campaign (mostly based on
contracts with local national TV stations); (2) an advanced entrepreneurship group training, called ‘ABC of
business’, for 60 people; training measures were conducted by external specialists and individual coaching
(in the homes of the participants) with the main aim of preparing business plans for further competition in
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the next stage of the programme25; (3) a 10,000 euro subsidy for all the 26 winners of the business plan
competition26; (4) extra bridging money for 13 beneficiaries (in a salary form) of 1,200 PLN (300 euro).
The project has not been systematically evaluated ex‐post. The only means of evaluation was an on‐going
monitoring of: (1) the carrying out of business plan obligations such as: the purchase of the declared
equipment, all the necessary investments in properties or of further training measures and (2) a survival of
subsidised activities over a twelve month period. In conclusion, all subsidised activities lasted for at least
twelve months and fulfilled the obligations declared in the business plans.
Conclusions and lessons learned
Main results and challenges emerging from the project can be summarized as follows:
An open recruitment process with the support of TV campaigns attracted people who were passive in
the labour market or otherwise unreachable, as they had never registered as unemployed at labour
offices or had other financial resources such as: a pension or disability benefits or a working partner
(either in Poland or abroad) or supplied their services in a grey segment of the economy. The project
counteracted the “strategy of passiveness on purpose” and helped the over fifties in the labour market
to “come out of the shadow economy”. TV campaigns and other programmes documenting the work of
beneficiaries not only helped to promote economic activity among senior workers, but also helped to
break some of the negative stereotypes about the impossibility of this group to change their lives (“that
it is not too late, it is never too late”27). Some TV programmes were also a kind of “public surveillance”,
public monitoring of public money and helped to enhance the responsibility among society members.
The project gave also an opportunity to those already employed but not satisfied with their current
jobs (“stuck in the same jobs for ages”) or to those who found themselves in deteriorating conditions,
either as a result of further restructuring of the Polish industry or as a result of the economic crisis.
Addressing the project to “an open audience” of older workers brought the labour office a clientele
with a much higher and richer human capital, with better prospects for being reintegrated into the
labour market long‐term.
The size of the financial subsidy determines the size of the company to be set up by older workers.
Small subsidies usually bring single‐person companies (micro company). Therefore PES cannot expect a
big increase in employment.
The lack of a systematic evaluation of the project is a serious disadvantage. It will certainly limit the
learning process.
25 As declared by PES coordinator of the project and in project participant interviews, training and individual counselling were far more advanced, detailed, and better prepared than those offered by PES in a standard form. 26 Beneficiaries commenced their business activities in few categories, usually filling the niches in the market for “petty services” that big companies have no financial interest in supplying: (1) standard construction services such as: advanced energy auditing, house maintenance via small handy‐man type works; (2) financial services based on the financial education of clients; (3) psychological support centre for children and teenagers; (4) tourist services such as Internet Bureau of Tourist Information; (5) artistic services: puppet theatre; glass studio; (5) cosmetic services with tranquility therapy in a garden; (6) mechanical services such as car mechanic surveying on the spot; ecological car wash; (7) innovative services such as surveying the quality of water (thermo diagnosis, thermo vision). 27 A subsidy recipient said in an in‐depth interview that even if she did not receive the subsidy, after all this advanced training and individual coaching, she would set up her own business.
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3.6 Overview of employment subsidies in favour of older workers around Europe
This section focuses on the provision of employment subsidies that aim to incentivise the recruitment of
older workers or to maintain their jobs. In subsidized employment the earnings are provided by an
employer who receives a subsidy for the creation and maintenance of the employment position. Although
employment subsidies and passive labour market tools are beyond the scope of this study, given their
relevance in Europe, they must be mentioned briefly. The frequency with which employment subsidies are
used in the EU suggests that EU policy makers acknowledge that labour market demand plays a relevant
role in the issue of older workers. The table below summarizes the main employment subsidies targeting
exclusively the over 50s, across Europe. 7 EU countries have employment subsidies specifically for senior
workers.
Table 18 ‐ Employment subsidies exclusively for the over 50s, selected EU Member States, 2009
Country Intervention name Eligibility Type of subsidy Planned
duration
Year of
start
BE Back‐to‐work bonus for
people aged 50+ (FED)
Registered unemployed
50+ with at least 20 years
of work and eligible to UB.
Additional income paid to
workers going back to work.
12 months
(typical)
2002
Back‐to‐work bonus 50+
(FR)
Registered jobseekers
50+.
Wage subsidy paid to employers
(up to 12,000 euro per year) in
the Flemish region.
1 year
(max)
2006
BG Incentives for employers
to hire older unemployed
Old registered
unemployed (women 50+
and men 55+).
Incentives for employers:
contribution to wages, social
contributions, annual leave pay.
1 year
(max)
2002
Support in retirement
Registered unemployed
having <5 years to reach
the legal retirement age.
Incentives for employers:
contribution to wages, social
contributions, annual leave pay.
12 months
(typical)
2003
DK Servicejobs
Recipients of UB aged 49+
and in unemployment for
6 months.
Incentives for employers:
annual contribution to the total
salary of old LTU.
:
1999
Seniorjob
Registered unemployed
55+ and having worked at
least 25 years in the last
30 years.
Incentives for municipalities:
periodic cash payments.
10 years
(max)
2009
DE Wage protection for older
employees
Unemployed aged 49+.
Incentives for employees: wage
subsidy plus supplementary
contributions to the old‐age
pension insurance.
2 years
(max)
2003
Integration voucher Unemployed aged over
50.
Integration voucher paid to
employers.
1 year
(max)
2008
AT Bonus/malus system
within the scope of
unemployment insurance
Unemployed over 50 +
employees over 50 with at
least 10 years in the same
enterprise.
Exemption of employers'
unemployment insurance
contributions.
Not
defined
1996
RO Subsidies for unemployed
approaching pension age
Unemployed having <3
years to reach the
retirement age.
Employers receive a monthly
subsidy equivalent to the
minimum wage.
3 years
(max)
2004
SI Promotion of
employment for older
unemployed persons
Unemployed aged 50+. Lump‐sum subsidy paid to
employers.
1 year
(max)
2008
Source: Eurostat, Labour Market Policy (LMP) database, data extracted on 28/07/2011
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The next table looks at the employment subsidies targeting also people over 50. Matching the information
in the two tables it becomes clear that 20 EU countries had in 2009 wage/employment subsidies to support
senior workers’ employment.
Table 19 ‐ Employment subsidies targeting also the over 50s, selected EU Member States, 2009
Country Intervention name Eligibility Type of subsidy Planned
duration
Year of
start
BE Transition‐to‐work
subsidy (BCR)
Low‐qualified jobseekers
(incl. unemployed 45+).
Monthly grant (up to 500
euro) paid to employers.
12 months
(typical)
1994
Activa (FED)
Registered jobseekers
(incl. unemployed 45+).
Reduced social contributions
for employers + monthly
allowance for employees.
63 months
(max)
2002
Insertion enterprises
(FR)
Disadvantaged
jobseekers (incl. 50+ in
inactivity for at least 6
months).
Degressive wage subsidies for
employers.
2 years
(max)
1999
DK Practical work training in
enterprises
Hard‐to‐place
unemployed (incl.
unemployed 60+).
Periodic cash payments to
individuals.
26 weeks
(max)
1994
DE Integration subsidies Unemployed facing
difficulty to find a job
(incl. those aged over
50).
Wage cost subsidies for
employers.
3 years
(max)
1998
EE Wage subsidy Registered unemployed
considered as risk
groups (incl. persons
having <5 years to reach
the pension age).
Wage subsidy for employers
(first 6 months: minimum
income; last 6 months: half of
the minimum income).
1 year
(max)
1995
ES Incentives for open
ended employment
contracts
Specific categories of
unemployed (incl. those
aged over 45 registered
as jobseekers for 12
months in the last 18
months).
Reductions of social security
contributions for employers.
2 years
(typical)
1997
Incentives for open
ended employment
contracts (measure ES‐
11 regions)
Specific categories of
unemployed (incl. those
aged over 45 registered
as jobseekers for 12
months in the last 18
months).
Reductions of social security
contributions for employers.
2 years
(typical)
1997
Employment support Priority groups (incl.
workers aged over 60).
Reductions of social security
contributions for employers.
: 2005
Employment support
(measure ES‐59 regions)
Priority groups (incl.
workers aged over 60).
Reductions of social security
contributions for employers.
: 2005
FR Employment‐initiative
contract (CIE)
LTU and other priority
groups (incl. jobseekers
aged over 50).
Incentives for employers:
monthly subsidy + reduction
of social contributions.
2 years
(max)
1995
Professionalisation
contract
Jobseekers (incl. those
aged 45+).
Incentives for employers:
exemption of social security
contributions (up to the
minimum income level) +
lump‐sum payments.
2 years
(max)
2004
Employment‐initiative
contract
LTU and other priority
groups (incl. jobseekers
Monthly grant paid to
employers.
2 years
(max)
2005
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 62
Country Intervention name Eligibility Type of subsidy Planned
duration
Year of
start
(CIE‐PCS) aged over 50).
CY Promotion of flexible
forms of employment
Unemployed women
(incl. those aged over
50).
Incentives for employers:
50% of the labour cost (salary
+ social contributions). The
unemployed also receive
some money to cover
travelling expenses.
1 year
(max)
2007
LV Subsidised employment
for unemployed
Registered unemployed
(incl. those having <5
years to reach the state
pension age).
Incentives for employers:
monthly subsidy (up to 50%
of the minimum wage)+
lump‐sum payments (to
adjust the work place for
disabled people).
2 years
(max)
2007
Measure for special
target groups
Registered unemployed
(incl. those over 50).
Incentives for employers:
monthly wage subsidy (for
the unemployed and the
mentor) + lump‐sum amount
for the purchase of
equipment.
2 years
(max)
2008
LT Support of social
enterprises
Inactive people (incl.
pre‐pension aged
people).
Incentives for employers:
partial compensation for
wage fund contributions and
social insurance premiums,
earmarked subsidies for the
establishment of a work place
or its adaptation to a disabled
person; subsidies to train
employees belonging to the
target groups.
Not
defined
2004
Subsidised employment Registered unemployed
(incl. persons over 50
capable of work).
Monthly wage subsidy for
employers (up to the
minimum income level).
12 months
(typical)
2006
LU Aid for employing long‐
term and older
unemployed
Registered unemployed
(incl. those aged 45+).
Reimbursement of
employers’ social
contributions.
2 years
(typical)
1993
HU Start extra LTU (incl. those over 50). Reduced social contributions
for employers (1st year: total
exemption; 2nd year: the
contribution is 10% of the
gross salary).
2 years
(max)
:
MT Gozo employment aid
programme
Unemployed in Gozo
(incl. those aged over
50).
A lump‐sum subsidy
equivalent to half the wage
and half the National
Insurance is given to
employers.
One‐off 2007
Employment aid scheme Unemployed (incl. those
aged over 50).
Employers receive a grant
equivalent to 50% of the
wage costs.
26 weeks
(typical)
2009
AT Integration subsidy (EB) Specific categories of
unemployed (incl. those
aged over 50).
Wage‐cost subsidies for
employers.
3 years
(max)
1994
PL Interventional jobs Registered unemployed
(incl. those over 50).
Incentives for employers:
partial reimbursements of the
wage costs, bonuses and
4 years
(max)
1990
THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES
European Job Mobility Laboratory, November 2011 63
Country Intervention name Eligibility Type of subsidy Planned
duration
Year of
start
social insurance
contributions.
Work practice Registered unemployed
(incl. those over 50).
Allowance provided to
employees (120% of UB).
1 year
(max)
2009
PT Subsidies for permanent
employment contracts
Young unemployed +
unemployed aged over
45.
Enterprises with over 50
employees receive a non‐
refundable lump‐sum subsidy
(up to 12 times the minimum
wage).
4 years
(max)
1995
Recruitment incentives
(Madeira)
Registered unemployed
(incl. those aged 45+).
Permanent contracts:
employers receive a lump‐
sum subsidy for each job
created.
Fixed‐term contracts:
employers receive a monthly
subsidy covering the wages
equivalent to 40% (1st year)
and 30% (2nd year) of the
minimum income in Madeira.
2 years
(max)
2009
RO Subsidies for employers
taking on registered
unemployed
Registered unemployed
(aged over 45 or unique
"bread earner").
Employers receive subsidies
granted from the
unemployment insurance
fund.
2 years
(max)
2002
SI Reimbursement of
employers contributions
(Article 48a)
Unemployed (incl. those
aged over 55 registered
at the PES for at least 12
months).
Reimbursements of
employers' contributions.
15 months
(max)
1999
Promotion of
employment for hard to
place unemployed
persons/Employ.me
Unemployed (incl. those
over 50).
Lump‐sum subsidy paid to
employers.
1 year
(max)
2009
SK Contribution for
employing a
disadvantaged job
seeker
Disadvantaged
jobseekers registered at
the PES for at least 3
months (incl. those over
50).
Wage cost subsidy. 2 years
(typical)
2004
FI Employment subsidy,
private companies
Unemployed (incl. older
people).
Subsidy paid to employers
(which can cover the gross
wage, employer's statutory
social security contributions,
employee pension insurance,
accident insurance,
unemployment insurance and
group life assurance
payments).
3 years
(max)
1979
Source: Eurostat, Labour Market Policy (LMP) database, data extracted on 28/07/2011.
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European Job Mobility Laboratory, November 2011 64
3.7Main findings from the case studies on PES experience
This section summarises the main types of intervention promoted by PES for supporting older workers and
older job seekers in the case studies. It also takes advantage of a very recent study produced by DG
Employment (Hake, 2011), which provides an interesting review of PES experiences with older workers.
The lessons arising from the case studies can be aggregated in three main groups.
How to deal with the specificity of older workers – Older workers are a particularly complex target group
with multidimensional issues that hamper their participation in the labour market. In comparison to other
groups, older workers have a shorter career in front of them and have to deal with more frequent personal
and social problems related to their age. This makes it more difficult to involve them in ALMP and means
that customised services are required. The case studies suggest some solutions:
The utilisation of psychological support together with more traditional labour market and activation
measures is often useful;
Empowerment of older workers is an important component of their successful activation. Networking
and exchanges between older workers/job‐seekers can help to raise self‐esteem and motivation. In
some cases advice and guidance on health issues can help them gain a better perception of their own
capability;
Individualised services are needed to tailor the assistance offered to older workers. It is essential to
consider older workers as a specific target group that needs an individualised approach integrated with
specialised services. The latter two elements are not mutually exclusive and together help to make the
interventions more effective.
How to support the employability of older workers – Lower productivity, lower capacity to adapt to new
technologies or work re‐organisation and higher costs are the most common reasons for discriminating
against older workers. The chances of maintaining or renewing employability are seriously hampered when
these factors are associated with low or obsolete skills and a reluctance to participate in training activities.
PES have tried to deal with this issue by adopting the following:
The implementation of more innovative learning activities, such as coaching or training on the job can
increase the chances of actively involving older workers and produce outcomes that are more rapidly
transferable to the labour market;
competence certification and valorisation of informal competences, often accumulated by older
workers, are important instruments to reinforce interest in learning activities and support the
employability of older workers;
promotion of self‐employment and work with intergenerational links (i.e. services for younger people
or tutoring), where informal competences and experience can be exploited better and the social
relevance of the work is more easily perceived;
working time flexibility (i.e. part time, labour sharing) and direct subsidies can facilitate employability,
limit discrimination and solve more complex individual cases.
How to generate a favourable environment for older workers – the participation of older workers in the
labour market requires ageing strategies at national and local and enterprise levels. In many cases a real
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“cultural” change is needed to overcome prejudices both in labour demand and supply and to identify
different local solutions. To these aims the examined cases propose:
the development of partnerships involving, as well as PES, entrepreneurial associations, providers of
other fundamental services (health, family care, social assistance, etc.) and local institutions. This
approach is particularly relevant in territories dominated by SMEs, which do not have the capacity to
independently develop ageing strategies or make organisational adjustments and are often less inclined
to get involved in ALMP. Partnerships can increase the awareness of the ageing issue among the
different actors, favour their collaboration and coordination, and promote the definition of a local
policy.
Communication on the issue of including ageing and older workers in the labour market is often a
powerful tool that stimulates actors to intervene and activate older workers. Communication can
include advertising campaigns as well as the development of specific IT tools.
The implementation of these interventions requires particular skills within the PES in order to promote the
right services and activate targeted initiatives. There is still relatively little experience among the PES
related to older workers and the creation of working groups or dedicated teams can be useful to cumulate
and exchange knowledge. Capacity building within the PES has to systematically accompany the
development of direct services along the three lines described above.
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4. Conclusion and policy considerations
The analysis of key trends in the European labour market provided some indications as to the
characteristics and the scale of problems confronting older workers; while the case studies offered some
important examples of active services and measures being implemented by PES to support the
employability of older workers. The main findings have already been summarised in the closing paragraphs
of each of the preceding sections, consequently this section intends to use those findings to feed the
European strategy and propose some orientation to the PES strategy for increasing labour participation as
well as the employability of older workers following the approach of their own recent strategic indications
(PES Working Group 2020: making the employment Guidelines operational).
Some strategic considerations
The employment of older people is a strategic challenge for the EU and its relevance will increase in the
near future. Widespread budget consolidation and an ageing population require a balanced
intergenerational distribution of the fiscal burden and of occupational opportunities. This requires a flexible
labour market with a reduced segmentation by age. Europe 2020 and the related Employment Guidelines 7
and 8 recognise this issue and propose a comprehensive approach, based on the principles of flexicurity, to
the regulation of the labour market and the implementation of preventive measures.
A low employment rate amongst older workers is a structural feature of many European countries and is
generally associated with a low employment rate for the overall population. In other words, older workers
do not displace other categories of workers (i.e. young people), but on the contrary suffer from rigidities
and discriminations just like other groups. This means also that specific and stringent policies on their own
cannot change this situation in the short term. Only the coordination of active and passive measures
coupled with reforms of labour markets and of pension and benefit systems can lead to a progressive
solution of this problem, as recent trends have confirmed.
The size of the problem is highlighted by the fact that the EU employment rate of people aged 55‐64 is over
30% lower than that of the prime working age. In addition, with few notable exceptions, EU countries are
mostly still some way from the employment rate target set within the Europe 2020 strategy (75% for those
aged 20‐64 by 2020). Older workers are one of the main components of the potential labour force that can
make an important contribution to achieve that objective.
In spite of the resiliency of older workers during the economic downturn, when employment rates for those
aged 55‐64 continued to rise, problems arise for older workers when they become unemployed or exit the
labour market. Furthermore, a very limited share of inactive older people is actually seeking employment
and is willing to work. These elements highlight the particular weakness of older workers in the labour
market and the need for specific strategies to prevent their long term unemployment and increase their
participation. In this respect the specificity of the older workers issue emerges quite clearly.
In conclusion, a reinforced policy for older workers is urgent in those countries where their participation is
low, but also where the problem is currently less severe as macro‐economics and an ageing population may
require adjustments in the future. Policies for older workers have to be coherent with the overall regulation
of national labour markets, integrate active and passive measures and avoid new segmentation, otherwise
they would only reiterate the imbalances produced by early retirement schemes in the past. At the same
time, policies for older workers have their own specificities in terms of strategy and measures, because the
particular features of this population group demand tailor made solutions. The capacity of joining together
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European Job Mobility Laboratory, November 2011 67
a well‐balanced flexicurity regime based on intergenerational equality and a specific strategy for older
workers is a key to success. The European Employment Strategy provides a coherent and broad strategic
framework to build on national policies. It is essential that Member States pay adequate attention to the
older workers issue in this process and pave the way for long term social and economic adaptation.
National ageing strategies should find adequate space in the National Reform Programmes, according to
the principles of the European Employment Guideline 7 and 8.
The role of PES in the policy for older workers
The study underlines several times that in all EU Member States PES play a fundamental role in the above
mentioned economic and social adaptation path. Competences in terms of labour policy and continuous
interaction with job‐seekers, employees and employers put PES at the centre of the policy arena for
implementing activation and preventive measures for older workers.
Data show that for older unemployed or inactive people PES remain one of the main job search methods,
but its relevance has progressively diminished in recent years. This might be caused either by a decreasing
focus of PES on older workers or by the fact that older people believe the services offered by PES are not
appropriate to their needs. Consequently, specific services, or adjustment of existing services, for older
workers is needed in many PES. The analysis of the case studies highlighted practical examples of how PES
can deal with the challenge of an ageing labour market and older workers. Here, these lessons are
organised according the strategic indications produced by the PES Working Group 2020 in order to suggest
to the PES some operational orientations related to their current priorities.
The PES Working Group identified priorities for implementing employment Guideline 7 (Increasing labour
market participation), Guideline 8 (Developing a skilled workforce) and the key leverages to implement the
priorities for action; a commitment to increase participation in the labour market of the older workers
affect all these three dimensions.
PES priorities for Employment Guideline 7: Increasing labour market participation
Priority target groups – PES recognise the need to focus efforts on those most in need whilst at the same
time maintaining a quality service for the whole range of different clients. From the findings of the study it
is clear that older workers represent an important target group; although the extent to which older worker
are disadvantaged in the market varies between countries there are common difficulties in terms of
entering or re‐entering the labour market and, in some cases staying there. At the same time, older
workers have rather specific needs related to their age and position in society. The difficulties in motivating
older workers to participate in regular ALMP measures means that it is necessary to provide more focused
interventions and to treat them as a specific target group, as well as to avoid unintentional creaming
effects. In this sense, and as mentioned above, a stronger commitment of Member States to build an
ageing strategy would help PES.
Strengthening active and preventive measures at an early stage – Preventive actions to maintain and
strengthen the employability of older workers are fundamental, in order to reduce the social and additional
financial costs of curative action. In this respect case studies show that complementary measures such as
empowerment and general psychological support are fundamental in keeping active older workers in the
labour market and should be used more often in association with more traditional interventions.
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The study has also underlined how these interventions cannot be implemented in the same way as the
interventions for other target groups; the limited return on the investment in human capital for older
workers and the higher social and personal constraints often limit their participation in ALMP. To overcome
these obstacles some of the measures
covered in the case studies demonstrate
experimentation with new methods, such as
coaching, intergenerational cooperation,
and networking with peers. More generally,
the study highlights the need for a
progressive policy mix that shifts from more
traditional or standard services to more
specialised services for older workers in
relation to age. The figure depicts this
process with no ambition of modelling it;
although the relationship seems universal,
the right policy mix has to be defined case
by case in relation to the size and the features of the older worker population and the other contextual
factors (labour demand, available resources in PES, etc.).
Other factors that can positively impact on the employability of older workers are the appropriate
contractual arrangements for these workers (part‐time, job sharing, etc.) and the availability of social
services able to support personal concerns in the families of older workers. These factors do not directly
depend on PES, but PES are required to use all existing opportunities in this respect.
Strengthening personalised services – The previous considerations imply that a personalised approach to
older workers is needed; the various issues that affect older workers present in different combinations for
each individual so that profiling and individually tailored services are necessary. Unfortunately, older
people are generally not as at ease with IT tools and modern communications technology as younger age‐
groups, but specific IT assisted paths for the older generation could be defined within the regular IT tool‐set
of PES without large additional costs.
Further development of services and incentives for employers – Interventions within firms are essential to
avoid the skills of older workers becoming obsolete, to create awareness of the needs of older workers in
relation to the organisation of work and to promote an appropriate management strategy to deal with
ageing issues. This kind of intervention is probably the weakest in terms of existing PES experience, but it is
crucial to support older workers in enterprises and especially in SMEs, which often lack dedicated human
resource managers. Agreements and partnerships with entrepreneurial associations could help to develop
operational models suitable for employers needs and behaviour. In this respect competence certification
and valorisation of informal competences could help make older workers more employable, especially if
working patterns can be adapted to suit their capacity.
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PES priorities for Guideline 8: Developing a skilled workforce
Incentives for lifelong learning – Older workers are at the greatest risk of their skills becoming obsolete
and out of touch with technological change so for them, more than for any other target group, lifelong
learning (LLL) is a fundamental instrument of anticipation and activation. The involvement of older workers
in in‐house training to maintain and update their skills, and their involvement in learning activities
organised in the local area should be supported as far as possible. In doing so, steps need to be taken to
develop training and complementary services in a way that addresses the resistance of some older workers
to participating in human capital investment (too late to learn something new). At the same time, older
workers do not only need training, their experience can also be valuable in training others and it is
important to recognise and make the most of their potential contribution in the role of tutor and trainer for
younger workers.
Promotion of self‐employment – Self‐employment can be an important form of employment for older
workers and a way to exploit informal competences cumulated through the past experience of work. Some
of the case studies showed self‐employment to be effective in facilitating a return to work for older people,
especially when associated with work that at the same time benefits younger people (for instance, child‐
care, transmission of handicraft skills, support to the inclusion of young workers in firms).
Key leverages to implement the priorities for action
The emergence of ageing as a strategic and long term issue requiring active intervention means that older
workers can no longer be set aside through early retirement schemes and instead the PES are being obliged
to confront the demands of what is effectively a new client group with very particular needs. At the same
time, the budget restrictions being imposed in most countries restrict the extent to which staff resources
can be expanded or even diverted to offer new specialised services . In this context, fostering partnership
between PES and other service providers would appear to be a basic and necessary step in order to broaden
the range of services available to suit the needs of older workers. Indeed, a recent study of the European
Job Mobility Laboratory (Partnerships among Employment Services, 2011) showed that this kind of
partnership can be developed on the basis of relatively limited financial resources because it can be based
on agreements with other existing public services (health, social assistance) or third sector providers. Such
partnerships should be developed mainly at local level where the needs of older workers and employers
can be better identified and co‐ordinated. Strategic partnership between key labour market actors
(entrepreneurial associations, trade unions, local or national institutions, private and public employment
services) are also important for the promotion of support for older workers. This is particularly the case in
countries where the participation of older workers is low and initiating public debate and a favourable
context for an active ageing strategy is an important precondition to launch new interventions and services.
In this respect, communication (large advertising campaigns and other communication tools) can be used to
promote new PES interventions and mobilize people to participate.
Although increasing efficiency is a key part of the forward looking strategy of all PES, this should not
preclude PES from investing to increase their capacity to work with older people through appropriate
training for specialist advisors or from refining existing services so that they are better suited to the needs
of seniors (especially e‐services and multi‐channelling approaches, which could limit the costs of
personalised services). This is also important to prevent a possible “creaming” of older clients due to lack of
an adequate service supply. The introduction of specialist advisors to work specifically with older clients
can also promote new thinking and innovation on the ageing policy; to this end, support to connect and
empower PES personnel dedicated to ageing and older workers (promotion of communities of practices,
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European Job Mobility Laboratory, November 2011 70
production of review of cases or guidebook, identification of main skills for service providers, etc.) should
be provided at national and European level.
In conclusion, PES have some experience and knowledge of how to deal with the specific problems of older
workers, but this is by no means universal and in general the approach and operational practice needs to
be developed to confront the growing scale of the problem and the specific needs of older workers. The
study proposes a number of different solutions to be discussed and transferred to policy fields (activation,
employability, partnership) already identified as priorities by the EU and the PES in their strategic
documents. To move in that direction, PES have to promote national and local ageing strategies, identify
the correct service mix for older workers and work in conjunction with other actors to ensure adequate
availability of good quality tailored services that can help provide the blend of support and encouragement
that older workers need to stay in the labour market longer.
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ANNEX: Supplementary data
Table A.1 – Temporary employees as a proportion of all employees, by age group and gender, 2010, (%) Males Females 25-49 55-64 25-49 55-64
EU27 11.2% 6.7% 13.0% 7.1%
Belgium 5.8% 1.9% 8.4% 4.2%
Bulgaria 4.5% 4.7% 3.4% 4.4%
Czech Republic 5.2% 8.4% 7.9% 15.5%
Denmark 5.9% 3.7% 8.4% 3.5%
Germany 10.0% 4.7% 11.3% 4.4%
Estonia 4.2%
Ireland 6.4% 6.5% 7.7% 6.3%
Greece 10.9% 6.0% 14.0% 10.9%
Spain 24.5% 9.3% 26.3% 11.4%
France 10.4% 8.3% 13.2% 8.7%
Italy 9.9% 6.7% 14.3% 5.4%
Cyprus 6.8% 2.8% 23.7% 7.0%
Latvia 8.1% 10.7% 4.2%
Lithuania 2.6% 1.5%
Luxembourg 5.2% 6.9%
Hungary 9.5% 7.0% 9.0% 6.4%
Malta 3.3% 5.1%
Netherlands 13.1% 6.3% 15.5% 7.5%
Austria 5.0% 3.0% 5.6%
Poland 24.7% 19.8% 24.9% 23.2%
Portugal 22.2% 9.1% 23.5% 10.2%
Romania 1.2% 0.8%
Slovenia 11.5% 8.1% 15.8% 10.2%
Slovakia 4.6% 5.2% 4.8% 6.1%
Finland 9.8% 7.0% 18.5% 7.9%
Sweden 10.0% 5.4% 13.8% 5.6%
UK 4.1% 4.7% 5.5% 5.4%
Source: Eurostat, Labour Force Survey: lfsa_egaps
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Figure A.1 – Drift into inactivity of people employed or unemployed in the year before by age groups and level of education, EU 27, 2004 – 2010 (%)
Source: Own elaboration of EU LFS data
Table A.2 – Reasons for leaving last job for people aged 55‐64 currently unemployed or inactive but working the year before (%)
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EU BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK
2006
A job of limited duration has ended 7,8 2,0 20,2 5,5 4,9 5,4 5,0 9,9 10,9 22,2 4,7 11,9 10,9 6,9 16,0 0,0 3,1 1,2 0,8 1,7 4,4 5,3 19,5 3,6 3,4 25,4 15,8 4,9
Dismissed or made redundant 16,5 5,9 15,0 11,8 14,1 26,9 10,7 16,7 2,5 15,6 16,9 13,2 14,6 13,5 6,0 4,5 10,7 3,5 0,0 12,7 13,1 22,3 12,9 10,2 11,6 14,6 23,7 16,4
Early retirement 19,7 9,4 0,6 16,4 52,2 21,0 6,1 19,9 9,6 25,7 8,5 0,0 11,9 9,6 4,3 27,6 22,3 16,7 86,6 30,2 45,1 22,7 16,9 5,2 0,0 5,5 30,1 22,1
Education or training 0,2 0,0 0,0 0,0 0,2 0,0 0,0 0,4 0,0 0,0 1,0 0,0 0,0 0,0 0,0 0,0 0,5 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,6 0,2 0,0
Normal retirement 35,2 33,3 48,9 52,9 4,5 23,9 37,4 20,5 63,2 3,1 59,0 63,9 30,4 32,7 45,2 57,2 54,8 64,6 0,0 35,7 14,7 15,0 40,9 69,2 82,6 27,9 5,4 21,7
Other reasons 9,4 42,8 7,4 3,3 6,5 11,5 3,5 12,4 10,4 12,1 3,0 5,4 12,5 19,3 13,7 5,0 5,8 1,1 6,5 7,6 8,5 22,5 0,9 8,0 2,3 10,3 6,8 16,0
Own illness or disability 11,2 6,6 7,8 10,2 17,6 11,4 37,3 20,2 3,4 21,2 6,8 5,6 19,6 18,0 14,8 5,7 2,7 12,9 6,1 12,2 14,3 12,1 8,9 3,8 0,0 15,7 18,0 18,8
2007
A job of limited duration has ended 10,0 2,4 17,7 5,7 5,1 7,9 2,1 11,4 10,4 24,9 7,8 12,7 17,3 11,9 7,4 1,6 2,7 1,4 2,8 3,8 6,7 8,8 9,0 4,4 3,7 29,8 20,8 8,4
Early retirement 21,6 9,3 1,3 18,4 62,3 25,4 6,2 18,2 6,1 33,5 8,5 0,0 2,8 12,8 12,7 25,6 25,8 13,8 77,6 44,5 53,0 24,9 19,6 10,1 0,0 7,8 38,1 24,1
Education or training 0,1 0,0 0,0 0,0 0,0 0,0 0,0 1,1 0,0 0,1 0,2 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,2 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,2 0,0
Normal retirement 45,0 34,9 62,4 57,9 4,1 32,3 34,3 24,8 70,9 6,7 73,8 77,4 39,0 36,1 37,4 54,2 62,4 72,9 0,0 28,0 20,8 16,3 58,6 78,1 91,4 33,5 7,3 29,0
Other reasons 10,8 44,2 9,3 4,8 8,8 18,4 12,0 17,4 7,6 14,7 2,5 5,6 9,5 14,9 26,2 4,3 7,2 4,5 11,8 7,3 6,6 25,0 0,5 4,4 4,8 11,8 11,5 18,1
Own illness or disability 12,6 9,3 9,3 13,2 19,8 16,0 45,3 27,1 5,1 20,2 7,1 4,3 31,3 24,3 16,4 14,3 1,9 7,3 7,6 16,5 12,9 25,0 12,2 3,0 0,0 17,1 22,2 20,3
2008
A job of limited duration has ended 8,5 2,2 17,1 4,7 2,9 4,0 13,0 9,3 10,2 24,2 7,1 11,2 15,4 7,0 13,0 0,7 2,1 2,5 2,1 3,7 7,7 7,4 7,6 3,3 3,5 26,9 15,3 6,0
Dismissed or made redundant 11,5 3,7 13,2 8,1 12,8 16,9 11,5 16,8 1,4 12,6 10,1 9,8 9,4 16,0 8,3 2,8 9,1 10,9 11,2 6,1 7,9 18,2 7,4 12,1 4,6 15,2 18,4 13,0
Early retirement 19,2 13,8 1,1 15,5 55,6 23,8 20,7 17,1 3,7 25,0 4,7 5,2 9,8 11,9 7,4 22,6 23,1 4,9 63,1 34,6 50,0 21,8 20,5 5,0 0,0 6,9 31,6 23,8
Education or training 0,0 0,2 0,0 0,0 0,2 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 1,0 0,0 0,0 0,0 0,0 0,0 0,2 0,0 0,3 0,0 0,0
Normal retirement 41,4 34,6 46,1 53,5 4,3 32,8 25,9 17,9 72,7 4,5 67,9 66,7 33,6 37,4 41,9 52,1 57,3 63,3 0,0 29,3 15,7 20,0 51,5 70,1 87,7 26,4 8,1 28,9
Other reasons 9,1 37,5 12,7 4,2 7,1 10,9 6,4 21,5 7,0 15,1 4,3 3,7 17,9 9,1 14,6 3,6 6,9 1,9 14,7 9,8 7,9 17,1 0,5 4,7 4,2 8,5 9,3 13,1
Own illness or disability 10,3 7,9 9,7 14,0 17,2 11,7 22,6 17,4 4,9 18,6 6,0 3,3 13,9 18,4 14,8 18,2 1,6 15,4 9,0 16,4 10,8 15,4 12,5 4,6 0,0 15,9 17,2 15,2
2009
A job of limited duration has ended 10,0 3,1 15,9 4,3 3,8 6,1 4,1 7,3 12,7 27,9 8,2 14,0 16,0 6,2 10,7 2,5 2,1 0,5 3,1 3,9 7,1 8,6 8,8 6,2 4,4 23,8 19,3 4,8
Dismissed or made redundant 17,2 5,4 19,1 13,2 19,2 22,6 34,2 41,7 5,8 20,4 14,1 15,3 17,2 40,0 17,4 2,9 12,4 5,6 12,4 8,1 11,9 21,6 7,0 15,9 18,4 17,0 25,6 22,8
Early retirement 21,4 14,2 1,0 17,7 49,6 18,9 13,6 11,1 4,4 22,6 20,1 5,6 11,5 11,8 5,7 26,4 19,8 21,3 57,9 35,1 53,6 20,6 17,6 5,4 0,0 7,2 25,4 20,0
Education or training 0,1 0,1 0,0 0,0 0,7 0,2 0,0 0,2 0,0 0,3 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,3 0,0 0,0 0,0 0,0 0,0 0,0 0,7 0,0
Normal retirement 32,2 30,3 47,8 51,2 4,4 24,2 10,3 13,9 67,1 4,1 49,9 56,5 17,5 23,2 33,5 55,5 54,2 61,5 0,0 28,7 13,4 14,8 57,2 66,2 63,4 31,1 7,6 23,6
Other reasons 9,3 39,1 8,3 4,3 6,5 13,2 17,8 13,8 6,7 12,6 2,6 5,4 20,4 11,4 15,5 4,5 9,4 2,5 16,5 9,8 4,6 13,8 1,0 3,4 5,6 6,2 9,0 15,4
Own illness or disability 9,8 7,7 7,9 9,3 15,9 14,9 20,0 12,0 3,3 11,9 5,2 3,3 17,4 7,3 17,2 8,1 2,0 8,6 10,0 14,1 9,5 20,5 8,3 2,9 8,3 14,7 12,4 13,4
Figures in italics are those calculated on a limited sample
Source: own elaboration of EU LFS data
Figure A.2 – Re‐employment rate of people unemployed, retired or other conditions in the year before by age group and level of education,
EU 27, 2004 – 2010 (%)
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Source: Own elaboration of EU LFS data
Data for people retired with high level of education are unreliable for 2005 and 2006