The rise of millennials grabs headlines and companies scramble to accommodate the expectations of new generations. However, the fact that the workforce is ageing quickly is an equally important trend. This trend is a global one, not limited to Europe and North America. Workforces in many emerging markets in Asia and Latin America are also ageing fast. This will pose a major challenge in the coming decades for a country like China.
The ageing workforce trend has implications for global mobility management because a significant proportion of future assignees are likely to be older employees. More generally, the expatriate population is steadily getting older.
Older professionals represent a significant talent pool. In the context of a talent shortage and shrinking workforce, attracting and retaining older professionals will become increasingly important. Older professionals provide valuable experience and skills that are in short supply. Millennials may be more digitally savvy, but older workers offer essential core skills – from international business management skills to engineering – that can plug the growing skills gap that multinationals are experiencing.
A good example of the contribution of older professionals can be found in the oil and gas industry. Ten years ago, when the sector was booming, a large number of older engineers extended their careers or rejoined the workforce in response to the acute lack of qualified engineers. While the oil and gas sector experienced difficulties in the past few years, the frantic search for qualified engineers and other types of highly skilled professionals has not abated and is spreading to more and more industries.
We discussed in a previous dilemma the mobility of millennials. Older professionals can be as flexible and as mobile as younger ones, if not more. Whereas younger expatriates may have children and family responsibilities, older expatriates no longer have to care for their children and might have already achieved a degree of financial stability that gives them more flexibility in their career choices.
The question of cultural adaptation should also be taken into account: studies show that older assignees are more likely to integrate in the host location and show a range of interpersonal competencies and “soft skills” that are important to the success of international assignments.
Older expatriate workers: demands & expectations
There is a clear business case to send older professionals on assignment, but mobility policies are not necessarily reflecting their needs and priorities.
A primary issue is about company priorities, communication, and workforce integration: there is a widespread recruitment bias against older workers – either conscious bias or unconscious, reflecting the priority given to younger professionals. Ignoring older generations, or at least failing to accommodate their specific requirements, is a significant risk. Career management approaches must be different for assignees who are about to retire.
Introducing flexibility in mobility policies and redefining family support may be required. Traditional family support in mobility policies is mainly about covering education costs for the children. In the case of older assignees, the concern may instead be caring for elderly parents. Caring for the elderly is a major financial and practical burden, and it is not only an issue for Western assignees but also, and even more so, for assignees from emerging markets who cannot rely on state support. If elder care is not addressed by mobility policy it could become a barrier to mobility.
Older assignees may have more financial security than younger assignees but they have to prepare for retirement. Retirement is a more abstract concept for millennials than for professionals who are on their last international assignments and need to make important financial decisions to address pension gaps and to manage their savings (potentially in multiple currencies).
Similarly, healthcare is a pressing issue for older professionals who may have to rely a lot on health insurance and medical support. They may be living with chronic diseases that are perfectly manageable when adequate support and medications are available. These may be more difficult to organise in a foreign country or more costly from a financial perspective. Assignees may require comprehensive health coverage.
Addressing the challenges
Fostering diversity also means taking into account age groups. Review your mobile talent pool and determine if measures need to be implemented to encourage older professionals to go on assignment.
Different employee age groups may have different training needs. Provide trainings to allow older professionals to keep their skills up to date and involve them in mentoring and skill transfers for younger assignees on developmental moves.
Review retirement provisions and offer solutions to help older assignees prepare for retirement and secure a sufficient income. Evaluate how to address pension gap issues and fractured pension histories. Determining the desired country of retirement as early as possible is important and might drive the compensation approach (i.e. guarantee of return to the home country or, on the contrary, preparing for localization in the host destination). Providing financial advice could be beneficial.
Redefine family support. Consider shifting some of the budget normally allocated for education instead to support for care of elderly parents. Adjust the policy to provide more trips home. Ask yourselves if you would agree, in select cases, (when feasible from an immigration perspective) to relocate an elderly parent along with the assignee.
Flexible working and new forms of mobility are not just for millennials. Virtual assignments, third-country assignments and locally hired foreigners are models that could be suitable for older assignees.
Consider hiring silver gig workers. Older professionals could be hired or brought back from retirement as freelancers for specific projects.
It is easy to underestimate the impact of the ageing workforce, but managing an international talent pool effectively also implies attracting and retaining highly skilled older expatriates. In many companies, the arrival of the millennial generation is fostering policy reviews. Don’t forget to take into consideration all segments of the workforce in such a review. Managing age groups is part of diversity management. A mixed workforce with employees from diverse background is more productive, and catering to the needs of all age groups is part of a strategy to become more competitive.
DavidsonMorris’ global mobility specialists work with global employers to support development of high-impact talent mobility strategies and programmes. We understand the challenges of overseas assignments facing both the employer and the employee and can work with you to provide expertise and insight into effective management of assignments to avoid expatriate failure.
Last updated: 2 February 2020