Creating a culture of opportunity for employees of all ages 

Employers are poised to benefit from employees living longer lives since these employees may work longer as well. However, there are significant costs, risks and complexities to manage when the workforce includes an increasing number of employees who are past the traditional retirement age. Healthcare costs will continue to rise and, with the added pressure of shifting demographics, employers may face more cost pressures than they do today. To thrive in the era of longevity, employers will need to think creatively about workforce health, retirement, and career planning.  

Start by focusing existing programs on helping members – no matter their age or background – to develop strong habits of health that will enable them to be good utilizers of healthcare throughout their entire lives. This can include reducing friction in the system, rewarding healthy habits, optimizing low-cost, high-quality care, offering robust mental health benefits and creating an open and supportive environment.  

Mercer has collaborated with the World Economic Forum to advance dialogue around the importance of longevity literacy, which empowers individuals to live a healthy and sustainable life built on three pillars: quality of life, purpose and financial resilience. Globally, by 2050, over 2.1 billion people will be over 60 years old – more than twice as many as in 2020; increasing the risk of outliving their retirement savings by between eight to 20 years.  

Building the financial resilience to support longevity requires a holistic approach and employers have an important role to play. In planning for the longevity economy, keep in mind these six principles: Ensure financial resilience across key life events; provide universal access to impartial financial education; prioritize healthy aging as foundational; evolve jobs and lifelong skill-building for a multigenerational workforce; design systems and environments for social connection and purpose; and intentionally address longevity inequalities, including across gender, race and class. 

Retirement is already in crisis. If the centenarian life span becomes a reality, people hoping to retire at the traditional age will need to be able to save for a potential 35 years of retirement. However, Mercer’s Global Talent Trends Survey 2022 found that 80% of American workers do not expect to retire fully once they reach standard retirement age, with a shocking 39% saying that they will need to keep working due to financial necessity. The joy and hope of a centenarian life span cannot be simply that we will work longer – it’s the ability to see, do, and learn more. How can employers support their most valuable employees financially while also helping them to live meaningful lives? 

One answer to the problem of retirement funding is that it is already becoming a tailored experience. Employers are having conversations about phased retirement plans, or ‘alumni networks’ of retired employees who are able to provide mentorship, training or gig-type work. And while we will all probably be working longer, providing more significant time-off benefits throughout our extended careers may be an answer to enabling tenured employees to pursue the purpose they seek. 

In the face of longer life spans, employers need to prioritize continuous learning and upskilling opportunities for their employees. By investing in their development, employers can help employees adapt to a rapidly changing world and transition to new roles within the organization. This investment in continuous learning is a solid strategy for improving adaptability and ensuring a valuable and fulfilling career for employees of all ages.  

Employers should shift their focus from traditional hiring criteria, such as education and years of experience, to skills-based hiring. Valuable soft skills, such as critical thinking and problem-solving, can be translated into building blocks for upskilling or reskilling new employees. By recognizing the potential in individuals and providing opportunities for growth, employers can tap into a diverse talent pool and foster innovation within their organizations.  

As people live longer, career paths are likely to change, leading to multi-stage careers rather than a linear progression from education to work to retirement. Age diversity within the workforce will become increasingly important, requiring employers to adapt policies and practices to create inclusive and adaptable work environments.  

Collaboration between generations can lead to innovation, improved problem-solving and a positive work environment. Employers should recognize and leverage the wealth of experience that older workers bring, ensuring a smooth transition as they begin to phase into retirement. By embracing inclusivity, employers can preserve institutional knowledge and create a culture of opportunity for employees of all ages.