Last week I wrote about the rise of gerontological entrepreneurship—about the surprising fact that people over 55 have the highest rate of entrepreneurship in the U.S. [“Second Acts and the Aging Entrepreneurship”] Not only does this older demographic have the highest rate of entrepreneurship, but The Kaufman Foundation reports they are much more likely to form successful enterprises than entrepreneurs between 20 and 34. So, contrary to myth and common assumption, the most vital tyro entrepreneurs these days are not the young but the old. Yup. Furthermore, this phenomenon is on the upswing. (How can it not be on the upswing given the fact that 20% of the U.S. population will be over 65 by 2050, in contrast to 14.5% at present, and projected life expectancy will surpass 100 in the near future for developed countries. And we’re not talking here about dottering, demented, diminished individuals, but, rather, increasingly vibrant functional worker bees, with vast life experience.) In fact, the future will increasingly depend on the efficacy of the aged.
Note an excellent article in the Wall Street Journal last year by Nicholas Eberstadt and Michael Hodin titled, “America needs to Rethink Retirement.” (WSJ, 3/11/14, Op Ed, A-15) Eberstadt and Hodin state:
“With declining birthrates throughout much of the world, humanity is getting older. In Europe, the median age has climbed to 43 over the past 30 years, from 34, while in Japan—with the oldest population on the planet—the average age is 46, up from 39 in 1994….One vital question in particular goes largely unaddressed: How [does the western world] build an economic model for an aging society? As the over-60 population grows much faster than their younger working-age cohorts, while life expectancy increases, the 20th-century model of work and retirement becomes increasingly unsuitable for economic growth. The key will be finding new solutions to engage older Americans in the workforce.”
There is a new book out titled Unretirement (Bloomsbury Press, 2014), by Bloomberg columnist Chris Farrell, that predicts seismic change in attitudes towards work and retirement. Among other useful thoughts, Farrell notes that the idea of retirement (presently a word that means withdrawal—meaning a time when folks give up productive work and shrink their activities) is only a relatively recent historical anomaly. Up until the last seventy years humans have had a much more seamless, organic, and productive work relationship with society, family and business right up to death itself.
So how can this changing reality of longevity in the workplace benefit the entrepreneur? Well, I would say it is a huge potential opportunity for small business owners. Workers over 55 are often working happily for less than half their previous wages, particularly within business cultures that enrich their lives with meaning and a sense of value. I believe meaning is a particularly important coinage for older workers in encore careers. They often have fantastic work ethics and invaluable human and technical experience to share. Yet older workers are shunted aside because they are thought to bring expectations of high salaries and health frailty.
This is bullshit and a missed opportunity for the small businessman. There is simply no reason the splendid resource of the newly robust aging worker should not be a useful HR asset. Baby boomers can and are increasingly eager to work at economically competitive salaries.
Note that 65% of those workers 55-64 were working or seeking a job in 2012, up from 56% in 1992. (www.moneynews.com, 1/8/14) I guarantee you that rate is even higher now.
The ROI opportunity offered by the older worker is tremendous. I say this as a selfish, greedy businessman who has successfully used this demographic for over 19 years as a cost effective labor source (along with other non-traditional employees) to generate a dependable, happy, and ethical high-level work force at my own executive sales company, Corporate Rain International.
The prejudice against the older worker (ageism) is a foolish and old-fashioned attitude promulgated out of societal prejudice that is utterly wrong-headed and inefficient. HR departments are ill-considered in their antediluvian smugness about the inadequacy of the older worker. Hiring this growing cadre is simple capitalist good sense. It is amazing to me that “experience” has become a point of discrimination, rather than being welcomed as an opportunity to leverage knowledge and increase profit.
Deborah Banda, a senior adviser at AARP recently said, “Older workers are going to change the workforce as profoundly as women did.” (11/1/13, www.peak-careers.com) I agree. Smart entrepreneurs will be early adopters of this coming wave of useful working persons.
On his retirement from Cornell University, distinguished academic Dr. Scott Elledge said the following: “It is time I stepped aside for a less experienced and less able man.” Uh-huh. Right on, Dr. Elledge.