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The Problem of Diversity/Age Discrimination in Business

Since 2020, millions of Americans left their jobs amidst all the disruptions the pandemic introduced. Of these, about a million were older adults, defined as being 55 years or older. For some, the decision to leave the workforce was voluntary. They chose to retire early or pursue new business ventures on their own. But a significant number, about 400,000 in total, lost their jobs and were unable to find new work. While there are many reasons so many older individuals lost their jobs, ageism in the workplace is one as well. In fact, older adults are half as likely to be re-employed in a post-pandemic world as younger workers.

(Peruse some poignant post-pandemic prognostications in this Bold story!)

Ageism at work is definitely live and well in today’s world. Despite age discrimination being against the law, prejudices and biases against older adults are deeply entrenched. Efforts toward making business environments more diverse and inclusive have been admirable. But many focus only on gender and race issues. Rarely is ageism in the workplace discussed, and little progress has been made as a result. But it’s time businesses received a wake-up call in this regard. Ageism at work is not just wrong and unjust but also costly. And failing to recognize this undermines all companies abilities to succeed.

“Ageism harms everyone – old and young. But often, it is so widespread and accepted – in our attitudes and in policies, laws and institutions – that we do not even recognize its detrimental effect on our dignity and rights.” – Michelle Bachelet, United Nations High Commissioner for Human Rights

A Snapshot of Ageism in the Workplace

It must first be recognized that individuals make up a significant percentage of today’s workforce. In total, those over 55 years of age represent about 37% of workers. However, the portion of this age group has a much lower employment rate when compared with those less than 55 years. About three-quarters of younger workers are actively employed, yet only a third of older individuals are. One might assume this is by choice, but that would be a mistake. More than a third believe ageism at work makes it more likely they’ll lose their job. And nearly 60% state they experience ageism in the workplace on a regular basis.

Surveys have supported these insights about ageism at work even further. Overall, about 7% lose their jobs each year as a result of ageism in the workplace. Likewise, about 12% fail to receive a promotion because of their age. In one poll involving 83,000 participants, over half showed clear prejudices against older workers because of their age. Given these statistics, it’s hard to argue that ageism in the workplace is improving. In fact, researchers note that while diversity and inclusion efforts are better for race and gender prejudices, there not for ageism. And in the wake of the pandemic, this is highly concerning.

(Read up on the importance of diversity and inclusion in business in this Bold story.)

“As countries seek to recover and rebuild from the pandemic, we cannot let age-based stereotypes, prejudice and discrimination limit opportunities to secure the health, well-being and dignity of people everywhere.” – Dr. Tedros Adhanom Ghebreyesus, WHO Director-General

Costly to Workers and Businesses

In addition to being unfair and unjust, ageism in the workplace is also quite costly. From a business perspective, estimated costs related to ageism at work exceeds $63 billion a year. Certainly, some of these costs may be related to age discrimination lawsuit settlements, but this is a small percentage. The majority of the cost relate to direct impacts to worker health and indirect losses of institutional knowledge. In terms of the latter, letting go of older workers depletes the company of valuable experience and insight. And this is quite difficult to replace with a younger, less-experienced workforce.

A younger boss giving his older worker some trouble
Ageism in the workplace is a problem that deserves attention–especially in the post-pandemic era.

For workers themselves, ageism in the workplace is also highly detrimental. Ageism at work is linked to higher levels of stress and to lower self-esteem. Both of these undermine productivity and can create self-fulfilling prophecies. Similarly, age discrimination is known to cause physical health problems as well. One study demonstrated more advanced age-related changes in the brain among those subject to age discrimination. Others may develop stress-related conditions such as hypertension, ulcer disease, and insomnia. These too affect worker productivity and business outcomes in profoundly negative way.

“People walk out of companies now with an enormous amount of intellectual property in their heads. They know things that are essential to the company’s success.” – Paul Rupert, Founder and CEO of Respectful Exits

Fixing the Problem

Most businesses are aware that legislation exists to protect older workers from various types of age discrimination. The Age Discrimination Employment Act was passed in 1967, and the Workplace Investment Act in 1998. Both prohibit ageism in the workplace and have been the basis for many legal claims. But it is clear that legislation as well as enforcement have done little to change the practice of ageism at work. If true reforms are to be accomplished, then businesses will need to take the initiative. Thye must invest in diversity recruiting. And realizing it is clearly in their best interest should be enough of an incentive to lead the way.

As a starting point, businesses need to include ageism in the workplace as subject matter for their diversity and inclusion programs. Leaders and members of organizations alike need to receive education concerning the harmful impacts of ageism at work. At the same time, organizational values and policies must align to protect older workers. As always, actions speak louder than policy and procedure manuals. Therefore, business leaders must not only serve as role models but follow through with company policies. Finally, businesses should strive to have diverse age groups within the company. Intergenerational interactions have been shown to reduce ageism at work and is something all companies should pursue.

All too often, business mistakenly see older workers as inflexible, costly, and unproductive. Youthfulness and the latest technology looks sexy, and workers over 55 don’t. But appearances are often misleading, and businesses need to explore how ageism in the workplace might be affecting them. Given the stats, it’s highly likely ageism at work is occurring, and the company is losing some of its most valuable assets. As with all types of discriminations, false assumptions and biased views taint wise decision-making. Ageism in the workplace is simply another example of this, and one that all businesses need to examine.


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