Suddenly 50: the aging workforce and its relationship with the company Free

The latest census in Brazil reveals a significant demographic shift toward an aging population, marking a departure from the country’s previous identity as a predominantly youthful nation. This demographic transition has profound implications across various aspects of daily life, notably in the job market. The 2022 Census unveiled that 27.71% of the Brazilian population was over 50, aligning with the 2020 projections, which suggested that 31.1% of the population would be 50 years of age or older by 2030 and is expected to reach 44.63% by 2060 (IBGE, 2023, 2020).

The increase in the participation of older workers in the Brazilian labor market accompanies this trend. Government data on formal employment indicate a rising number of older workers in the workforce alongside a decline in the participation of younger individuals. Data in the Annual Social Information Report (RAIS) show that 19.14% of formal jobs in Brazil were occupied by professionals aged 50 or over in 2021, significantly higher than the 14.21% recorded in 2010 (Brasil, 2022).

The guiding question driving the development of this research was as follows:

The study sought to address this question by identifying and delineating organizations that embrace policies and practices to attract and retain older workers.

Research publications focusing on older workers gained prominence only after 2010, as evidenced by the bibliometric study conducted by Nagarajan et al. (2019). The authors also underscored the paucity of research on these workers, particularly in developing countries such as Brazil.

The significance and scarcity of studies concerning the impact of increasingly long-lived professionals in the job market were further emphasized by Brazilian researchers. They underscored the necessity for human resources policies and practices tailored to older workers within the organizational context (Amorim et al., 2019; Hanashiro and Pereira, 2020; Silva and Helal, 2022; Tonelli et al., 2019; Vasconcelos, 2018). Thus, this research represents an opportunity to enrich both academic and practical understanding of the dynamics between older workers and their relationship with companies in the Brazilian context.

The research used a quantitative, exploratory and descriptive methodological approach. Data collection relied on the database from the 2020 edition of the FIA – Employee Experience (FEEx) survey, while analysis used the descriptive statistical method of frequency distribution.

This article comprises six sections, including this introduction. The subsequent section presents the theoretical framework, followed by the third section outlining the adopted methodology. The fourth and the fifth sections present and discuss the results, respectively, followed by the sixth and final section containing the concluding remarks.

This section introduces the concepts supporting the development of this research and discusses the scenario of the aging population, its impact on the workforce and the strategies companies are employing in response to this transformation in the labor supply.

The ever-evolving market dynamics and the intensifying global competitive landscape have compelled organizations to embrace novel work models in confronting the imperative of achieving and sustaining success. To retain competitiveness, organizations have had to swiftly adapt to emerging, increasingly globalized and technologically driven markets. This context required transformations not only in their products but also in the operational methodologies of various business domains, encompassing the area of human resources (HR) (Legge, 2005; Ulrich, 1998).

Strategic Human Resources Management (SHRM) has been a topic of discussion among researchers worldwide. It presents different nomenclatures, perspectives and schools, from the most pragmatic to the most critical. This article defined it as an approach to people management that articulates human capital by integrating HR strategies, policies and practices to achieve the organization’s strategic objective (Armstrong, 2011; Kramar, 2012).

Ployhart et al. (2017) observe that acknowledging human capital as the paramount competitive differentiator for organizations underscores the strategic significance of policies and practices to attract and retain skilled professionals. This becomes particularly salient when considering the impact of the organizational context.

Organizations are devising attraction and retention strategies to confront the challenges posed by the increasing demand for a highly qualified workforce. These strategies encompass initiatives such as proactively seeking candidates in educational institutions who are still in a training stage, targeting professionals who are not actively job hunting, and even considering candidates outside the conventional age bracket, including those who are retired (Ployhart et al., 2017; Goldberg et al., 2013).

Hanashiro and Pereira (2020) further emphasize that the strategy of recruiting older workers transcends merely addressing the imperative for qualified labor. It also intertwined with another demographic reality confronting organizations globally: the aging of the world population and, consequently, workforce.

The concept of older workers is subject to variation among researchers, with disagreement primarily revolving around the definition of “older” rather than “worker” (Cepellos, 2013; Fontoura, 2014). Globally, there exists significant variability regarding the age at which an individual is categorized as an “older worker”.

Given the absence of a universally accepted definition, this research considers an “older worker” to be an individual aged 50 or over who is engaged in paid employment. This selection is informed by the work of prominent authors in Brazil (Amorim et al., 2019; Cepellos, 2013; Tonelli et al., 2019) and internationally (Drabe et al., 2015; Napathorn, 2023; Stirpe et al., 2018). Additionally, it aligns with the age group distribution used by the Annual Social Information Report (RAIS), a significant instrument for government management of the Brazilian labor market.

Countries like Brazil, with a population growth rate of less than 1%, have been grappling with the challenges posed by an aging population and its implications for well-being and economic dynamics for some time now (Ezeh et al., 2012; Hanashiro and Pereira, 2020; Silva and Helal, 2022).

This shift in the age composition of a country’s population has direct ramifications for its workforce, stemming from declining fertility rates and increased longevity among the population. The reduction in fertility rates curtails the influx of young individuals into the workforce, while greater longevity results in older workers prolonging their participation in the labor market (Hanashiro and Pereira, 2020; Kooij et al., 2020; Silva and Helal, 2022; Tavares, 2015).

Annually released data by RAIS enables the monitoring of changes in the composition of Brazil’s workforce. These data indicate a rise in the relative participation of formal employees aged 50 and above, increasing from 14.10% in 2010 to 19.14% in 2021. Concurrently, the relative participation of formal employees in the same age group or those under 29 declined from 35.28% to 27.33% during the same period (Brasil, 2022). This suggests a discernible shift in the age demographics of the Brazilian workforce, with potential implications for people management policies and practices, particularly concerning the attraction and retention of older workers.

The diversity of perspectives regarding the concept of older workers is evident when examining their relationship with companies. Some researchers justify organizations’ focus on older workers, considering them valuable assets due to their knowledge and experience (Strack et al., 2008; Vasconcelos, 2018). Conversely, others argue that an organization’s success is not directly tied to the presence of older workers but rather to age diversity within the workforce. Age diversity fosters a job market wherein individuals of different ages occupy the same work environment (Kunze et al., 2013).

Another significant factor affecting the relationship between companies and older workers, which must be addressed due to its detrimental impact on attracting and retaining these professionals, is the stereotype associated with workers aged 50 and over. These stereotypes include perceptions of being averse to change, inflexible, costly, unproductive, having limited ability to learn and use technological resources, fragile health, and lacking creativity (Posthuma and Campion, 2009; Tonelli et al., 2019; Amorim et al., 2019; Turek and Henkens, 2020).

Research conducted internationally indicates that companies’ interest in adopting policies and practices to facilitate the retention and ongoing development of older workers is a contributing factor to their attraction and retention (Armstrong-Stassen and Ursel, 2009; Kooij et al., 2022; Kooij and Zacher, 2016; Polat et al., 2017). However, for these practices to be effective, they must align with the preferences and needs of older workers. Despite the heterogeneity within this demographic group, they share certain characteristics associated with life cycle changes (Kooij et al., 2013, 2022; Rau and Adams, 2005; Stirpe et al., 2018).

Most researchers assert that organizations must adapt their policies and practices to foster successful relationships with older workers. However, critics such as Riach and Jack (2016) question the development of specific policies and practices for managing older workers, arguing against a direct causal link between the attraction and retention of these workers and company performance. Moreover, studies abroad by Leisink and Knies (2011), VA Dalen et al. (2009) and Armstrong-Stassen (2008) suggest that formal policies and practices for managing older workers are not prioritized among evaluated organizations.

Other authors like Ali and French (2019), Napathorn (2023) and Pak et al. (2021) highlight the dearth of empirical evidence on how human resources policies and practices should be tailored to effectively manage the relationship between companies and older workers.

Finally, through an analysis of the quantitative results accessible in the FEEx database, and drawing on the literature concerning strategic HR management and the aging workforce, this article puts forth:

In this section, we outline the techniques employed for data collection and analysis derived from the database of the 2020 edition of the FIA Employee Experience (FEEx) survey, which explores and describes the characteristics of organizations that implement policies and practices to attract and retain an aging workforce, adopting a quantitative approach (Gil, 2021).

The FEEx database was selected for this study due to its periodic updating processes, which preserves the research’s scientific and statistical integrity. Additionally, one of its underlying assumptions is that participating organizations aspire to stand out in the market as exemplary employers, offering favorable work environments and innovative people management practices. Consequently, these companies are particularly pertinent for inclusion in this study.

FEEx, through the People Management Program of the Fundação Instituto de Administração (PROGEP/FIA), had been conducting the “Melhores Empresas Para Trabalhar” (Best Companies to Work For) – MEPT survey annually for over two decades. In 2019, FEEx replaced MEPT with the survey that underpins this study. The 2020 edition of the FEEx survey under review garnered participation from over 150 thousand professionals representing 300 private companies. It acknowledged the top 100 companies that showcased the most significant investments in human resources policies and practices.

The data collection instrument for FEEx 2020 comprised two forms: one completed by company representatives, predominantly human resources managers, and the other by a random sample of employees from these companies. For this study, responses to 14 questions from the form filled out by the companies were selected. These questions aimed to elucidate the characteristics of these organizations and their people management practices relevant to the subject under analysis. The statements of these questions can be found in  Appendix.

The quantitative data extracted from the top 100 companies identified in the 2020 edition were analyzed using the descriptive statistical method, using frequency distribution (Gil, 2021; Sampieri et al., 2006). This approach facilitated the characterization of organizations implementing policies and practices to attract professionals aged 50 or over. The ensuing results will be presented in the subsequent section.

Within the cohort of 100 companies acknowledged by FEEx in 2020 as “Amazing Places to Work”, 95% indicated they were implementing initiatives to attract and engage employees, while 52% were focused on ensuring internal diversity within their workforce. However, only 4% (or four out of the cohort of the 100 companies) disclosed having specific policies and practices aimed at attracting professionals aged 50 or over. To maintain confidentiality, these four companies were designated by letters of the alphabet (A, B, C and D), as per the agreement signed by all parties involved.

This section aims to provide a concise overview of quantitative data extracted from the FEEx database, which underwent analysis via frequency distribution and are presented in tables facilitating comparison between responses from the broader FEEx panel and companies A, B, C and D.

Table 1 illustrates that companies A, B, C and D not only have policies targeting individuals aged 50 or over but also work to attract other demographic groups, including people with disabilities, women, individuals of Black ethnicity and other minorities. The distribution of companies in the general FEEx panel with policies aimed at attracting minority groups is presented in the second column alongside the description of these groups in the first column.

The four companies (A, B, C and D) are classified as medium to large companies based on their number of employees, as depicted in Table 2. By the end of 2019, these four companies collectively employed a total of 6,098 professionals, constituting 1.9% of the total workforce represented in the FEEx general panel.

The subsequent Figures 1 to 4 illustrate the distribution of employees within the FEEx general panel, and the four selected companies categorized by gender, level of education, length of service and age group.

Another noteworthy aspect revealed by the collected data was the companies’ investment in leadership development, benefits packages and special programs, as illustrated in Tables 3 and 4.

This section delves into the quantitative data presented earlier to specifically delineate the characteristics of companies that have declared the implementation of policies and practices targeting workers aged 50 or over.

Among the companies comprising the FEEx 2020 general panel, only 4% indicated the presence of such policies and practices, a figure akin to the result reported by Amorim et al. (2019) five years prior. Their study, analyzing responses from the top 150 organizations ranked by the 2015 “Melhores Empresas Para Trabalhar” (Best Places to Work For) – MEPT survey, found that only 3.3% of the general panel mentioned older workers in their policies and practices.

In terms of gender distribution, companies A and C stood out from both the other companies and the general panel. Company A exhibited a notably high concentration of women in its workforce (72.3%), while Company C had a predominantly male workforce (79.3%).

The distribution of educational levels among the four companies differed from that of the general panel. There was a notable concentration of professionals with secondary education (58.6%, 69.5%, 59.2% and 61.4%), with companies C and D also exhibiting a significant number of workers with only primary education (17.4% and 20.8%, respectively).

Furthermore, the four companies displayed distinct characteristics regarding the length of their employees’ service, with company C standing out for having a majority of employees with less than 10 years of service, potentially indicating its relatively recent establishment compared to the others.

Company B notably had a higher proportion of employees aged 50 or over (15.1%) compared to the general FEEx panel (7.9%), approaching the national scenario reported by RAIS in 2019 (18.7%). Conversely, Company D had the highest concentration of employees under 25 years of age (33.8%), diverging significantly from both the general FEEx panel (15.8%) and RAIS data for the same period (13.68%). These results underscore the lack of uniformity or commonality among the four companies in terms of the prevalence or proportion of older workers among them, despite all declaring the adoption of specific practices to attract older workers.

Analysis of responses from companies in the FEEx general panel revealed that 37% of organizations declared having specific actions to prepare their young leaders to work with older subordinates, a figure slightly lower than the 42% that declared having actions to prepare these same leaders for managing younger subordinates. It is noteworthy that among the four companies selected from the panel, three declared having actions to prepare their young leaders to handle both older and younger subordinates. On this topic, it is worth mentioning that several researchers emphasize the importance of companies training their leaders to value and respect older workers (Armstrong-Stassen and Scholosser, 2011; Heisler and Bandow, 2018; Mori et al., 2024; Sterns and Miklos, 1995; Vasconcelos, 2018). The image HR leaders and professionals have of older workers and their attitude toward these employees directly impacts the success of their hiring and retention (Posthuma and Campion, 2009; Kunze et al., 2013; Fasbender and Wang, 2017; Rego et al., 2017, 2018; Tonelli et al., 2019; Turek et al., 2019; Lossbroek et al., 2021).

From the FEEx general panel, 31% of companies declared having a flexible benefits program, allowing employees to choose between various benefit options. Among the selected companies, only company A was part of this group. Additionally, Company A offered a private pension plan to all employees, a practice present in 39% of the general panel.

Regarding special programs, preparation for retirement was a practice only in Company B, and it has been in operation for less than three years. In the general panel, 14% of organizations offered this service to employees.

All four selected companies offered the possibility of opting for flexible working hours within legal standards; in two of them, this practice had been in place for over three years. Overall, this practice was present in 71% of companies, with 51% implementing it for less than three years.

The lack of congruence observed among companies A, B, C and D regarding the policies and practices adopted concerning older workers aligns with the findings of authors such as Ali and French (2019) and Pak et al. (2021). These authors also noted a lack of empirical evidence on how human resources policies and practices should be adjusted to be effective in the relationship between companies and older workers.

In summary, when comparing the four selected companies, they are similar in having a greater concentration of professionals with secondary education, developing recruitment actions for at least four minority groups in addition to people aged 50 or over and offering their employees the option of flexible working hours.

The development of this research was guided by the question:

The objective was to identify and characterize companies with formal policies and practices for attracting and retaining older workers.

Five years after the results found by Amorim et al. (2019), and contrary to what the authors believed, there has been no increase in the number of companies integrating population aging in their strategic discussions and creating policies and practices to attract and retain older workers. Regarding the demographic profile, different from the author’s expectations, the four companies that adopt policies and practices to attract and retain older workers are quite distinct from each other. The similarities are limited to their employees’ level of education.

In general, the results of this study reinforce findings from other Brazilian studies (Amorim et al., 2019; Cepellos, 2013; Hanashiro and Pereira, 2020; Silva and Helal, 2022, and Vasconcelos, 2018) that suggest companies are not yet adequately prepared to attract and retain older workers due to a lack of policies and practices aligned with the needs and aspirations of these professionals.

The research findings do not elucidate why companies renowned for their human resources management prowess have not shown an increase in recruiting older workers, as anticipated by the authors. One potential explanation is that the aging workforce may not be a focal point of strategic discussion within these companies, as noted by Leisink and Knies (2011), van Dalen et al. (2009), and Armstrong-Stassen (2008). Unearthing these underlying motivations could serve as a valuable avenue for future research development.

Another implication stemming from the research results is the imperative for companies to assess the readiness of their leaders to effectively manage older workers. As previously underscored by Armstrong-Stassen and Scholosser (2011), Heisler and Bandow (2018), Sterns and Miklos (1995) and Vasconcelos (2018), the pivotal role of direct leaders in both attracting and retaining older workers cannot be overstated.

During the research, an interest arose in identifying the factors motivating companies A, B, C and D to adopt specific policies and practices to attract older workers. However, the quantitative approach used did not provide access to this information, creating a gap that encourages further investigation and necessitates future qualitative analysis.

This research presented limitations resulting from methodological shortcomings. One such limitation is related to the use of the FEEx database. These companies do not constitute a statistically representative sample of all Brazilian companies; rather, they belong to a select group aiming to distinguish themselves as good employers within the formal work establishments in Brazil. Consequently, while the results are significant for recognizing human resources policies and practices in force in Brazil, they are not generalizable. However, this limitation also serves as a suggestion for future research by diversifying the sample profile to include companies beyond the FEEx participants.

This study was possible thanks to the Programa de Estudos em Gestão de Pessoas da Fundação Instituto de Administração (PROGEP/FIA) and the research team at the ATMOSFERA FIA platform.

Table A1