EUROPEAN PAPERS ON THE NEW WELFARE

Company Initiatives for an Ageing Workforce in Italy

Abstract

In the light of the strategies recently activated by the European Union to prolong the working life of the workforce, this article aims to provide an overview of the initiatives currently implemented by companies in Italy with regard to their older employees. The study was conducted in 2005 within the framework of the European research project “Employment initiatives for an ageing workforce” on behalf of the European Foundation for the Improvement of Living and Working Conditions.
Through semi-structured qualitative interviews, the experiences of 13 Italian companies were analysed in relation to the current demographic and political-normative scenarios in Italy and Europe, and are also discussed in relation to the activities undertaken by the social partners. The data reveal that, with rare exceptions, Italian companies seem unprepared to tackle the issue of age-based personnel management, not least because they are hampered by the lack of a national policy to deal with the question as a whole. Indeed, there is little cohesion among the parties involved, which prevents the change underway from being managed systematically and with suitable means.


1. Prolonging Working Life in Italy and Europe

As a result of increased life expectancy and falling birth rates, Europe is ageing rapidly. With regard to the labour market, the most critical effects will be felt around 2030-2035, when the baby-boomers born in the 1960s reach retirement age. By then, the number of people over the age of 65 years in Europe will have risen by 60% in comparison with the year 2000, while the number of those aged between 15 and 64 years will have declined by 18% (Employment Taskforce, 2003: 12).
Realising that this scenario will impact negatively on the socio-economic systems of most European countries, and particularly on current systems of social security, the European Union (EU) has for some years promoted strategies aimed at prolonging the working life of its citizens (European Commission, 2002: 3; Employment Taskforce, 2003: 11; European Commission, 2004a: 5; OECD, 2005: 6). In 2003, the European Commission set up a taskforce on employment in order to monitor the effect of these policies, and the findings of the taskforce were clear: Europe would be unlikely to achieve its objectives, because the improvements envisioned were occurring too slowly (Employment Taskforce, 2003: 11 and 58; European Commission, 2004b: 5). These conclusions immediately prompted the European Commission to urge member states to adopt more drastic measures (European Commission, 2004a: 3; European Commission, 2004b: 5).
The phenomenon of population ageing is even more acute in Italy than in most other European countries. Moreover, in Italy the percentage of older people who work is among the lowest in Europe (European Commission, 2006a: 14). The situation is therefore one of the most critical in terms of the objectives set in Lisbon in 2000 (Employment Taskforce, 2003: 14; Ceccarelli, Coccia and Verzicco, 2005: 172; ISTAT, 2005; ISTAT, 2006; OECD, 2006: 21) and in Stockholm in 2001 (Employment Taskforce, 2003: 15; European Commission, 2004a: 18; OECD, 2004: 9; Senato della Repubblica, 2005: 13; ISTAT, 2006). Nor are future prospects optimistic (AARP, 2004: 3; European Commission, 2004b: 9; Senato della Repubblica, 2005: 11), since in 2050 well over a third of Italians are likely to be more than 65 years old (OECD, 2004: 9 and 31). In addition, the hiring rate of older workers is particularly low (OECD, 2006: 36), the gender gap in employment is still too wide (OECD, 2004: 9; OECD 2006: 28) — though it is narrowing (European Commission, 2006a: 13; ISTAT, 2006) — and the level of education/qualifications of the workforce is poor, especially among women (Employment Taskforce, 2003: 16).
In order to ensure the long-term sustainability of the socio-economic and social welfare systems in Italy, older workers should be encouraged to prolong their working life (Inglese, 2003: 190; OECD, 2004: 61). This implies postponing retirement and putting an end to company policies of making older workers redundant, often as part of restructuring processes (Senato della Repubblica, 2005: 38). The three pension reforms adopted in Italy during the 1990s (Amato, 1992, Dini, 1995 and Prodi, 1997) moved in this direction. Success was however limited, in that Italian companies continued, within the terms established by law, to encourage older workers to retire once they had fulfilled the requisites for retirement (or early retirement), in order to get rid of their ‘weakest’ workers (in terms of competitiveness) (Van Dalen and Henkens, 2002: 209; OECD, 2004: 57; Senato della Repubblica, 2005: 18).
The reasons behind this situation can be better understood in the light of some structural and cultural features that distinguish Italy (and, in part, other Mediterranean countries) from many Central and Northern European countries, and which also influence how the parties involved in the still marginal debate on the ageing workforce in Italy view the problem. It should in fact be borne in mind that: a) the youth unemployment rate in Italy is well above the average of the 25 EU nations (24% as against 18.5%, EUROSTAT, 2006a), being lower than those of Greece and Poland only; b) most of the people currently over 50 years old have a low level of education/qualifications and, having started work when they were young, have already been employed for many years by the time they are 55 (OECD, 2004: 14); c) many of the over-50s (especially women, but not only) prefer to devote their energy to supporting the family (i.e. looking after grandchildren or elderly parents, etc.) and are therefore unwilling to carry on working (OECD, 2004: 45).
The early retirement policies so far implemented by most companies in Italy run counter to the projected composition of the workforce in the future, in that, for demographic reasons, the number of young people entering the labour market will be insufficient to replace retiring older workers. Nor is the shortfall likely to be taken up by immigrant workers, in spite of their rapidly growing numbers (EUROSTAT, 2006b). Although it is deemed inevitable that the percentage of older workers in Italy will increase, even in the worst case scenario (OECD, 2004: 41; OECD, 2005: 7), this conviction has not yet been reflected in company strategies, which have remained unchanged. Indeed, the issues involved in keeping older workers in the workplace have, in practice, been tackled only within the political-institutional sphere, and especially at the international level, as shown by the several organisations that have developed a certain awareness of the problem and implemented age-management policies designed to keep on workers eligible for retirement (White, 2002; IBM Business Consulting Services, 2005), though this cannot yet be considered the rule (Collins, 2003: 155).
The need to keep older people at work is dictated chiefly by macro-economic and welfare concerns. Clearly, however, there is also a need to ensure that older workers experience this extension to their working lives in the best possible manner, and in particular that they perceive it not as an imposition but as a choice freely made by an informed individual (Carrera and Mirabile, 2003: 36; Employment Taskforce, 2003: 8; European Commission, 2004a: 13; Ilmakunnas and Takala, 2006: 58-9; OECD, 2006: 137). This implies the implementation of a range of coordinated measures and intervention of a micro-organisational, psychological and social nature. In this regard, a key factor is the adoption of policies designed to improve working conditions (Paci, 2003: 13; European Commission, 2004a: 9-12; European Commission, 2004b: 25; OECD, 2004: 11; Senato della Repubblica, 2005: 38) by explicitly identifying objectives and implementing criteria and methods for safeguarding the health and well-being of older workers. Indeed, while on the one hand empirical evidence reveals that working to an advanced age improves self-perceived health and increases one’s sense of independence (Hammerman-Rozemberg et al., 2005: 508), on the other hand health problems are often a decisive factor in prompting early retirement (Salonen et al., 2003; McGarry, 2004; Raymo et al., 2004: 542; Datta Gupta and Kristensen, 2005: 9), especially when they arise in the pre-retirement period, which is often viewed by older workers as a time of uncertainty and crisis (Ekerdt et al., 2001: S169; Nuttman-Shwartz, 2004: 235). Thus, early retirement is often perceived by the individual as being ‘enforced’ (Szinovacz and Davey, 2005), and is therefore actually viewed as ‘expulsion’ from the productive sphere. In addition to causing financial difficulties, it also impacts negatively on the physical and mental health of the person (Gallo et al., 2000: S136) and on the possibility of finding alternative employment (Chan and Stevens, 2001).
While this problem has received scant attention in Italy, other countries have begun to make large-scale systematic use of ad hoc indicators to assess work ability. The best known of these, the Work Ability Index, was conceived in Finland but is now widely used in various Northern European countries (Ilmarinen, Tuomi and Seitsamo, 2005: 7). By measuring ‘work ability’1, companies are better able to cope with changes due to the ageing of their human resources; both the working environment and production methods can be adapted to suit the conditions of health and work capability of employees (Datta Gupta and Kristensen, 2005: 11), thereby raising the self-esteem of workers and increasing their productivity (Reitzes and Mutran, 2006). Moreover, in addition to improving productivity and the quality of work, promoting the work ability of older workers also discourages early retirement (Tuomi et al., 2001). Where this approach has been systematically pursued, as in Finland’s “National Programme for Older Workers 1998-2002” for instance, impressive results have been achieved, as is revealed by the marked increase in the employment of older workers since the end of the 1990s in the 15 countries then constituting the EU (Ilmakunnas and Takala, 2006: 56-8).
A determining factor in this trend lies in the ability of companies to change their attitude towards older workers. This means helping them to adapt to changes in technology and work organisation (Hutsebaut, 2005: 117; Tagliabue, 2005: 4; OECD, 2006: 67) and being aware that age-related discrimination in the workplace is conducive to retirement (Snape and Redman, 2003) and/or absenteeism (OECD, 2006: 77). In Italy — and elsewhere (McMullin and Marshall, 2001: 120-1; McVittie, McKinlay and Widdicombe, 2003; Berger, 2004: 513; Shah and Kleiner, 2005) — such discrimination is widespread (OECD, 2004: 12; Curtarelli, Incagli and Tagliavia, 2005: 104-7; European Foundation, 2005: 5; OECD, 2006: 64 and 106). Moreover, no specific laws are available to tackle its various manifestations, as for instance with regard to hiring and training (Paci, 2003: 13; Senato della Repubblica, 2005: 33; OECD, 2006: 74) or premature dismissal (Mordicchio and Pugliese, 2005: 39-40).


Andrea Principi: Italian National Research Centre on Ageing (I.N.R.C.A.), Department of Gerontological Research, Ancona, Italy, via Santa Margherita, 5 – E-mail: a.principi@inrca.it
Marie V. Gianelli: Geriatric Neuropsychology Laboratory, Department of Endocrinological Sciences, Medical Faculty, University of Genova.
Giovanni Lamura: University of Hamburg, University Medical Center of Hamburg-Eppendorf, Department of Medical Sociology, Working Group of Social Gerontology, Hamburg, Germany.
Acknowledgements: We gratefully acknowledge the European Foundation for the Improvement of Living and Working Conditions (© 2006, Wyattville Road, Loughlinstown, Dublin 18, Ireland.Original language: English), for grant No. 0296-2005, which enabled us to carry out the comparative survey on which the national study presented in this article is based.
1 Work ability is defined as “workplace activities aiming at maintaining the ability to work, including all measures that the employer and employees, as well as co-operative organisations at the workplace, make in a united effort to promote and support the ability to work and to enhance the functional capacity of all persons active in working life throughout their working careers” (Costa, Goedhard and Ilmarinen, 2005: v-vi).


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