Having a multi-generational workforce will be important for companies as they recover from the coronavirus pandemic, according to an insurance group chief.
Andy Briggs, CEO of U.K. pensions and insurance business Phoenix Group, told CNBC's Squawk Box Europe that age diversity should be a focus, as well as gender and ethnicity.
"There's a lot of focus in businesses on gender, on ethnicity, and absolutely rightly so, because the best businesses are inclusive and diverse businesses. I'm just keen that there is an age spectrum to that consideration as well," he said on Monday.
He highlighted that during the pandemic, "the younger and the older workers, the two ends of the spectrum, are the ones that have been most impacted" when it comes to employment.
Businesses have laid off staff in many sectors as pandemic stay-at-home measures have forced some companies to shut their doors. Of the 370,000 people made redundant in the U.K in the three months to the end of October, 112,000 were over 50, according to data from the Office for National Statistics (ONS) released in December.
Briggs, who is also the U.K. government's business champion for older workers, said: "Inclusive and diverse businesses are better businesses that make better decisions from a broad range of perspectives, they better represent their customers, they better represent their communities as well … A workforce that has younger, middle-aged and older workers will perform better than one that doesn't have that breadth of workers."
When asked how employers needed to tackle skills gaps, Briggs said older workers have "life experience" but may need retraining in some areas. "It's important that businesses think about that across the whole age spectrum, not just in respect of younger workers," he added.
Like other countries, the U.K. has an ageing population: the ONS projects that a quarter of citizens will be 65 or older by 2050, up from about a fifth in 2018. This is significant when it comes to retirement benefits.
"With an ageing population, in any developed nation, you're going to see reducing state support, because there will be more people retired relative to those working, and it's inevitable that people need to think about either saving more, and or working for longer," Briggs said.
Given low interest rates and the return on investment relative to inflation, people need to consider how their savings are invested. "(They) also need to think about the amount they're saving, and then how long they're going to work for," he added.
The type of pensions people have has also changed, Briggs said. "If you go back 20, 30 years ago, most people had what we call defined benefit pensions, which give a defined (financial) benefit each year of life … Today most people have defined contribution pensions, where they're paying a regular amount, or their employer's paying a regular amount each month, and therefore they need to have much more focus on what level of retirement income they're going to get."
The U.K. introduced automatic enrollment into pensions in 2012, meaning that employers had to put their staff into a workplace scheme — and contribute to it (employees can choose to opt out if they wish).
"As a result of that we now have 20 million people saving in workplace pension schemes. Five or six years ago that would only have been 10 million so there's a lot of government policy that's been very positive," Briggs stated.
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January 14, 2021 at 04:00PM
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Covid pandemic shows why businesses need to prioritize age diversity too, CEO says - CNBC
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