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HR Today Research: “Job seekers over 50 on the Swiss job market”

By 6. April 2020 No Comments

Job seekers over 50 on the Swiss job market – demystifying a big dispute

Dr. Pascal Scheiwiller,
CEO of von Rundstedt & Partner Schweiz AG

Peter G. is an experienced banker. Until recently, he worked for almost fifteen years in asset management with a large bank. He says he knows banking inside and out. After completing his apprenticeship he was employed in a variety of areas, including lending, private consulting, corporate consulting and private banking. Finally, he landed in asset management. For a while he also worked for two years in the recovery team of a cantonal bank. Today Peter is 55. Three years ago he was given notice, and since that time he has been unemployed. Although he has applied for vacant positions and sent out unsolicited applications, he has rarely been invited for an interview. His applications for vacancies gather dust on job platforms. The unsolicited applications either go unanswered or are rejected with the usual standard phrases. Now Peter has begun to apply for work not just in banking and insurance but in widely differing areas and for jobs of all kinds. He has practically abandoned all salary demands and would be satisfied with CHF 5,000 a month. He would also be willing to learn new things and take up a different kind of work. But nothing helps. His social contacts are dwindling and he rarely attends public events. What could he tell people about himself? His family is getting impatient. Desperation and frustration are setting in. For Peter it is abundantly clear: when you’re over 50, the job market can be grim.

Everybody’s complaining

Stories like Peter’s are very common. However, it would be too simple to sum it up by saying that the Swiss job market has a problem with people over 50. That is because this group is not the only one that feels disadvantaged. Young people likewise find it hard to gain a foothold in the job market. Employers criticise their lack of experience and poor morale, and they have little appreciation for the many years students spend at the university. Women also complain about being passed over for important positions and functions. Moreover, those between 30 and 40 know that their employers fear they will become pregnant. And what about native Swiss citizens in their own job market? They too feel disadvantaged and exposed to unfair competition. Their natural, justified expectation of good pay is persistently undercut by foreigners who are willing to work for less. For their part, foreigners who have trouble with the local language complain about their particular difficulties, made worse by the fact that Swiss employers haven’t yet switched to business English. Then there are the many Swiss workers without higher education who complain that in their university-obsessed country they can hardly even get a “normal” job without a bachelor’s or master’s degree. Labour unions criticise employers’ rigid focus on productivity and their unwillingness to open the job market to weaker members of society. And on and on it goes. There seems to be a universal trend to sniff out injustice and complain about discrimination. Instead of focusing on individual problems, people hunt for broad conspiracies and call for rules and prohibitions. It is easier to question the system as a whole, even if it basically works well. So do we really have a problem with people over 50 on the Swiss job market? Or might it be that for some of them the reasons lie elsewhere?

The facts

Before we answer this question, I would like to mention some facts in support of each viewpoint.

The evidence against a structural problem for people over 50:

  • In Switzerland the labour force participation rate for people over 50 is 80-81% (2019), which puts the country very high – fifth place – in the OECD ranking. In Europe, only Sweden ranks higher.
  • According to the von Rundstedt job market barometer, the termination rate in Switzerland for employees over 50 in 2019 was 31%, roughly the same as their 30% share of the working population. Thus their risk of losing a job was average. In contrast, for employees between 40 and 50 the termination rate was 42%, significantly higher than their 26% share of the working population.
  • According to SECO statistics, the unemployment rate in the over-50 age group in 2019 was roughly the same as the average rate for all ages. Among people over 50, 2.1% were registered as unemployed (total 2.3%). According to the ILO, the unemployment rate for people over 50 is 4%, which is also less than the overall average (4.4%), and the underemployment rate is 7.7%, which is slightly higher than the average (7.3%). Thus the combined underemployment and unemployment rate for this group is 11.7%, exactly the same as that for Switzerland as a whole.
  • On account of demographic change, the percentage of persons over 50 in the working population is rising in relation to other age groups. This means that if the unemployment rate remains the same, the absolute number of unemployed persons over 50 will increase, resulting in distorted perceptions of the situation.
  • Discussions in the press and in social media primarily focus on people who are immediately affected. The large silent majority without immediate difficulties on the job market does not participate to the same degree. This too leads to distorted perceptions.
  • The job market barometer issued by von Rundstedt shows that the average duration of job searches for persons over 50 is longer but that the variance is much greater. Thus many of these people need very little time to find a job.

The evidence confirming a structural problem for people over 50:

  • The labour force participation rate for persons aged 55 to 64 is 76%, well below that for persons 40 to 54 (91%).
  • The number of persons who have recently left the labour market is significantly higher in this group than for younger age groups (BFS statistics 2019).
  • The percentage of persons over 50 in the total of those who have left the labour market is above the general average. From 2002 to 2005, this percentage was less than 20%, but in the past 15 years it has steadily risen and is now over 30% (according to Amstat). This is higher than the age group’s share of the working population. What is most notable here is the trend. The steep rise in this figure during recent years is a clear sign of structural problems.
  • Job searches by persons over 50 definitely take longer than for younger persons. According to the von Rundstedt job market barometer for 2019, the average duration is 7.8 months, which is significantly longer than the overall figure of 5.8 months. The difference is increasing.
  • A survey of the HR community by HR Today Research in 2019 (1,575 participants) showed that the majority of HR managers think that employees over 50 are discriminated against when looking for work (72%). However, this figure should be viewed with caution because reports in the media can have a strong influence on perceptions. A more nuanced survey of the same target group in 2018 showed that HR managers generally believe there is such discrimination (81%) but that only a minority (33%) have observed it in their own business environment and can substantiate their feeling.
  • In our work with outplacement clients we have often observed groundless rejections of job applications submitted by older persons, even if the applicant’s career profile seemed perfect. Statistics also show that people over 50 receive more rejections than younger job seekers.

 

A personal assessment

There are good arguments on both sides. The picture that I get is one that is familiar to me from practical experience in career counselling, outplacement, new placement and organisational development. The ability to hold a job and to compete on the labour market does not depend on age alone. It does not even depend mainly on age. Age is just one of many factors that determine whether or not a skilled professional or manager can perform well in a company or successfully find new employment. However, it is clear that a correlation exists between age and these abilities. For this reason it is necessary to know the factors that can adversely affect an older person’s profile. These must be focused on as early as possible. Employers and employees have equal responsibility. On the one hand, it is too simple to cite age as the sole reason for an individual’s difficulties. On the other, companies have to become more aware of this issue and develop strategies to deal with age as a personal characteristic. This means finding strategies to help employees stay in the working world on a sustained basis. To make progress in this debate, we must not only heed the complaints of those who are immediately affected, we must pay even more attention to the silent majority of persons over 50 who at present do not feel discrimination. This is the only way to obtain a balanced picture that we all can learn from.

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