Pension problem effecting the job market?

[Dave Lenton]

Yesterday the Turner Report was published, addressing the growing pension crisis in the UK. The problem is basically twofold - people are living longer meaning that more retired people need to be supported, and people aren't saving enough to pay for their retirement.

The recommendation of the report was that people will have to work longer and/or pay more taxes in order to pay for increasing retired population. Given that medical advances will mean that people will increasingly live longer, its probable that we'll have to do both.

This could have large implications for the IT job market. There seems to be a bias against older programmers, and many companies look for younger people skilled in more recent technology. Unless a 60 year old programmer is very specialised in something important, it could be hard for them to get a programming job... let alone at 68 (when the Turner Report suggests we may still be working).

What do you think will happen? Will the IT sector begin to look less at age as the working age increases, or could a lot of "over the hill" developers struggle to get an IT job? If IT workers stay in the market for longer, this could also mean that there is more competition for jobs and less pay increases. Can the IT market grow enough to cater for an increased number of workers?

What about the situation in other countries? Are other countries facing a similar pension problem?

[David O'Meara]

Same issue in Australia. We also have the issue where many retirement places are already run down and the profit margins are too low for any real corporate help.

[Homer Phillips]

This could have large implications for the IT job market. There seems to be a bias against older programmers, and many companies look for younger people skilled in more recent technology.

Where do you find this bias against older workers?

Do you really think they are concerned with the more recent technology? Schools don't even teach that much technology do they. How much does a BS Comp Sci change in ten years? Add to that the ten-years-experienced has in the working world environment.

[Eric Lemaitre]

Hi Dave !

What about the situation in other countries? Are other countries facing a similar pension problem?

The very same in France, except it is probably the worst situation : the single pension deficit (not funded) for public servants alone is 900 billion euros, some U.S $ 1,000 billions which is almost half of whole country's debt (2,000 millions euros in all). Everyone there knows that both work length will have to much increase and pensions much decrease to avoid the whole system collapsing too quick.

Best regards.

[Eric Lemaitre]

Hi Homer !

Where do you find this bias against older workers?
Do you really think they are concerned with the more recent technology? Schools don't even teach that much technology do they. How much does a BS Comp Sci change in ten years? Add to that the ten-years-experienced has in the working world environment.

In France in particular, this situation is very true, up to a caricatural extent. From 40 onwards, especially in IT field where unemployment is twice higher than in other economic fields, finding a job becomes extremely difficult. One famous recent exemple is one french IT specialist in C++/Java/J2EE who worked in California, but found no job when he got back to France for at 36 he was seen as "too old" to do only technics. He had to leave IT to shift a complete reconversion in houshold construction. This case was reported in one of most famous french IT mag (01 Informatique) in an article entitled "at 40 an IT professional is not dead" (translated for ranchers, of course ).

The real root of this frantic run to IT youth is simply cheapness, young IT people are cheap, old ones are "expensive", so simple. As the end-user companies externalized much, keeping internally the smallest possible core of IT pros, they hardly ever hire so almost only bodyshopper consulting companies now hire to delegate their staff by them so as to make teams complete. As bodyshoppers are paid on delegation duration, they have no interest at all to hire the best to end the mission at quickest, on contrary, for the longer the delay the longer they remain paid. The best are generaly hired by startups after technical tests, but this vicious trend causes havoc in french IT specialists ranks : IT unemployment is declining swiftly, not because "old" IT people find a job, but because many shift to another economics field so as to find employment in another branch.

I won't be surprised at all the situation is quite similar in US, where a clear race to "cheapest whatever" through massive H1B plus both offsore and nearshore since 2002 seems to lead to the same trend, eliminating the oldest from 40 onwards as being "too expensive" while a wide pool of some ? 100,000 ? aliens a year (all H1B+L1+L2+J1+... visas altogether) allows a permanent flow of cheap young IT alien professionals, still claimed in greater numbers by industrial lobbies. But the very recent decision of US house of representatives to blast H1B abuses with severe restrictions and heavy fine on one such foul company (Computech in Michigan, a likely very first in US in years) might show an attempt to bust labour immigration abuses out, probably for pure political reasons but perhaps for ethical reasons too, who knows. Wait and see anyway...

Best regards.

[Dave Lenton]

Originally posted by Homer Phillips:

Where do you find this bias against older workers?

Well Eric pretty much summed it up:

Originally posted by Eric Lemaitre:

The real root of this frantic run to IT youth is simply cheapness, young IT people are cheap, old ones are "expensive", so simple.

As I'm not a wrinkly myself I don't have first hand experience of this, but I have heard from several people, and have seen in the media, that it is hard it is to hire a person (in the UK) for a technical IT position unless they are very specialised/experienced in a particular area. Most have to move into different areas (like management) or different sectors entirely as they get older.

Of course I could be wrong, and I hope so for my sake as I could well be a geriatric programmer one day! Maybe the situation is different in different countries.

[Homer Phillips]

So I take it you are in UK?

Are there any developers on your team that are 40+? If so, how many people are on your project?

A sample of one gets bigger if one can get more responses.

IMO, the pension or social security systems are driving jobs to off shore locations. In the US, social security adds about 15% to a workers pay. I don't believe the China or India adds this burden to their workers.

IMO

Age discrommination was a problem long before pensions or off-shoring were significant factors in the equation. I believe age discrimination is a world wide issue where employees have the right to change employers.

Employers hate to expend resourses on training. Experienced workers are a threat to managements ego. Experienced technical workers have learned that sucking it up for the company is often not rewarded. Then finally there are a whole bunch of people involved with hiring that cannot make an informed decision on technical issues. They hire on appearance and other signals that have no statistical validity in measuring a candidate's worth.

Younger appears to them to have the ability to work harder. But technologists aren't farmers or manual labors. Since younger wins out world-wide, IMO, age discrimination is geneticly encoded.
[ December 02, 2005: Message edited by: Homer Phillips ]

[Dave Lenton]

Originally posted by Homer Phillips:
So I take it you are in UK?

Are there any developers on your team that are 40+? If so, how many people are on your project?

Yeah, I'm in the UK. The whole IT department has about 35 people, and maybe 6 of them are 40+, so its a reasonably young group. Its not a traditional IT company though, so I don't know how representative of the industry it is.

IMO, the pension or social security systems are driving jobs to off shore locations. In the US, social security adds about 15% to a workers pay. I don't believe the China or India adds this burden to their workers.

This is possible, but there's probably other factors as well. The living costs are so much lower in China and India that they can afford to much less. Even if US companies stopped paying social security (and that's a whole other can of worms) the average wage for a US worker would probably still be higher then an Indian or Chinese worker in the same industry.

Age discrommination was a problem long before pensions or off-shoring were significant factors in the equation.

.... IMO, age discrimination is geneticly encoded.

I wonder if this could be a larger factor then most people realise. Maybe we're "hard wired" to have a tendency to see older people as not being as good because of a hang over from a primitive survival instinct. Hopefully people can get past this problem as the demographic in the West shifts towards an older population.

[Tim Holloway]

Originally posted by Dave Lenton:

I wonder if this could be a larger factor then most people realise. Maybe we're "hard wired" to have a tendency to see older people as not being as good because of a hang over from a primitive survival instinct. Hopefully people can get past this problem as the demographic in the West shifts towards an older population.

Oh? I'd always been led to believe that "in age lies wisdom". Meaning that the old folks were valued for their experience in things like knowing where to dig up food when the coldest Winter in 25 years arrived and how to handle babies with once-in-a-generation medical needs, etc.

It's only in modern times that experience has been prone to obsolescence.

[Homer Phillips]

It's only in modern times that experience has been prone to obsolescence.

According to some un-named expert, in the US job market as a whole, experience is seen as a good thing. I don't see it that way in math and science based careers though.