Age Management of Industrial Workers Based on the Multiple Decrement Modelling

Abstract

Ageing of the workforce and early retirement of industrial workers is influencing a shortage of skilled workers in European industrial systems. Automatic adjustment mechanisms recently introduced in some of the EU member states will increase the retirement age of workers to 71 years until 2060. However, many industrial workers will not be fully productive to the extent of the increased retirement age. Therefore age-productivity profiles, which is an under-researched area, will be of crucial importance for organizations and national policy makers. In this paper, we present a multiple decrement model of workforce transitions and exits, related to age-productivity profiles of industrial workers. Based on this model, we present the calculation of the expected duration of working life and study the drivers that influence transitions among different states of productivity and exits from the workforce, which have not been developed yet. The workforce availability in ageing economies can be influenced by implementing appropriate age management practices, where workplace ergonomics and smart production cells are playing an increasingly important role. This paper introduces the expected duration of work-life based on an actuarial multi-state transition model as a measure of the quality of the organizational age management systems and serves as a policy tool for taking corrective actions at the organizational and national level. The numerical example is based on data from the Statistical office of the Republic of Slovenia.

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