Old, Employed and Injured: Part 1

We cover the issues our aging workforce creates for employers and their workers' compensation programs--though not safety or productivity, mind you.

By Mark Noonan

As we all know from watching our children (and grandchildren) grow, we are not getting any younger. Neither is our workforce as we continue to fight through this economic recession. One may believe that older workers have a negative effect on productivity and safety, but it is just the opposite.

Older workers are more productive and have an overall higher workplace safety. According to the Bureau of Labor Statistics (BLS), productivity increases as the percentage of over-55 workers increases, while the accident frequency in the older demographic declines.

Teacher's failure to show prosthesis was replaced blocks benefits (03/08/12)
Lack of causation strikes compensation for carpenter's infection (07/02/12)
Delay in treatment did not show store fraudulently concealed injury (08/01/11)
Hospital's failure to provide care permits assistant to change doctors (08/18/11)
Unusual parking lot incident doesn't score benefits for guard (07/05/11)

The BLS also reports that 41 percent of the overall number of work-related injury claims recorded annually come from new employees (i.e., on the job for a year or less). The National Institute for Occupational Safety and Health reports that younger workers (i.e., under the age of 24) are two times more likely than their older co-workers to be injured.

The catch for employers, however, comes into play when these older workers get injured.

RECOVERY: YOUNGER VS. OLDER WORKERS

For older workers, it takes approximately two to three times longer to recover from an injury than a younger worker, says the BLS. A recent National Council on Compensation Insurance (NCCI) study found that claims costs for workers aged 55 to 64 are generally 64 percent higher for indemnity claims and 40 percent higher for medical claims (compared with workers aged 20 to 24). Claims costs and days away from work are directly related. For injuries and illnesses, the BLS reports, for workers aged 65 and older the median days away from work is 15 days. For workers aged 16 to 24, however, the median is 4 days.

While older workers (here defined as 64 or older) have the lowest number of workplace injuries, according to the Department of Labor (DOL), the fatality rate for older workers is higher than any other age group and is more than three times the rate of fatalities for workers age 25 to 34. The DOL reports that most fatalities were from transportation-related accidents, falls or being struck by an object. (For all injuries, per the NCCI, falls, slips and trips were the greatest cause for older workers.)

BEFORE IT'S TOO LATE

Employers must address these health and safety issues for older workers simply because there is and will be more and more of them in the workforce.

According to the BLS, the number of people 65 and older in the workforce has increased more than 100 percent since 1977. This number will continue to grow until 2016 when it is expected that workers aged 65 and older will then account for 6.1 percent of the total workforce (compared with 3.6 percent in 2006). By 2025, the BLS predicts, the number of older workers will reach 20 percent. The most dramatic increase (80 percent) will be seen in the oldest groups--workers between 65 and 74 and workers 75 and up. Older workers will also be working longer schedules. More than half of all older workers now work full-time, which is up 44 percent since 1995, according to BLS data.

A variety of economic hardships are influencing and changing the age of the workforce. We no longer work for one employer our entire career and then take the company pension. Many employers have terminated or stopped funding defined benefit retirement programs entirely. From the economy deflating the value of 401(k) programs to employees having children (and college bills) later in life, people simply cannot retire, lay back and enjoy their "golden years."

According to a 2008 survey by AARP, one in five people between the ages of 55 and 64, and one in four between 45 and 54, plan to delay their retirement due to the economic turndown.

Employers need to plan and prepare for this expected growth in the labor market. Employers can start by revisiting job descriptions and knowing every detail each work task entails in order to help prevent costly and unnecessary workers' compensation claims. Meanwhile, they should continue to promote health and wellness programs for all employees.

Because older workers bring many benefits, from their experience and knowledge to their motivation and good work ethic, the advantages of employing older workers will outweigh the possible workers' compensation claims, with preparation and planning.

(Editor's note: In part two of this series, Mark will cover the steps employers can take to lessen the impact of older workers on their workers' compensation program.)

MARK NOONAN is a managing principal and the senior knowledge manager for workers' compensation for the Casualty Practice within Integro Insurance Brokers.

Read more at the WorkersComp Forum homepage.

September 9, 2010

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