Golden Finns and Golden Filipinos

Ah, Finland.

Land of Nokia; birthplace of Armi Kuusela (remember her?); the fastest aging developed country on the planet--and a shining example of how important "golden citizens" are to a country's economic growth.

Finland and the Philippines represent opposite sides of the workforce coin. In the Philippines, the country's slow growth is crimping employment, especially among elder citizens. Finland is also battling against slow growth, but one caused by an ageing society and a rapidly shrinking workforce.

Finland's problems with its graying workforce strike at the core of its economic status as a first world nation. The Finnish workforce is expected to plunge 40% by 2020--unless elderly workers are convinced to forego early retirement.

Since Finland's workforce stood at just 2.3 million persons in a population of 5.2 million (2004), the loss of over 900,000 workers in 14 years' time is bound to gag its economy.

Finland's solution to its crisis of gray was to urge its elder citizens to keep on working, a hard sell in a country where a Finn could chose early retirement when he hit 53.

But golden citizens were sold on the idea, thanks to government and private sector partnership in "age management" programs that sought to improve the health, productivity and motivation of older workers, and to generous incentive packages.

In 2005, Finland increased pension benefits by as much as 40% for citizens who delay retirement until 65 and beyond.

The success of the effort to check the shrinking of Finland's workforce can be gleaned from current data. Golden Finns from 55-64 years old now account for 50% of the workforce compared to 36% in the mid-1990s.

Finns now work until 59 compared to 57 in 1997. And most Finns expect to retire at 63.

The large number of employed elder Finns is also due, in part, to a law that compels private companies to shoulder the pensions of 50 to 64 year olds if an employee retires before he's 65.

Studies show that age management programs have increased the productivity of Golden Finns; reduced illness and increased motivation. Surprisingly, elder Finns have the lowest absentee rate among all workforce age groups.

Finland's experience proves that elder employees are as productive--or even more productive--than their younger counterparts. It also disproves the argument that it's good public policy to entice employees into early retirement so that younger persons get a shot at jobs.

Early retirement only forces younger workers to shoulder more of the financial burden needed to pay for the old age pensions and social security benefits of their elders. This wouldn't be necessary if elders kept on working.

The practice of keeping elder workers in the labor force is strong in employee-starved European countries. It is particularly widespread in the Nordic countries (Norway, Sweden, Denmark, Iceland and Finland), which are all struggling against shrinking labor pools.

But Finland isn't a big destination for Overseas Filipino Workers (OFWs). Not even 100 Filipinos were deployed to Finland from 1998 to 2004. Less than 2,000 OFWs went to the Nordic countries during the same period.

The Philippines' golden work force should be as "loved" as its Finnish equivalent. But with the Philippines' unemployment rate hovering from 7% to 10% and a huge labor force of 35 million persons, it's unlikely that Golden Filipinos will find renewed employment or government pampering easy to come by.

Today, however, it's Philippine call centers that want to hire Golden Filipinos. This for the simple reason that the English speaking pool of younger Filipinos is almost tapped out.

The booming business process outsourcing (BPO) industry might also need elder Filipinos. BPO demands skilled and experienced people to take charge of "backroom" business operations outsourced to the Philippines.

These backroom operations include finance, accounting, payroll processing, human resources, insurance, engineering, biotech, healthcare, multimedia, research and development, design and ICT.

The 40 operational BPOs provide administrative, finance and accounting services. These companies employed some 15,000 people in 2004 and earned revenues of US$100 million, according to the Board of Investments.