Aged care staff encouraged to plan for their financial futures

There are mutually beneficial opportunities available to aged care employees and employers that can help to make a positive difference to the retirement incomes of staff, writes Neil Saxton.

There are mutually beneficial opportunities available to aged care employees and employers that can help to make a positive difference to the superannuation balance staff, writes Neil Saxton.

Among those working in health and community services, aged care employees are the least prepared to retire. They typically having a super balance of just $18,000*, our latest research at HESTA shows.

The findings, released as part of HESTA’s Transforming Aged Care research report, show that aged care workers are also the oldest workforce in health and community services (HACS), with almost half over the age of 50.

Neil Saxton

The report draws on data and research from more than 200,000 HESTA members working in aged care with the aim of providing insights to help support the sector meet its workforce planning challenges.

Compared to other HACS workers, aged care employees over the age of 50 surveyed as part of this research were the most likely to say they need to keep working as long as possible due to concerns about having insufficient retirement savings.

There’s a complex range of reasons for the lower super account balances of aged care workers but the high proportion of casual and part-time working patterns, as well as typically lower wages certainly contribute to the lower super balances we see in the sector.

More than 68 per cent of aged care jobs are part-time or casual roles, the highest of any HACS segment, with 60 per cent of aged care workers earning less than $50,000 a year before tax.

About 82 per cent of members working in aged care are women so they are also impacted by some of the drivers of the gender super gap, which sees women retire with about half the super balance of men.

Gender pay inequity and women taking time out of the workforce to care for children and loved ones also contribute to the gender super gap. This is also a reason why women tend to experience greater vulnerability to poverty, particularly in their later years.

The research also found that aged care workers are looking to find ways to sustainably work as they age, to help them build their retirement savings.

This offers employers a real opportunity to open up a positive dialogue with their employees that can help them retain skilled and experienced workers.

The research shows that almost a quarter of the aged care workforce intend on leaving the sector in the next five years. This could result in a potential shortfall of 80,000 aged care workers right as the sector’s workforce needs to grow substantially to meet the expected demand from Australia’s ageing population.

When these employees leave they take their skills and experience with them. If we’re going to attract the number of new people we’re going to need to work in the sector, they need to see that there are career pathways and sustainable ways of working as they age.

Experienced staff members can be great champions for an employer in terms of attracting and retaining new talent.

The research included an in-depth survey examining the job intentions of around 2,000 HACS employees, including 500 from aged care.

Results found that the number one reason aged care workers are wanting to leave their jobs is to develop new skills, with nearly half (49 per cent) of those surveyed citing this reason for changing career or moving into other areas of HACS.

Although the research has found key reasons why aged care workers want to change jobs, it has also shone a light on some of the ways employers might attract and retain workers through training and education.

Employers that focused on quality education and training were found to be highly valued by aged care workers, with employees wanting greater learning opportunities and career progression.

One not-for-profit provider who was interviewed as part of the research revealed their oldest worker was aged 83, and had implemented a ‘Staying On’ program for people nearing retirement. Programs like these are one way employers can promote the wellbeing of their employees and demystify retirement.

We’ve found that people who are worried about their retirement can often feel isolated and unable to take steps towards ensuring a more stable financial future.

We have for many years run educational sessions and advice specifically tailored to help people in this situation, as we know it’s never too late for someone to make difference to their financial future.

Some employers interviewed in the research are building education sessions into their employee programs, as they recognise that financial concerns impact the overall wellbeing of employees.

It’s often hard for employees to talk about their retirement plans, and we have an education program designed to open up conversations so that employees can share their plans with colleagues and employers. We’ve found this can be really empowering as people don’t feel like they have to do it alone.

We also hold education sessions in workplaces around Australia and they are typically provided at no extra cost to employers whose employees are members of the fund.

*HESTA data March 2018.

 Neil Saxton is executive of partnership engagement at industry super fund HESTA.

This article appears in the current July-August edition of Australian Ageing Agenda magazine.

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Tags: hesta, Neil Saxton, superannuation, Transforming Aged Care, workforce,

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