Pandemic’s financial havoc spells longer working lives: Gratton

TOKYO — The coronavirus pandemic has made the issue of longevity even more relevant given that the damage to financial markets could force people into longer working lives, Lynda Gratton, a leading expert on human resources and organizational behavior, tells Nikkei.

She also expects more flexible work patterns to emerge now that people have broken the norm of working eight hours a day, five days a week, by adopting teleworking.

“Executives should be preparing now to experiment with four-day working weeks,” she says.

Gratton, a professor of business management at London Business School, serves as a member of Japanese Prime Minister Shinzo Abe’s council on social change. Her 2016 book “The 100-Year Life,” co-authored with Andrew Scott, examines the question of how social systems and the structure of life need to evolve in an era of growing longevity.

Edited excerpts from the interview follow.

Q: The global spread of the coronavirus is expected to affect life expectancy. Do you think that the premise of “The 100-Year Life” needs to be changed?

A: It is unlikely that decades of progress in terms of increasing life expectancy will be washed away by the coronavirus.

The longevity agenda we described at the heart of “The 100 Year Life” remains. We pointed to the significant gap between social structures and work practices and individuals’ life expectancy that has accumulated over the decades. That gap is still there between how we each plan our life and how we long we now have to live.

In fact, the likely impact of coronavirus on the current and future performance of financial markets and rates of return means that many more people now face the prospect of even longer working lives.

Q: When we look at the impact of the coronavirus on elderly people, we can’t help but think about the negative aspects of aging, not only for individuals but also for society. How can we switch our mindset to a positive one?

A: Coronavirus is accelerating many issues of an aging society and longevity. It is also revealing deep confusions about “aging” and “old.” The danger is that because the fatality rates of coronavirus are so much greater for older people, this will reinforce negative stereotypes. However, it is possible that this is the start of a new debate that updates our concepts of aging.

Key to the longevity agenda is the idea that age is “malleable” — in the sense that it can be affected by individual actions and environment and by government policy. As a result, how old you are in years may not be a good measure of how old you are biologically. So whilst the coronavirus is most dangerous for the elderly, the link between age and morbidity is heavily affected by underlying health conditions.

What is ever more apparent is that the more you take steps to improve how you age, the better your resilience in the face of future shocks.

It would also be wise to shift the debate beyond a simple distinction of “young” and “old” and recognize that as life lengthens, this distinction becomes less important.

As an illustration, in 1947 a 20-year-old in Japan could expect to live to the age of 63. By 2018, under conservative assumptions, that expectation is now 85 years. That means that a “young” 20-year-old today has a much greater chance of being “old.” Therefore, they should be much more interested in how society treats older people in response to a once-in-50-year pandemic.

Q: How will the coronavirus change how the way people work?

A: The coronavirus will accelerate some latent trends in how, where and why we work. It is clear that we are all a great deal more confident in virtual working.

As one Chinese businessman said to us in early March over a video link: “In the pre-pandemic world,” he noted, “I used to travel between Hong Kong and Beijing once a week for a couple of meetings. Now I find I can do 4 or 5 meetings a day — my productivity has significantly increased.” After China gets back to normal will he still fly every week? I doubt it.

We also expect the patterns of work to become a great deal more flexible. We’ve learned to manage our new daily routines by coordinating closely with colleagues and building in time flexibility. We’ve eased the stress of managing multiple boundaries between home and work with short-term tactics like creating blocks of time. These new capabilities to manage time and resources are fast morphing into the foundation for crafting new ways of working.

In doing so, we’ve inevitably broken the norm of working eight hours a day, five days a week. Will we move swiftly back to this traditional time model? We doubt it, and executives should be preparing now to experiment with four-day working weeks and to accommodate more employees who ask to work late in the evening (or very early in the morning) instead of 9-5.

The economic shock of coronavirus will inevitably lead to a surge in unemployment and accelerate automation. Not all those jobs will come back as whole sectors and specific jobs disappear for a long period of time. So the new agenda will be about upskilling, particularly in digital skill, but also importantly about reskilling — investing in new skills to shift into jobs with better prospects.

Q: Do you think it makes more sense now than ever to have a buffer for financial preparedness? Are liquidity and efforts to maintain employment the right way to think about resilience?

A: Financial liquidity is an important way in which companies and individuals can buy themselves time in the face of negative shocks such as the coronavirus. However, it is important to realize that liquidity simply acts as a buffer and helps provide a short-term window of support. In the longer term, ultimately it is resilience that is crucial.

Resilience is built through flexibility — both in corporate actions and resources, and in individual skills and priorities. The capacity to respond to shocks by adjusting individual plans, focusing on new markets or learning valuable new skills is the foundation of resilience.

And looking ahead, the coronavirus is not the only exponential curve that threatens the performance of firms and or the livelihood of people. In the coming years we will all be faced with significant challenges in the form of the impact of technologies such as [artificial intelligence] and robotics, the issues of an aging society and the concerns about climate change.

What we can learn from this crisis is the need to be prepared, to anticipate ahead, and to be flexible in our response.

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