Pandemic affects 45 years old labor market re-entry - People over 45 are the ones who spend the most time unemployed and the ones who have the most difficulty re-entering the labor market due to the pandemic, according to a study.

Older workers are also the big losers of the pandemic. The current digitalization process, accelerated by the global pandemic, is a huge challenge for everyone, but especially for Generation X workers, that is, people born between 1970 and 1980. According to a study, the vast majority of the long-term unemployed belong to this age group, between 45 and 60 years.

In this sense, the most vulnerable workers are those seeking basic or intermediate jobs. The main reason that this social group is on average the one that spends the most time unemployed, is age discrimination, according to the study of Generation, a non-profit organization that investigates labor insertion at different ages.

One of the conclusions is this age discrimination bias that the HR teams of many companies have. "Our research confirms that hiring managers have a strong perception bias against candidates over the age of 45: they believe that members of this age range have few skills and little adaptability,” the study says.

The report was prepared between March and May 2021, has 3,800 participants between 18 and 60 years, both unemployed and working, and 1,400 participants in the position of human resources managers. In addition, participants are from Brazil, India, Italy, Singapore, Spain, the United Kingdom and the United States.

Pandemic affects 45 years old labor market re-entry

Age discrimination is mainly experienced by younger and older social groups. According to the World Health Organization, age discrimination has serious consequences for the health of individuals. Among older people, this discrimination is associated with poorer physical and mental health, greater social isolation and loneliness, greater economic insecurity and a lower quality of life. In fact, WHO states that 6.3 million cases of depression worldwide are attributable to age discrimination.

” This is an absolutely needy demographic and it is very clear that, once you reach a certain age, it is much more difficult to access a job opportunity, " Mona Mourshed, CEO of Generation told CNBC.

This discrimination related to age and the world of work results in the data analyzed by the organization Generation in its study. As the researchers state, there is strong evidence of age discrimination, as there is a negative perception of people over 45 years of age by those responsible for hiring, even when they are the same age as the candidates.

The favorite candidates are those between the ages of 35 and 44.

Among the main causes of the lack of hiring of this age group, there are 3 characteristics that are repeated in the study by human resources managers; greater reluctance of this age group to try new technologies, inability to learn new skills, and the difficulty to work with colleagues from a different generation.

Pandemic affects 45 years old labor market re-entry

However, if these same people in charge of hiring are asked about the work performance of workers hired in their companies over 45 years old, the answers tell a different story than their fears about new hires.

According to the study, HR managers say that 87% of their hires over 45 years, are as good —or even better—, than their younger colleagues.

In Spain, the situation is very similar to the other countries in the study. In fact, one of the final conclusions of this study is that the difficulties faced by workers over the age of 45 are global and consistent in the long term.

In our country, 33 per cent of young people aged 18 to 34 who are unemployed remain unemployed after 12 months. In the 35-44 age group, the percentage increases to 49%. Those over 45 years of age are the worst affected and almost 70% remain unemployed after 12 months.

This situation is very similar to that of Italy and the United Kingdom, the only European countries together with Spain participating in the study.

Pandemic affects 45 years old labor market re-entry

The CEO of Generation, Mona Mourshed, gave some keys to the CNBC to stop this phenomenon that the WHO defines as”a global challenge". The solution, according to Moursehd, is education and continuous training, as well as breaking mental barriers to people of a certain age.

“We must link training programmes directly to employment opportunities and provide stipends to support workers aged 45 and over who are hesitant to participate in training. In addition, we must change hiring practices to reduce potential age bias and better assess the potential of candidates for a job over 45 years old through skill-based exercises.”

” Considering that we are in 2021, intergenerational templates must be a reality that all companies try to implement, " Mourshed emphasizes at CNBC.

Pandemic affects 45 years old labor market re-entry

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Mango sells 21% more until June and expects to exceed this year the record figures of 2019

Mango has closed the semester with sales growth of 21% compared to 2020. This growth has led the Catalan company to review the forecasts upwards and estimate to exceed the profit obtained in 2019, when the company reached 41 million, after reaching a turnover of 2,374 million euros, the highest in its history.

In fact, Mango, chaired by Isak Andic, has closed the months of May and June with sales at a constant rate higher than those of 2 years ago, before the outbreak of the pandemic. During this period, the commercial margin has also improved by 1.8 points compared to 2019, standing above 58%. This increase has been due to the improvement of the collection, the proactive management of stocks and the lower weight of the sale with promotion.

“The results achieved so far this year make us optimistic for the second half, in which we expect a recovery in sales above the figures of 2019. We expect to see benefits again this exercise”, explained Toni Ruiz, CEO of Mango.

The Mango fashion group closed a 2020 complex with a turnover of 1,842 million euros, which meant talking about a reduction of 22% compared to the same period last year. The worst part was taken by physical commerce due to restrictions to contain the virus. Turnover fell 43%.

In fact, the park of physical stores has been closed an average of about 50 days in this first half of the year, with special impact in key countries for the multinational such as Germany, France, United Kingdom, Portugal or Turkey. There have also been considerable restrictions on opening and capacity in Spain, the first market in Mango turnover.

Much of this growth rate is captained by the online channel. E-commerce has closed this semester with an increase of 37% over the same period last year and is 85% above 2019. The weight of the digital channel on the total turnover of Mango represents 46%, 4 points more than at the end of December 31.

With all this, the company maintains its ambitious goal of ending the year with an online turnover of 1,000 million euros. In the last results of Mango, corresponding to 2020, online already contributed 766 of the 1,842 million euros in turnover. That is, 42% of the income.

Today, the e-commerce of the Catalan company is available in 85 countries on 5 continents. At the end of 2020, more than 260 employees worked in this division, 30% more than the previous year and a figure that reflects the growing role played by the online channel.

Despite the strong growth of the online channel, Mango is clear: "We do not understand the future of fashion without the physical channel", explained Elena Carasso, director of the group's digital channel. Under this premise, the chain added 43 points of sale to its network in 2020 and had the intention of renovating 800 establishments in 3 years, marking distances with the withdrawal in the streets of Inditex or H&M.