INTRODUCTION
It is common knowledge that changing demographics have resulted in ageing populations in many developed as well as developing countries including India (Asia, 2006). The pending retirement of the baby-boomer generation will strip the workforce of massive numbers of experienced workers, not only will many organisations encounter a shortage of skilled employees, they will face also a problem of knowledge management deficiency. Many scholars demonstrated that population ageing is viewed by policy actors as a crisis that has the potential to threaten our economic and social stability, especially with fewer people working and paying taxes (Morden, 2000; Encel et. al, 2004, 1996; Krenn & Oehlike, 2001, Cooke, 2003; Wagner, 2004; Ray, 2004; and James, 2004).
The Indian aged population is currently the second largest in the world. The absolute number of population the over the age of 60 in India will increase from 76 million in 2001 to 137 million by 2021. The gradual rise in the elderly population in India, from 5.4 percent in 1951, the proportion of 60+ people grew to 6.4 per cent in 1981, 8.1 per cent in 2001and is projected to be close to 12.5 per cent in 2010. The decadal percent growth in the elderly population for the period 1991-2001 would be close to 40, more than double the rate of increase for the general population (Indian census, 2001). The older population of India, which was 56.7 million in 1991, is 72 million in 2001 and is expected to grow to 137 million by 2021 ( Indira , 1999; Rao,2003). Today, India is home to one out of every ten senior citizens of the world. Both the absolute and relative size of the population of the elderly in India will gain in
Address correspondence to Mohinder Chand: Department of Tourism and Hotel Management Kurukshetra University, Kurukshetra, India. E-mail: mohinderchand@rediffmail.com
India will gain in strength in future. The composition of aging workforce in Indian industries has been rapidly increasing over the last decade. Thus, it has become imperative for the management to adapt best HRM strategies to deal with this crucial challenge for the betterment of organisation.
Generally, the nature of the age management issues facing a sector depends on factors like the average size of firms, the age and skills profile of the workforce, and future expectations of growth or contraction (Watson, 2006). Hospitality (the sector defined statistically as "hotels ,resorts, restaurants, travel agency , tour operators and others involved in hospitality services") employs 12.6 million people (5 % of the national workforce), and produces 5% of total output (Ministry of Tourism, 2006). In addition to hotels and restaurants, its 130,000 firms include camping sites, self catering accommodation, take away food shops, bars, pubs and clubs, canteens and catering ((FHRAI, 2006). Half the workforce works in "elementary" roles. The output in hospitality is growing in line with the rest of the economy, and the number of firms is also growing, although the turnover in firms is very high with 15% of all firms less than a year old (FHRAI, 2006). Employment in the sector is expected to expand, mainly among managers and elementary occupations. Because of high labour turnover the sector expects to need an additional 850,000 people by 2014 (equivalent to 70% of the current workforce) (Ministry of Tourism, 2006). This is a sector of smaller firms, with a very high proportion employing 11-49 people, and a very young workforce. About half of all firms have some form of business planning. Hospitality has a higher proportion of young employees than any other sector, and is much less likely to employ people over 55. Employees are also much more likely to be part time, female, and from ethnic minority groups and also two thirds have qualifications below Level 3 (Smith & Ingram, 2000; Cober et. al, 2000 and Hansruedi, 2001). In occupational terms, the workforce is sharply divided between half who are in elementary occupations and a fifth in managerial roles.
The hospitality sector has much more serious problems of labour supply than the economy as a whole, perhaps as a result of the youth and high turnover of the workforce has made this industry to think about the aging workforce (FHRAI, 2007; Wood, 1999). Many hospitality firms are facing the problems like Skill shortage vacancies, Internal skills gaps (where current employees Lack necessary skills for the job) affecting a large proportion of the current workforce. These problems affect all occupational groups, but are especially severe among elementary occupations, where all skills problem levels are more than three times the national average. In managerial occupational are the firms demanding more conceptual and managerial skills however many firms facing this as serious deficiency (Mohinder, 2001; Nankernis & Debrah, 1995). This suggests a sector with real recruitment difficulties, and/or uncompetitive levels of reward in a tight labour market. Despite the evidence of skills problems, levels of training are below average in most of organisations although the proportion of staff which receive some managerial training in a year is higher than average (probably reflecting statutory requirements combined with high turnover). It has been found that many firms are as likely to plan for training for workers but are less likely to have a training budget, and have no formal skills planning of any kind (Stephen & Matt, 2006; Remery et.al, 2003; and Mohinder, 2004). Obviously, the efficient HRM strategies will be the single answer to many problems of ageing workforce in the hospitality industry.
The purpose of this study is to explore some of the best HRM strategies likely to enable hospitality firms to manage aging workforce and to examine significant differences between Travel trade firms and Accommodation firms on HRM Strategies employed for managing aging workforce.
REVIEW OF LITERATURE
Research on aging workforce in hospitality industry has been limited by a paucity of primary and secondary data and by the challenges that the diversity of hospitality organisations present. Despite the large numbers of such business, it is only in recent years that hospitality firms have started to attract attention from researches and a small but growing literature dealing with the characteristics and needs of this sector has emerged. Much of the research on hospitality firms has been carried out in European and American hospitality. The review of literature in the present context has been divided into two parts - Ageing workforce and HRM strategies.
Relating to Aging Workforce
Many studies found that western countries face the challenge of a rapidly ageing workforce, while the majority of Asian economies, with the exception of Japan, have yet to confront the full implications of an ageing population and its potential impact on workforce management (Li ,1998; Rosario,1994; Woon ,1994; Yoon & Eun, 1995).
Tonette S. R., David S. & Chan L. (2003) opine that older workers are a differentiated employee group with different workplace issues. They suggests a new conceptualization of the workspace as a field of interacting forces in which the older workers' decisions to remain, return, retire, or renew the work contract is moderated by organizational decisions to retain, retrain, recruit, or redesign the work contract for older workers.
Margaret (2000) considers some emergent problems Asian companies will need to address as their workforces continue to age. Human resource management practices will need to be adapted to ensure the skill levels of older workers are continually updated and that discrimination is not condoned. In many Asian countries policies are being developed and legislation enacted to protect older workers from age discrimination, and provide income support for those no longer able to find and maintain employment. Yet in Japan, where the numbers of ageing citizens exceed those of its child population, HR policies aimed to protect older employees are often circumvented in practice, and few other Asian countries enforce their anti-discrimination rules.
Graham and Kate (2005) demonstrate that SMEs which take a strategic approach to training and development of their human resources will profit not only from a competitive position in their marketplace but also be well placed to adjust to changing and often uncertain external influences on the business environment presented to organisations in the twenty-first century.
Libby (2003), focuses on the global trend of an ageing workforce and government policy directions towards reversing early retirement trends raises the issue of the costs to employers of an older workforce. The study found that net benefits occurred through recruitment and training benefits over the costs of absenteeism and work injuries. Further non-quantified benefits of older workers identified in international case studies are also explained. These quantified and non-quantified benefits of older workers suggest that identified positive inducements to employers exist which support human resources investments in older workers.
Trude and Reidar (2005) investigate how managers direct issues of an ageing workforce, and whether this has implications for the hospitality industry. Managers' experiences with managing age-mixed workforces are outlined, and implications of an ageing workforce for the hospitality industry are discussed. Results indicated that managers have more positive than negative experiences with balancing the workforce with younger and older workers. No explicit age-barriers were found in recruitment, but few managers planned to actively recruit older workers. Training programmes were not designed specially for older workers. Flexible working practices are difficult to organize in hospitality jobs. Further, the study indicated that there are positive outcomes of creating age-balanced workforces in the hospitality industry, because younger and older workers complement each other. No overt negative attitudes towards seniors were expressed, and older managers seemed to be more positive
towards older workers.
Anitha and Raj (2001) state that India, like many other developing countries in the world, is presently witnessing rapid ageing of its population. Almost eight out of 10 older people in India live in rural areas. Urbanisation, modernisation and globalisation have led to changes in economic structure, erosion of societal values and the weakening of social institutions such as the joint family. They explore the nature and extent of the social and economic pressures that are impinging on intergenerational relationships and discuss the implications for policy towards improving the wellbeing of India's senior citizens.
Scott and Janice (2007) say that global demographic shifts give rise to an aging workforce, yet social barriers hinder employment and effective management of older workers. Sports organisations in particular would benefit from age diversity and inclusive cultures, as older workers who identify with organisational values are well-suited for interacting successfully with customers. From a survey of front-line service employees in five US Major League Baseball (MLB) clubs, they found significant relationships between aging, organisational identification, and customer service. They offer explanations why older employees choose to work for sports organisations and discuss ideas for building cultural diversity and customer relationships through a mixed-age workforce.
Price et.al. (2007) identify potential strategies derived from the literature that could be adopted to retain an existing ageing workforce. They examined a public sector organisation with an ageing workforce, to assess which strategies have been adopted and to begin to assess how effective these strategies are. They found that the case study organisation adopts many of the HR strategies suggested in the literature, but their preliminary findings suggest that these policies are unlikely to have a positive effect on the retention of ageing workers unless the employees are actively encouraged to use the policies.
Relating to HRM Strategy
According to Dessler (2000) the term HRM strategies refer to the specific HR courses of action the company uses to achieve its aims. HRM strategy like production, marketing and finance is a functional strategy. In fact, the overall HRM strategy of a company is composed of a range of strategies. It is because a company formulates a specific HR strategy pertaining to a specific HR function. Price (1997) opines that HRM strategies combine all people management activities into an organized and integrated program to meet the strategic objectives of an enterprise. Similarly Tyson (1995) defines HRM strategy is the set of ideas, policies and practices which management adopt in order to achieve a people-management objective. Some authors conceptualize HRM strategy as an outcome: 'the pattern of decisions regarding the policies and practices associated with the HR system.' From this point of view, there can be as many HRM strategies as many HR functions are there. Available literature on HRM suggests numerous HR practices such as Devanna et al. (1995), suggests five; Schuler & Jackson (1987), mention six HR practices; Milkovich & Glueck (1985), identified five functions\practices of HRM; Heneman et al. (1996), classified the functions of human resource management into five categories; in the opinion of Decenzo & Robbins (1999), human resource management consists of four basic functions; Dessler (2000), identified ten such practices of human resource management; and Michael Jucius (1978), classifies the HR functions into four broad types.
Rao (1999) states that to create corporate advantage an organisation has to work on improving core competencies such as restructuring, learning, and a multitude of paradigms. Satyanarayan (1999) is of the opinion that HRM creates value for its employees who in return are expected to create value for customers and owners. He further stated that HRM strategies play a crucial role in managing change, managing culture, learning organisation, and organisational restructuring. Shastry (1999) forecastes that the 21st century is fraught with uncertainties and challenges, which are driving the industry to adopt new HRM strategies. In the similar vein Patnaik (1999) has urged for redefining the HR managers' role and aligning HR strategies with the organisational strategy. Mohinder (2001) in an investigation found that medium scale travel/tour enterprises have taken bold steps to improve and develop their HR practices. Further, he described that these organisations have achieved integration between their HR policy and business strategy.
The application of HRM strategies at first hint at a lack of strategic considerations in general ( Liff, 1997; West & Berman ,2001) in recruiting ( Cober et.al., 2000) and in learning (Beamish et al.,2002; Walle-Strand and Thune,2003). Somewhat differing, a case study shows that two out of five major organizations do have a clearly defined HRM strategy while the other organizations at least had ideas about general objectives, but the link to HRM and the overall HRM strategy was less clear. Within the same study, the crucial role of strategy for success is accentuated (Ruel et. al., 2004). Another case study again reports the incorporation of HR portal implementation into an overall business strategy, emphasizing the crucial role of comprehensive and carefully planned change management activities to gain acceptance of employees and promote the actual usage of the portal (Ruta, 2005). Though there are some further hints that additionally point out the importance of thorough implementation the process of strategy implementation has not been thoroughly investigated at present.
Different firms place different emphases on the various HR strategies. It is difficult to generalize about the range of HRM functions and activities performed in an entity. Keeping the theoretical divergence on HR functions aside, this study will confine on the strategic aspects of twelve key and common HRM strategies: Workforce Planning Strategies; Recruitment & Selection Strategies; Work-life Balance & Flexible Work Practices; Career Planning & Development Strategies; Retirement & Pensions Strategies; Knowledge Management Strategies; Training & Retraining Strategies; Performance Management Strategies; Maintaining & Retention Strategies; Pay pPckage (compensation); Health and Safety Strategies and Work Environment Strategies/Evolution of Social Behaviour .
To sum up, current knowledge concerning the mere existence of HRM strategies and their implementation for the management of aging workforce is scarce and somewhat ambiguous. Other central aspects of strategy like types, contents or consequences are currently simply not addressed.
RESEARCH METHODS
The survey sought to encompass a wide range of hospitality firms involved in tourism and hotel business activities and comparative in its approach, depicting possible differences between the wide ranges of firms involved as regional variations. In June 2005, 750 hospitality firms were identified as potential participants. A structured questionnaire was e-mailed to all respondents. During the period respondents were contacted (e-mail) many times, this most probably improved the response rate as well as efficient; almost one third (33.34 per cent) of those hospitality firms targeted in the research returned fully usable questionnaires. The final structure of the respondents in survey is presented in table 1. Participants in this study were asked to rate the importance of each of the 12 (HRM Strategies) variables (Table 3) on 5-point Likert scale. A rating of 1 indicated that the item is not important and rating 5 is used to denote that the item is substantially important. In order to validate the research instrument, the questionnaire was tested for clarity and length by administering it to a sample of hospitality firms. Through the use of the respondent's comments and suggestions, the research instrument was revised to its updated form used for this study.
The data were analysed using SPSS Ver. 8.0 the results were examined along a number of dimensions: mean value of individual item importance and differences between travel trade firms and accommodation firms.
Table 1. Survey Sample
| Types of operation | N | Percent |
|---|---|---|
| Travel agency | 50 | 20 |
| Tour operators | 55 | 22 |
| Hotels | 60 | 24 |
| Motels | 15 | 06 |
| Transport operators | 20 | 08 |
| Restaurants | 25 | 10 |
| Local operators | 15 | 06 |
| Others ( related with hospitality activities ) | 10 | 04 |
| Total | 250 | 100 |
RESULTS AND DISCUSSION
Company attributers
The company attributes are displayed in Table 2. The majority of participating hotel companies was 4 star hotels (47%) and more than 30 % of the hotels were established in less than 10 years. Regarding the scale of the business, 40 % of the hotels were large organisations with more than 75 million in operating capital; and 45% had less than 50 employees. Nearly 70 % of the hotels were individual enterprises. On the other side most of the travel trade organisations were medium scale travel agencies and tour operator (49%) and having more than 10 year in the business. The capital structure of 50% travel trade organisations was 30-50 million and had bank loan main source of its capital. Majority of hospitality firms were employed part-time workforce. The annual turnover varied greatly across the sectors. The average turnover was just over 30-50 million.
Table 2. Hospitality firms business profile
| VARIABLES | (%) | ||
|---|---|---|---|
| Legal Ownership Family trust Sole trader Partnership Company (ltd.) Others( not registered) | 1.5 10.5 38.6 42.4 7.0 | ||
| Age of operation (years) less than 5 6-10 11-15 16-20 more than 21 | 34.7 30.3 17.6 13.4 4.0 | ||
| Capital (million) less than 30 30-50 51-80 81-100 101 and over | 8.3 21.7 41.7 15.8 12.5 | ||
| Source of Capital (start-up base) Personal \ family saving Bank loan Government grant Financial Institutions Loan. Others. | 5.4 41.5 3.7 32.9 16.5 | ||
| Firm size (Employee numbers) 1-5 6- 10 11-15 16-20 21-25 26 and over | Full- time 3.6 7.6 32.3 13.5 20.1 22.9 | Part- time 1.3 14.7 25.7 25.9 11.2 21.2 | |
| Annual turnover (millions) less than 30 30-50 51-80 81-100 101 and over | 35.6 24.9 23.5 9.7 6.3 | ||
(N=250)
Table 3 lists the most important HRM strategies that Indian hospitality firms consider significant for managing the aging workforce. Utilising Friedman's non- parametric test, significant difference were identified in the way respondents ranked the items (p<.001).
Table 3. The relative importance of various HRM Strategies employed by Indian hospitality firms for managing aging workforce
| Variables | Mean | SD |
|---|---|---|
| Workforce planning strategies | 5.99 | 1.09 |
| Recruitment & selection strategies | 5.89 | 1.31 |
| Work-life balance & flexible work practices | 5.74. | 1.01 |
| Career planning & development strategies | 5.52 | 1.43 |
| Retirement & pensions strategies | 5.64 | 0.87 |
| Knowledge management strategies | 5.41 | 1.23 |
| Training & retraining strategies | 5.36 | 1.37 |
| Performance management strategies | 5.38 | 1.09 |
| Maintaining & retention strategies | 5.28 | 1.35 |
| Pay package ( compensation) | 5.23 | 1.40 |
| Health and safety strategies | 5.20 | 1.30 |
| Work environment strategies/evolution of social behaviour | 5.03 | 1.47 |
(Chi-square= 43.86, p<.001)
Survey results show that work-life balance and flexible work practices are seen as the most important variables for respondents in managing an ageing workforce, and remuneration the least important . Health and safety was described as important variables by less than half of the respondents - possibly because of the general nature of work expected of older workers in the hospitality service. In some cases, work may require a level of physical and psychological exertion for which older workers may not be readily considered such as front office. Several departments also identified retention of institutional knowledge in the absence of a proper documents and records management system as relevant in managing an ageing workforce. Finally, performance management was also seen as important - possibly because of the difficulties managers increasingly face in 'performance managing' older workers (e.g., some described 'encouraging' them to retire because their performance was not up to expectations, and where other remedies had failed).
The HRM strategies from survey results are interlinked. For example, flexible work practices are linked to retirement and pensions, and career planning and development; recruitment and retention to workforce planning; retirement and pensions to wage levels/remuneration; and training and retraining to the increasing use of technology. So, all HRM strategies must be considered together when trying to understand how to manage an ageing workforce. It has also found that all departments within the hospitality firm apply the same standards to both older workers and younger ones, and some do not see the need for a separate stream of work targeted towards managing an ageing workforce. Even many respondents clearly stated that "they have only just begun to discuss this issue". However, on an average 60 % respondents were taking steps to manage an ageing workforce.
More that 56 % respondents were taking a fresh look at how the changing age profile of their organisations may affect future recruitment and workforce management; considering revising workforce capability plans; and revising departmental strategies in line with the 'positive ageing strategy' principles. In fact, hospitality firms tended to adopt a more formal approach to workforce planning.
The results indicate that most of the respondents are refocusing the department's attention on growing capability by introducing new career development schemes aimed at attracting/retaining workers of all ages; and paying a retirement savings allowance to all staff members so that they can contribute to a superannuation scheme.
A flexible working arrangement is appreciated as a magnetic force to retain and attract the young blood in the organisation. The results reveals that 35 % hospitality firms have making job sharing and part-time positions available to older workers; providing remote access to allow people to work from home; considering phased retirement as part of the flexible working policy and work-life balance programme; and downshifting (i.e., moving from a higher level job to a lower level one). The results show that 62 % hospitality firms have re-degined their Career planning and development strategies for retaining older workers as mentors after they leave the organisation; offering retirement seminars and similar services to workers (including seminars in budgeting, financial planning, and career planning); and seconding older staff members, who generally have more experience, to other organisations.
Further, the results indicate more than 50 % respondents are putting in place a comprehensive health and safety framework that caters to all staff, but particularly older workers; offering sick leave as required; and partial subsidy for spectacles for visual changes.
Utilising Friedman's non-parametric test, the mean and SD for travel trade firms and accommodation firms are shown in table 4. For travel trade firms Chi-square= 120.60, P<.001; for accommodation firms Chi-square= 56.96, P<.001;
Table 4 shows the average responses of the travel trade firms and accommodation firms and the results of t-tests comparing the two group's mean responses. As can be seen from the table, statistically significant differences may be found (at the .01 level of significance) on twelve of the Likert –type statements. The accommodation firms showed a strong level of agreement with the HR strategies statements that might be considered as significant for the managing aging workforce in the hotel industry, while respondents from travel trade sector showed a slight level of disagreement, a perceptual difference which was significant. Whilst the mean of importance have been established for each firm, it would be useful to know where the mean rating for the variable differ between the two groups. For instance, only three HRM strategy variables are not common to the twelve variables of both the groups. Training & Retraining and Performance Strategies both the firms are not significant. These are the variables that accommodation forms ranked significantly higher than their travel trade counters parts. Therefore, it seems likely that travel trade firms require somewhat differing HRM strategies for managing aging workforce than those required of accommodation firms.
Thus, it is clear that aging workforce represents a particular challenge for Human Resource management, as this expertise has generally not been a consistent area of focus for training and development of aging professionals. This may also be the reason why it is cited as the foremost issue as HR continues to attempt to help businesses move forward. An intensified focus on training and development may be needed to develop added competencies among aging workforce to deal with change management.
Table 4.
Significant differences between travel trade firms and accommodation firms on HRM strategies employed for managing aging workforce
| Variables | Travel trade firms (TA\TO\ l O \TO ) | Accommodation firms (hotels, resorts, motels and restaurants) | Sig.of t | ||
|---|---|---|---|---|---|
| Mean | SD | Mean | SD | ||
| • Workforce planning Strategies | 6.03 | 0.99 | 6.07 | 1.03 | .000* |
| • Recruitment & selection strategies | 5.53 | 1.53 | 6.11 | 1.12 | .000* |
| • Work-life balance & flexible work practices | 5.23 | 1.07 | 6.04 | 1.37 | .000* |
| • Career planning & development strategies | 5.70 | 0.92 | 6.11 | 0.89 | .080 |
| • Retirement & pensions strategies | 5.77 | 0.86 | 5.93 | 1.32 | .000* |
| • Knowledge management strategies | 5.20 | 1.30 | 5.74 | 0.94 | .000* |
| • Training & retraining strategies | 5.03 | 1.47 | 5.89 | 1.05 | .092 |
| • Performance management strategies | 5.07 | 1.31 | 5.96 | 1.12 | .078 |
| • Maintaining & retention strategies | 5.26 | 0.58 | 5.78 | 1.08 | .000* |
| • Pay package ( compensation) | 5.47 | 0.47 | 5.74 | 0.98 | .000* |
| • Health and safety strategies | 5.38 | 1.09 | 5.41 | 1.23 | .000* |
| • Work environment strategies/Evolution of social behaviour | 5.23 | 1.40 | 5.28 | 1.35 | .000* |
*Significant at the .01 level.
IMPLICATIONS AND CONCLUSIONS
This study identified HRM strategies involved in the managing aging workforce in Indian hospitality industry and assessed their perceived importance to the organisations. Interoccupational differences in reported factor scores among accommodation firms and those from travel trade were also investigated. Several important implications regarding the HRM strategies hospitality firms perceive as significant emerged from this research. Firstly, consistent with prior researches, this study showed that hospitality firms view a number of HRM strategies necessary for managing aging workforce. However, the results of prior studies generally indicated that traditional indices of HRM are more significant in the recruitment & selection of employees. Secondly, in this study, however, both qualitative and quantitative HRM strategies such as workforce planning, retraining, knowledge management, performance strategies measures as most important for hospitality firms. Finally, in accommodation firms several of the highest rated strategies are identifies as Career planning & Development Strategies Recruitment & Selection Strategies, Workforce planning Strategies, Worklife balance & flexible work practices, Performance management Strategies, Retirement & pensions Strategies and so forth.
The cross-sectional nature of this study precludes us from making any definitive conclusions regarding shifts in hospitality firm's management attitudes over the past few years. However, the increased importance that management attached to HRM strategies for managing aging workforce may be an attitudinal change in response to problems of aging workforce of increasing significance to the hospitality firms (travel trade and accommodation). In the recent years, there has been a surge in employees' skill, knowledge and abilities resulting higher absenteeism, turnover, skill shortage and so forth. These trends inevitably call into question the management of aging workforce in the hospitality industry.
As stated at the outset, HRM strategies for management of the aging workforce are of significance to Indian hospitality industry. Thus, this study emphasises the importance of HRM strategies and is of added value to the research of 'managing aging workforce'. An ageing workforce creates interesting changes, both in attitudes and behaviours. Motivation is a core issue in keeping people active and employable. Results highlight the fact that HRM strategies have an effect on the motivation of aging employees and that this effect differs between age groups. In an organisation with an ageing workforce more attention needs to be paid to the different workforce and their specific needs. HRM strategies must move beyond their managerial or supervisor role and establish motivational environments that inspire followers to achieve levels of performance that meet the worker's expectations and perhaps exceed their initial beliefs in their own capabilities. Hospitality organisations must adapt HR practices and strategies to respond to these changes. An age related HRM strategy shapes the context in which management is able to better balance the employees and work goals of the organisation.