In many globalized countries these days, including much of Europe and America, there is a problem of an aging workforce. In Germany, many of the workers in car factories are close to retirement age, and the specialized workforce to replace them is in critical shortage. There are similar challenges in the US, within the next decade workers compensation law will continue to change and adapt to these new situations.
According to data from the US Census, the US workforce is rapidly aging and many people over 55 are still working. These numbers have increased by more than 50% over the past six years. With this in mind, there is a way for employers and employees to prepare by actually changing the work environment, as well as taking precautions with more safety initiatives. This is where employers and unions have a rare situation where they can really work together for the good of both parties. Furthermore, as raw material and labor prices on the market will fluctuate, trends in workers’ compensation policy will also have to change. Group health insurance plans will increase, forcing workers compensation insurance to change as well, as the larger companies force the insurance industry to adapt as well.
Together with the problem of labor maturation, this presents a new field of pitfalls, which then cause financial problems that are significant in insurance formation. In addition to their employers, aging workers must learn new ways to use modern assistive technology. If incidents do occur, they are dealt with more successfully in workers compensation claims. While older employees are more experienced and have fewer work-related injuries, from a financial point of view they are more expensive than newly hired younger employees. This provides an incentive and opportunity for employers to find younger workers to replace them. But with the changes in broad demographic trends, the gap between the aging workforce and their replacements continues to widen. The growth in age-related health problems will also cause changes in workers’ compensation.
According to the US Bureau of Labor Statistics, in 2004 states paid out over $56 million to help workers; this amount continues to increase annually. In almost all of these cases, the injuries were physical incidents while the worker was performing his official duties at the designated workplace. Nearly half of the insurance budget set aside by the states is spent on health care bills alone, and during 2007 workers’ compensation payouts rose to nearly $70 million. The statistics also highlight that the number one issue in workers compensation claims was once again physical related injuries.
The most beneficial way to improve the system is actually to favor the older workers. But as trends indicate, the system needs a serious overhaul. For some employers, what might have been sufficient in the past will certainly not be sufficient in the future. If workers’ compensation laws favor assisted technology, costs will increase for employers. This can be reflected in the national economy as more rules are applied in the different states. Assistive technology may have higher costs for employers, but they will benefit society as a whole by reducing our public payments in terms of compensation.
