Porsche Werk Leipzig Photo: Martin Klindtworth - www.zentralfotograf.de
© Martin Klindtworth for the FT

Two Porsche workers sit in swivel chairs on wheels, rolling around the factory floor in Leipzig as they inspect the underbody of a sleek black Panamera executive car hovering just above their heads. Using tools built in to their arm rests, they apply final touches to a car that will soon roll off the production line and sell for more than €90,000.

Their task, seemingly mundane, goes to the heart of one of Germany’s biggest challenges in the coming decades: defusing the “demographic time bomb” that threatens to knock Europe’s economic powerhouse off its perch. In their ergonomically designed swivel chairs, these workers are playing a small part in a wider, far-reaching drama as Germany plc tries to prove to worried politicians and shareholders alike that the country’s economy will not be at risk when millions of baby boomers retire in the coming decade.

Nearby is a turquoise Macan, a two-tonne sport utility vehicle suspended from an overhead conveyor. It is lowered down to the assembly line, then rotated 90 degrees on to its side so workers in their grey overalls can tighten bolts in the chassis without the need to look up. Down the line, colleagues who must lift their arms repeatedly are aided by €5,000 exoskeletons — lightweight, metallic structures worn like backpacks that attach to the arms and provide support for repetitive tasks known to cause injuries.

Porsche has mapped out the entire Leipzig factory with a traffic-light system indicating ergonomic comfort, so managers can schedule shifts in such a way that the same body parts are not overburdened. Workers here typically operate in hour-long shifts, rotating from station to station throughout the day.

“Green is good, yellow is the normal strain you might experience at home, red means we need to do something,” says Anne Heinrich, an ergonomics specialist at Porsche who helps to minimise discomfort in production. “The aim of ergonomics is not to react but to be preventive.”

Andreas Haffner, Porsche’s head of human resources, says the output from such investments is clear. “We are quite convinced this will bring an advantage to the employees and, of course, to us as an employer, because the employees don’t get sick or ill and stay at home for a while or go to the doctor,” he says.

Porsche is reacting to a series of projections that look alarming. Before 1.5m migrants entered the country and changed the equation a bit, 2019 was expected to be the first year on record in which German workers aged over 60 would outnumber those younger than 30, according to the Federal Statistical Office. The average age of Germany’s population is already 46 years, a dramatic rise from just 40 in 2000 and 34 in 1970, according to Statista, the business intelligence portal. A recent study by the Bertelsmann Foundation calculated that in 2020, three workers will support every person aged over 65, but by 2035 the ratio will be one-to-one.

If Germany ever loses its triple-A credit rating, the likely reason will be “the impact of demographic change on the German economy and social security systems”, rating agency Moody’s has warned. The shrinking labour force is already making it difficult for some companies to find the right talent. By 2030 Germany is expected to face a skilled worker shortage of 3m people, according to the research institute Prognos.

The challenge for Germany plc is to take the risk of an ageing society and transform it into an opportunity to reap what consultancy Deloitte calls “the longevity dividend” — being able to benefit from the productivity of older employees.

“If Germany can’t deal successfully with an ageing workforce, then its productivity and innovation are at stake,” says Hannes Zacher, professor of work and organisational psychology at the University of Leipzig. “We need older workers to work successfully, to grow the economy, and to keep innovating.”

Bilfinger, where older workers can explain technical processes through educational videos

Zacher says a few pioneering companies are setting an example, but too many do not understand the value of redesigning factory floors or introducing flexible working hours to accommodate an older workforce so they can thrive for longer. “The ageing workforce is not just a problem, it’s a challenge and even an opportunity for companies,” he says. “Older workers can learn new knowledge and skills, they can develop in new directions and they can take on new roles.”

Investing in ergonomics is not just about diminishing the effects of a silver-haired workforce but capitalising on them. Older workers tend to be a company’s most experienced and innovative workers. According to one US study with nearly two decades of data, workers aged over 55 are more entrepreneurial than millennials. The problem, Zacher says, is that companies fail to adapt to their specific needs, often resulting in demotivation that leads to early retirement.

What gives optimists hope is that “doomsday” scenarios for the German economy are typically based on the fact that German manufacturing workers retire, on average, at 62. But that age is downright sprightly in light of health and life expectancy advances over the past century. A German aged 65 today is expected to live about another 20 years, according to OECD data. Those currently in their 20s are likely to be working into their late 70s and even into their 80s, say Lynda Gratton and Andrew Scott, authors of The 100-Year Life.

Porsche Werk Leipzig
Photo: Martin Klindtworth - www.zentralfotograf.de

To fight boredom and ergonomic problems, the most efficient companies train their workers to be competent at multiple stations, says Ron Harbour, a partner at consultancy Oliver Wyman, and co-author of the Harbour Report, which has been evaluating manufacturing productivity since the 1980s.

“The differentiator between the best plants and the rest are the people, because anyone can buy the technology,” he says. “It’s about how you use people. The best plants are organised into small productive teams — five to seven people at the most — and within that team you generally rotate every couple of hours.”

Harbour tracks absenteeism across factories around the world, including scheduled holidays and unexplained no-shows. He is not able to share the particular data, but says “the range would blow you away”, with absenteeism reaching as high as 25 per cent in the least efficient factories. “Can you imagine being a supervisor and one out of every four people on your staff doesn’t show up?”

Ergonomically designed workplaces, he says, are a relatively inexpensive way to keep workers engaged. “When you look at what a company pays for worker compensation, particularly back injuries and chronic injuries, it’s a no-brainer,” he says.

Keeping employees happy and healthy also means being creative to promote better habits. The pharmaceutical company Merck, for instance, has partnered with a “man-in-a-van” start-up that brings gym equipment and a personal trainer directly to employees. Instead of the typical coffee break, workers are incentivised to schedule 12-minute workout sessions multiple times over the course of three months.

In Dingolfing, Bavaria, at carmaker BMW’s largest factory in Europe, operators who used to lift and install heavy objects for the front-axle transmissions now work alongside table-top robots made by Kuka. The German robotics leader is known for its giant, steel-bending robots that work securely in cages, but its table-top, collaborative robots — known as “cobots” — are among its fastest-growing products to aid workers who have monotonous and physically demanding tasks.

Without such investments, German and European companies risk losing their competitive advantage, experience and skills, because 50 per cent of blue-collar workers across the continent are expected to begin retiring in the next five years, says Franz Braun, chief digital officer at Bilfinger, a German engineering group.

Among other approaches, Bilfinger has created an internal service called Industrial Tube. It allows older workers with experience in niche areas to create educational videos, following easy-to-use templates, so their wisdom is not lost when they retire. “We would like to capture the knowledge from our blue-collars,” Braun says. “This is a new way to transmit knowledge.” The software behind the service uses artificial intelligence so that “when words are spoken, subtitles are created”, Braun adds.

Porsche Werk Leipzig
Photo: Martin Klindtworth - www.zentralfotograf.de

Some companies are even finding new ways to retrieve lost expertise by incentivising workers to come back and perform consulting work. Daimler, the parent of carmaker Mercedes-Benz, cleverly calls them the “Space Cowboys” — after the 2000 Clint Eastwood film in which a group of retired astronauts are called back to rescue a satellite.

Technology group Bosch founded a similar programme with 30 senior experts in 1999. It now has 1,700 retirees working again as consultants, usually for two days a week.

“When we have a short-term problem, these people can immediately help and be productive. They know the language. There’s a big benefit to keeping them,” says Robby Drave, co-leader of the initiative, called Bosch Management Support.

Drave understands the needs of his staff well. He joined Bosch in 1979, then retired in 2017 after working his way up to being a board member at both its car multimedia division and its thermotechnology unit. His four-decade career spanned six divisions and three countries. Today he uses his expertise two days a week to match senior talent with the right projects. On the other five days, “I ride my Harley-Davidson, I do watersports, I sail, I ride my motorboat,” he says. “I spend more time with my wife and family. We take short trips within Germany.”

Carolin Eitner, a senior executive in strategy and demography management at ThyssenKrupp’s European steel division, says promoting “age diversity” on the factory floor is not just good for the older employees but also helps to build loyalty and employee retention throughout the workforce. “We have a very low rate of people [leaving],” she says. “Workers want to grow old with us, because they know we have the social responsibility to bring them healthily into retirement.”

Porsche has been luckier than most manufacturers. The sports car maker has nearly doubled its workforce the past six years, causing the average age of its employees to drop from 44 to 39, among the youngest in the automotive industry.

“More than 50 per cent of our workforce are millennials born after 1980,” says Haffner. “Of course, we won’t be able to double our workforce over the next five years. Therefore, we have to look at the long run.”

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