By Christine Jeavans
BBC News, Finland
UPM-Kymmene's Tervasaari plant: Paper is a key industry in Finland
Finland has one of the most rapidly ageing populations in Europe, easily outstripping the UK. Until recently this was coupled with a low level of employment of older workers meaning the country was heading for a severe labour shortage.
That was until the advent of a new concept called "work ability" which has had dramatic results and seen governments from Europe to Australia wanting to know more.
The small industrial town of Valkeakoski in western Finland gives no outward indication that it is at the leading edge of a social revolution.
Nestling among forests of birch and pine 145 km (90 miles) outside Helsinki, the town is dominated by the paper industry whose water-hungry factories line its three lakes.
But inside the biggest of those mills, UPM-Kymmene's Tervasaari plant, a quiet but steady change is taking place.
Almost 40% of the workforce here is over 50 but rather than winding down for retirement, they are being encouraged to stay at work.
They are given extra training, moved to more appropriate jobs where possible and treated as the wise elders of the company.
"The main target is to keep people longer in working life and to create such health conditions that they can stay longer to get additional training and support," says Personnel Manager Turkka Heinelo.
He gives the example of a 60-year-old male worker who was doing one of the most prestigious jobs on the shop floor: operating the vast paper milling machine which runs 24 hours a day.
He started to find the job too much to handle so he was allowed to move to day shifts and stayed in the same unit as a reserve man. This way, his vast experience of how to do the job was not lost - and he retained his status and self esteem too.
Work ability concept
Workers are given special reviews at ages 53 and 59 where they are asked if they need any more training, given the opportunity to talk about problems with working life, and advised on retirement issues.
The first of several initiatives at Tervasaari began in 2000 and has already borne fruit: within three years the average retirement age at UPM has risen from 57 to 59.
The company has been held up as a model of "work ability" a complex holistic concept that the Finnish government has been promoting since 1998.
Work ability looks at the interplay between all the factors that enable a person to function well in a job.
It aims to balance the personal factors such as health, skills and motivation, with the job itself: how it is managed, what the working environment is like and what the role actually entails.
"Naturally you do decline physically but a lot of cognitive functions improve with advancing age," said Professor Juhani Ilmarinen from the Finnish Institute of Occupational Health, a key player in the work ability programme.
If employers do not understand that their workers are changing as they age and change the work accordingly, he said, then all they see is decline in productivity.
"We have been blaming the wrong source - the human beings - saying 'you are poor' although really it's the job that is poor."
Instead, the work ability programme aims to convince employers to tailor their work to individuals as they age - and also to improve those individuals' health and skills or knowledge needed for the job.
Crucially, the programme is evidence-based so companies and organisations can see how they are losing by not implementing it.
"Sickness and absence costs per person per year is something like 3,500 euros if work ability is poor," said Prof Ilmarinen. "But if the level is excellent it is only 200 euros per person, so you can easily work out how much you can gain from this promotion."
Finland launched its work ability programme in 1998 after a long trend of early retirement, funded by generous state hand-outs and intensified by the laying-off of older workers during the recession of the early 1990s.
But by the mid 1990s the government realised that it could no longer afford to pay for people to leave the workforce in their early 50s. Also a labour shortage was looming as the population was ageing much faster than the EU average.
By 2030, Finland is projected to have 26% of its population over 65 - a figure the UK is not due to reach until 2051.
The mill aims to retain workers' knowledge of how the factory operates
As well as implementing the work ability scheme, the Finnish government has reformed pensions.
Workers are now given the carrot of a 4.5% increase in their pensions for every year they stay in work after the age of 63 until they reach 68.
Finland's demographic shift is evident at UPM Tervasaari where 200 of the 830-strong workforce are due to retire in the next five years, taking with them a wealth of experience.
In addition to work ability promotion, the management has set up a parallel scheme to garner this so-called "tacit knowledge" and ensure it can be passed on to younger workers.
Those 200 workers must know "millions of pieces of information," says Turkka Heinelo. "So there must be a vast amount of tacit knowledge leaving the mill unless you do something."
The Tervasaari factory has set about recording every aspect of every job and encouraging older workers to pass on their skills to the younger ones.
Shop steward Ari Reinikainen said the ageing workers programme at the factory had been drawn up with full co-operation from the trades unions because everyone realised the importance of the issues at stake.
"We used to have the illusion in this society that we were so rich that we had money to let people to go in early retirement. But now the whole society is more realistic."
Since work ability was introduced, the employment rate of Finns aged 55-64 has jumped more than 13% compared to the EU average rise of 5.1%.
"Of course no-one can say that's only because of the programme," said Professor Ilmarinen.
"But this is the only country where you see the long term effects in the retirement age going up.
"It's still far away from the optimum but I think this trend seems to be a sustainable positive trend."