How do you encourage a peer who hasn’t been able to land a job due to ageism?
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It's a huge issue and more prevalent than is admitted. One key thing for older workers is to ensure they are up-to-date on technology. You can take courses and get certificates from LinkedIn to prove it to employers. My company has many older workers doing very well in their roles.
It is very difficult, but it can sometimes be solved by building a long term portfolio of accomplishments, skills, experiences, insights, etc. in a blog, GitHub repo, etc. that can demonstrate how current and valuable your skills are.
A tough one and ageism is unfortunately a hard truth. As others have stated, try to translate those years of experience to wisdom and highlight that as a strength. I would suggest focusing on some key accomplishments which highlight how that experience help facilitate and navigate a challenging situation.
I have to say that this one is a hard problem to crack. I think for me I would tell this person to see how they can translate their acquired wisdom in areas and industries where such an attribute is valuable. Teaching and consulting typically provide such an avenue for such skilled talent.
By reminding them what they have to offer - they have experience, knowledge, and likely expertise across more than IT. I'd also encourage them to use their network, and consider fractional roles.