In Australia, declining birth rates and increasing life expectancies render an aging workforce an inevitability. Research suggests, however, that many organisations are ill-prepared for this impending disruption. Executive leaders should be mining for opportunities embedded in this change and adapting their workplaces accordingly.
Visions of Australia’s organisational future tend to follow a similar trend. We imagine robots, automation, digitalisation and progress. Our predictions are pervaded by innovation and new ideas.
From this image, there is one glaring omission.
While the vast majority of imagined changes involve the implementation of something new, the composition of our human workforce will be exactly the opposite.
Australia’s workforce, inevitably and undoubtedly, is aging.
This is part of a global trend in the developed world. As life expectancy has increased, birth rates have dropped off. This means that a greater proportion of the global population – and by extension the workforce – is made up of older people. According to United Nations estimates, one third of people living in the developed world will be at least 60 by 2030. The same applies for Australia; nearly one quarter of workers are over 55. In essence, employers will be faced with a labour market dominated by older candidates.
Despite this disruption, necessary adaptations have not been forthcoming. According to Deloitte’s 2018 Global Human Capital Trends Survey, only 29% of respondents rated this issue as important. Similarly, only 18% said that older workers were an asset to their team.
Clearly, executives are faced with an impending disruption to their workplace. However, many not only ignore this but choose to diminish its importance.
The impacts of this blindness are huge. Japan has been facing this reality for years. Many organisations did not prepare for the fact that older employees were going to require different conditions and styles of work to the traditional employee aged 25 to 50. As such, there was a labour shortage of around 1 million people in 2015 and 2016, which was estimated to cost the country $90 billion.
This emphasises the absolute vitality of executive leaders taking active steps to make sure they are capable of responding to this disruption once it takes effect.
Rather than small-scale strategies, proper adaptation will require systemic change within organisations.
The central issue undergirding the current reluctance to embrace older employees stems from bias. According to Graham and Healy from the University of Melbourne, workers in their mid-50s and above are characterised as less motivated, harder to train and less adaptable. Executives seem to think that older workers offer nothing to their organisations. This trickles down to other workers so that the entire organisation is hesitant to accept people who are older.
Executives in positions of leadership must alter this culture of alienation so that Australian organisations are able to embrace an older workforce once this becomes a necessity. For example, the qualities that come with age – such as expertise and wisdom – need to be privileged and respected. Certain roles can be reoriented so that this can occur. Moreover, older workers should be encouraged to retrain or reskill so that they can still play a part in their organisation; gone are the days where age 60 is a use-by date after which one becomes immediately redundant.
Age catches up with all of us. It isn’t something that we can shy away from. One day, when we stare into the mirror, the face that stares back won’t be the one we have always recognised. It will be older.
Executive leaders face a similar proposition. When they look at their workforces in a decade, they will not be the same. They will be older.
Rather than denying reality, complete leaders will not only prepare for this change but embrace it. They will search for the opportunities posed by an older workforce and adapt accordingly. This adaptation starts with wholesale organisational change.
You cannot afford to be left behind.
The Complete Leader Program uses a range of analytic devices to help foster cognitive and emotional flexibility in participants. If you are interested in developing this adaptive capacity, please contact Melinda Fell.