Workforce development strategies and older workers in Australia

Abstract

We know that Australia's workforce is going to look very different in 10 or 20 years time. During the entire decade 2020 to 2030, only 125 000 new entrants will join the workforce, compared with a current rate of 170 000 new entrants annually. Over the next decade, one third of the current workforce will approach retirement, with the potential loss to the nation of a significant pool of knowledge and experience. At the same time, low fertility rates are reducing the supply of younger workers joining the workforce. Like many other western countries, Australia faces the challenge of effectively responding to demographic change and the ageing of the workforce. The preparation of workforce development strategies is being pursued by an increasing number of governments around the world. This is particularly the case in the European, British and North American contexts, where a significant body of workforce development and planning research has been undertaken, and strategies to retain older workers have been developed. By comparison, such studies are sporadic in Australia, despite the identification of pressing workforce challenges facing the nation. Failure to address these challenges now will result in a poorly performing workforce in the future, with a shrinking pool of available workers, systemic skill shortages, poaching and wage spiralling as employers compete for workers, and potential conflict in the workplace. As a result, productivity and economic growth will be severely constrained and social tensions will emerge. This paper will examine the implications of demographic change and ageing for workforce development and planning in Australia, and discuss progress to date in South Australia in developing a conceptual framework and model to inform workforce development and planning in both the public and private sectors.