The Maturing Workforce

Maturing Workforce A View from the UK

I recently attended a dinner sponsored by the IBM Human Capital Management practice in the UK. In coversations with twelve Chief Human Resources Officers who were discussing the topic of the Maturing Workforce, a number of important themes became clear: Choice is an important component for employees as they approach retirement age. Some will choose to work, others will choose to do different kinds of work, while others will opt to exit the workforce. Where organizations need to focus is providing employees options, that, at the same time, are cost effective and relevant for the organizations themselves. Training was a subject raised by several individuals. Organizations have to get past a mindset that firms are less likely to obtain a return on investment on older workers, either because older workers don't want to learn or that their learnings can not be applied over a long enough time horizon. For firms to retain productive workers, training can help improve skills levels and make workers feel that the firm still finds their capabilities valuable - an important retention tool. This point was strongly emphasized by Dr. Sarah Harper, the Director of the Oxford Institute of Aging at the Universtiy of Oxford (http://www.ageing.ox.ac.uk) Many firms still do not have the analytic capabilties to determine which key positions they are most risk for losing, and the associated risks attached to losing individuals within those positions.

-- Eric Lesser, Associate Partner, IBM Institute for Business Value 

The Workforce is Maturing - Time to Prepare

Eric Lesser, Institute for Business Value, Human Capital Management Leader, IBM Business Consulting Services

 

There are lots of things we don't know about the future. We do, however, have the luxury of knowing for sure that one big change is coming. The workforces in developed countries are aging.

 

What should we do with this precious foreknowledge?

 

Prepare.

 

The maturing workforce is likely to become the single biggest social issue of this new century. Governments, employers and workers will all struggle to adapt to a social change which, over time, will prove to be as big and as important as the entrance of women to the workforce in the twentieth century.

 

Good preparation starts with a lively discussion of the issues. As Jim stated quite well, with this blog, we want to make a start. There’s a lot to discuss. The maturing workforce is going to impact public finances, change employment patterns, alter worker expectations and put pressure on governments to rewrite tax, pension and employment rules.

 

Let's start the discussion on the impact of this massive social change on the workforce of the public sector, which faces especially challenging demographics.   For those ready to dig deeper on the issue, you can read a paper on the subject on how governments can seek future prosperity.

 

What we want to help create is a forum for contributing experts who are approaching these issues from different perspectives.  I too extend an invitation: We want to build out this group blog to include insights from people concerned about the looming perils in the public sector and to tee up issues for debate and discussion.  If you want to contribute, you can do so by engaging in the debate using the comment feature, or if you’d like to become a regular contributor, e-mail us here.

 

Together, we can move this from discussion and debate, to real action on the issues.

 

Uncle Sam Meets Chicken Little?

Jim Cortada, Insititue for Business Value, IBM Business Consulting Services

 

Look out ahead! There's a speed bump on the road to prosperity... While governments around the world are implementing numerous initiatives to make their economies competitive in a global market, there are some flashing yellow lights: 

 

ð        Increasing social commitments.  In the developed world, falling birthrates are coupling with aging populations to rapidly shrink the workforce.  As the ratio of retirees to working citizens rises, governments will be harder pressed to support their retirees.  By 2010, the OECD predicts for its member nations, the cost of social commitments will exceed the revenue for them.

ð        Inability to raise sufficient revenue.  According to the European Policy Center, the cost of caring for retirees in Member States will grow 3-7% per year in the coming decades – while GDP growth in these states has averaged 2% per year.  Growth rates, then, would have to triple or quadruple to meet this burden.

ð        Variable, competing funding priorities.  Even with superb planning, it is difficult to foresee all possible contingencies and their costs.  Before 9/11, who in the U.S. would have envisioned the need for homeland security as it exists now – with its $550-600 billion annual cost?  These unplanned expenses can crowd out investment in infrastructure and R&D needed to ignite economic growth.

ð        Rising globalization.  With international competition for jobs, capital, services, and goods, governments are less able to act independently or monopolistically within their borders.  They’re obliged to take steps – often expensive ones – to increase their attractiveness.

 

So why a blog on these issues?

 

If governments fail to respond appropriately and with due speed to these real and inescapable threats, they risk fiscal instability, the loss of national competitiveness, and, ultimately, a drastic decline in living standards.  Nations accustomed to prosperity and built upon it could find themselves facing social unrest.

 

But we're not here to focus on doom and gloom, our aim is to generate some awareness and discussion around these issues.  This blog isn't meant to be a discourse on how the current demographic dynamics are warping the workforce in the public sector, but rather a forum for contributing experts who are approaching these issues from different perspectives.  We hope to build out this group blog to include insights from people concerned about the looming perils in the public sector and to tee up issues for debate and discussion on what is possible.  We'll also branch out on occasion to discuss how the maturing workforce is impacting other industries and countries.

 

And of course, we'll include the latest news and trends we see out in the world and give our take on what is real, what is hype and what we should be thinking about as we move forward. It is our firm belief that the if the sky really is falling, there's no time like NOW to hoist it back up on the pillars of innovative and creative thinking.

 

Please join us -- we are happy to host guest bloggers on our site to tee up issues for discussion, and if you'd like to be a regular blogger on this site, we welcome that too. As new members join they will post a bit about their background and dive right into the discussion. If you'd like to participate, just start commenting. If you'd like to become a regular or guest, drop us a line here.