There’s been continued discussion about Britain’s ageing workforce and demographic time-bomb. What everyone does agree on is that the UK is dangerously reliant on older workers.
As they retire and exit the workforce they’re taking with them skills and experience vital to the effectiveness of the UK labour market and competitiveness of the broader economy. Yes this situation is the result of a huge demographic shift where we, as a society, are getting older. But it’s also more complex than this.
Hay Group analysed data from more than five million employees across the world, looking at the traits of different age demographics within today’s workplace. We found that older workers are attractive for the majority of employers: they tend to be hard-working, loyal, and receptive to a top-down management approach. By contrast, younger generations bring elevated expectations and high levels of independence. Many large or more traditional businesses are still struggling to offer what these younger employees truly value.
And there are further divides between young employees and the businesses they join. Half (51%) of 150 UK graduates we recently surveyed felt people skills got in the way of them getting the job done. Contrast this with those in charge of graduate recruitment and development – the majority (93%) of which believe that strong people skills are vital to driving commercial impact and key to the leadership potential of workers.
Divisions such as this raise probing questions: is the education system preparing young people well enough for the world of work? Are employers investing enough in developing key skills in younger employees?
Unfortunately comparing statistics on the number of older people being retained versus the figures for youth unemployment gives a depressing answer to these questions, and provides a sense of the scale of the problem. Recent figures from the Office for National Statistics, for example, placed youth unemployment at three times higher than the national average.
Where is this hurting the economy most? Businesses relying heavily on engineering, project management, and other STEM-related skillsets, have the poorest correlation between their objectives and the skills they currently have. Sixty per cent of engineering leaders describe attracting and retaining mission-critical engineering capabilities as a key challenge over the next five years.
However, the need to plug and fill skills gaps applies to all industries. So what can organisations do about it? My advice is to target reform on three specific areas:
1. Talent recruitment schemes – establishing more apprenticeships and graduate programmes, with greater alignment between businesses and educational institutions, to better attract and match young talent with the right roles.
2. Actively support younger generations. This is not a tick-box exercise in ensuring workers have the required technical skills, but greater support for the ongoing development of key social and emotional skills needed to succeed in the workplace.
3. Change your business so that it provides the right environment to inspire today’s multigenerational workforce. This is about educating and improving your leaders in what is required from them but it’s also about your culture and reward schemes. How can your approach to engaging employees be updated to create a stronger match between the way people want to work and the kind of contribution the business wants them to make?
Matt Crosby is head of expertise, UK and Ireland at Hay Group