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The Challenges and Opportunities of Australia’s Ageing Workforce
For the first time, Australia is experiencing the effects of an ageing workforce. In fact, the Australian Human Rights Commission estimates that by 2050, a quarter of Australians will be aged 65 years or older.
With the average retirement age being pushed back later and later, more older Australians are participating in the workforce than ever before. With this ageing workforce comes new challenges as well as some exciting opportunities.
What is contributing to Australia’s ageing workforce?
The labour force participation rate of older Australians has
jumped from 47% in early 2000 to
Some of the reasons for this include:
- Improved health and longer life span
- More jobs in the highly accessible service sector
- Favourable tax treatment of superannuation contributions
- Greater flexible working options
- The impact of the global financial crisis on retirement savings, which has forced some baby boomers to work longer than they had planned
Opportunities for an ageing workforce
Mature-aged workers present enormous potential to the Australian workforce and economy, with some of the opportunities including:
Improved company and economic productivity
According to a Deloitte Access Economics report, a 5% increase in workforce participation from Australians aged 55 years or older could add $48 billion annually into the economy.
Greater experience and expertise
As older Australians have been in the workforce longer, they will typically have greater expertise and experience under their belts. This can help to fill skill gaps and train younger workers.
Loyalty and work ethic
Older workers are five times less likely to change jobs than workers between 20-24, cutting down on recruitment and training costs as well as providing long-term benefits to the company.
The benefit to mature-age workers
By participating in the labour market for longer, older Australians can enjoy increased incomes and savings to ensure their comfort in retirement. Staying in the workforce for longer also helps to improve health outcomes while reducing the strain on the health and welfare systems.
Challenges of an ageing workforce
As this is an unprecedented situation, considerable challenges are also sure to pop up.
Some of these include:
Age discrimination is a barrier that many older Australians face, with negative attitudes towards older workers including the perception that they will produce lesser quality work, be unable to learn new things, and be resistant to change. In fact, a third of older Australians report facing age discrimination while employed or searching for employment.
Rapid technological changes
It may be difficult for some mature-aged workers to adjust to the ever-evolving nature of technology, especially if they are re-entering the workforce after a long time.
While 75.5% of Australians aged 55-64 report their health as “good”, “very good” or “excellent”, there are still some ways in which workplaces may still need to accommodate to the needs of older employees.
Solutions to create an inclusive, robust workforce
There are a number of ways companies, training institutions and younger workers can help to create an environment which is inclusive of older workers. These include:
- Re-skilling older workers on areas relating to social media and technology, or allowing for job shadowing opportunities or providing temporary assignments to build new skills.
- Placing a greater emphasis on online training programs, which allow mature-aged workers to study from the comfort of their own homes and at a pace that suits them.
- Allowing for remote or flexible work, especially for older workers with health concerns.
- Providing ergonomic furniture and equipment to relieve day-to-day strain.
- Conducting training to raise awareness about age discrimination.
- Creating new roles and career pathways that allow for the best use of older workers’ experience and keep them engaged.
- Rethinking incentives, such as swapping out early retirement benefits for a modern retirement model that considers salary, rewards, medical benefits and pensions.
The increased participation of older Australians in the workforce offers great benefits to the workers themselves, companies and the economy as a whole.
By addressing the above challenges, we can create a more highly skilled and inclusive workforce with national benefit.
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