Eight drivers of change

Eight drivers of change: Demographics

DEMOGRAPHICS DEMOGRAPHICS

As the UK population ages, it is also becoming increasingly ethnically and racially diverse. Both these demographic shifts impact the world of work.

With workplaces reflecting wider society, they are not only becoming more diverse by encompassing individuals of different age-groups, gender, and race and ethnicity, but also in terms of different education and socio-economic backgrounds, religious and political beliefs, sexual orientation and disability. Employers increasingly recognise the importance of a diverse workforce as a means of attracting the best people, unleashing individual potential and mirroring the communities in which they operate.

People are living longer, healthy lives (although increases in life expectancy have slowed and were exceptionally reversed during the pandemic, at least in the UK). With declining fertility rates, not enough children are being born to compensate, while net immigration to the UK is also reducing. An ageing population means either that people should retire later or it necessitates a fundamental rethink of how both retirement and the medical and caring needs of the elderly are funded. (The UK government recently announced a new Health and Social Care Levy to begin to help meet these costs.) Will people look to their employers to fund their retirement in place of the state? Might employees need to respond to increased life expectancy by postponing retirement? At a national level, should countries with an ageing population seek to encourage a higher birth-rate, with long-term consequences for global resources? Or should they look to greater migration, or merely adapt to an ageing and declining population?

The pandemic has seen numbers in full-time education in the UK increase – a trend which (if it continues) may contribute to pressure on recruitment for some jobs as people delay starting their careers. This will only accelerate the ageing profile of the workforce. Despite the UK having age discrimination laws for over 15 years, prejudices and stereotypes about the potential contribution of those over 70 endure and will need re-evaluating. Employers must ensure they do not ignore the potential of older workers and candidates in their search for the suitable candidates, as skills shortages become more common.

Ageing population

Fertility rates

These declined in the 1970s across the G7 to below the 2.1 children per woman needed to maintain population levels. Countries face an unaffordable ratio of working age to retired population. The UK rate is 1.7 and was 1.7 in 2003 when those entering the labour market today were born.

Life expectancy

Improved health and medical advances have seen life expectancy increase significantly over the  20th century and into the 21st. In 1920, in the UK, it was 54. In the UK and the US at least, this trend appears to have slowed (and, in the UK, temporarily reversed on account of Covid-19).

Retirement ages

After decades of decline, the 21st century has witnessed average UK retirement ages increasing though the rate of increase (amongst men at least) appears to be slowing (and came down slightly in 2021). This trend will need to increase to compensate for declining fertility rates and net migration.

Over 80s

The number of over 65s and, particularly, over 80s are projected to increase significantly in the UK over the next 15 years. Caring for older people will be a challenge which will extend to employers as their workers need increasingly to balance caring responsibilities with work.

Ethnic diversity

Workforce diversity

Looking back at the last UK census ten years ago, 86% of the working age population classified themselves as white. This percentage will have declined when this year’s census results are published.

Age and ethnic diversity

In anticipation of this year’s UK census results, we can anticipate the increase in diversity amongst the workforce from data on average ages amongst different ethnic groups from the last census.

Attitudes to racism

The British are becoming more open-minded in their attitudes to race and more concerned about racial inequalities.

Racial disadvantage

Racial disadvantage

A pent-up global frustration came to the surface with the #BlackLivesMatter movement and many employers were quick to express solidarity. Within the workplace, ethnicity pay gap reporting could be a significant tool in  addressing racial disadvantage.

Generations

Baby boomers

Baby boomers

(dob 1946 - 1964). Committed; self-sufficient; competitive (Dr Alexis Abramson) . The employer response should be: provide with specific goals and deadlines; put in mentor roles; offer coaching-style feedback (Purdue University).

Generation X

Generation X

(dob 1965 – 1980)). Resourceful; logical; good problem-solvers (Dr Alexis Abramson). The employer response should be: give immediate feedback; provide flexible work and work/life balance; extend opportunities for personal development (Purdue University).

Millennials

Millennials

(dob 1981 – 2000). Self-sufficient; confident; curious; question authority (Dr Alexis Abramson). The employer response should be: get to know them personally; manage by results; flexibility on their schedule and assignments; provide immediate feedback (Purdue University).

Generation Z

Generation Z

(dob 2001 - 2020 ). Ambitious; digital natives; confident (Dr Alexis Abramson) . The employer response should be: offer opportunities to work on several projects at same time; provide work/life balance; allow to be self-directed and independent (Purdue University). 

Sex/Gender

Female labour participation

Across the G7, the proportion of women to men in the workforce has increased over the last 30 years (though this increase has slowed). There is no reason to doubt that this trend will continue, though the rate of increase does seem to be very gradual once the ratio approaches 8.5:10.

Glass ceiling

Increased attention is being paid to eradicating the barriers to women achieving senior management roles. Data for the G7 shows the significant strides which have been made over the last ten years particularly in Europe.

Gender pay gap

Although there is much more to do, there has been progress since the Ford workers fought for equal pay in the 60s. The declining gender pay gap highlights diminishing disadvantage faced by working women as well as the power of reporting obligations to effect change.

#metoo

#metoo

This movement has seen greatly increased attention paid to eradicating sexual harassment at work and a new-found zero tolerance to harassment at work. High profile cases, reputational damage, changing values and more women in senior roles have all contributed.

DEMOGRAPHICS - INTERCONNECTING DRIVERS

Technology

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Technology

Role of the State

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Role of the State

Sustainability

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Sustainability

Migration

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Migration

Globalisation

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Globalisation

Covid-19

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Covid-19

Demographics

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Demographics

Part 1 

DRIVERS OF CHANGE

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Part 2 

EMERGING THEMES

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Part 3 

PREDICTIONS

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