How Demographic Shifts Impact Your Workforce
In a recent webinar, we discussed how to manage change associated with workforce disruptions, but we didn’t get into much detail about what these issues might be. When people talk about workforce disruptions, they’re usually referring to technology advances or evolving work structures and environments. Rarely does anyone mention demographic shifts, even though these are primary drivers of who is available to work and where. Let’s look at the big ones impacting the future of work that are sweeping the globe.
The Rise and Fall of Fertility
In many western nations, the birthrate has dropped below replacement levels, meaning that each pair of adults will have fewer than two children, causing the native-born population to decrease. While population may not decrease in industrialized countries due to immigration, the resulting workforce may have different work preferences and abilities – potentially resulting in geographic skills mismatches (i.e. organizations in a given area require skills that are not readily available in their location). At the same time, fertility rates continue to increase in countries like China and India, leading these developing nations to become the leading exporters of skilled talent working in the professional gig economy by the mid-21st century.
Boomers Exit Stage Right
The baby boomers, born roughly 1946-63, have taken longer than expected to retire from their traditional, full-time occupations. Two factors are at play here. First, many boomers lost savings in the recession and needed to work more years to support a much longer lifespan. Second, because they are healthy, many want to continue to contribute to the workforce. Rather than allowing this immense amount of institutional knowledge circle the drain, organizations would be smart to leverage boomers in part-time mentoring and consulting roles.
The Millennials Are In Charge
Globally, the enormous millennial generation (born 1980-95) became the largest in the workforce a few years ago and its professional members, which include a slight female majority, are entering leadership positions an average of 10 years earlier than prior generations. Why is this happening? I just mentioned baby boomer retirement, and the other factor is the relatively small Generation X (born 1964-79). Because there aren’t enough Gen X-ers to take over for the boomers, as of 2015, nearly half of all working millennials were leaders – defined as having at least two direct reports and decision-making authority in their organizations. The rise of the millennial leader will directly influence the trajectory of your workforce because these young managers do things a bit differently. Specifically, they embrace the transformational style, which involves seeking out new and innovative approaches from novel sources, being open-minded and appreciative of diverse perspectives and feedback, and operating collaboratively instead of hierarchically. And, if any generation is equipped to solve the problems of gender equality and female attrition in the upper ranks, it’s the millennials.
Generation Z Gets Ahead of Itself
Although the oldest members of Generation Z (born 1996-2012) just finished their university education last year, due to unprecedented, technology-facilitated access on a global scale, many teens and even kids are active participants in the workforce. They are starting their own online businesses, advising companies on marketing to their age group, and working at corporate internships before they’re out of high school. Incorporating these young employees into your workforce, however, is harder than it looks. They need a lot of supervision, so remote work doesn’t play especially well, and, as they are accustomed to finding answers online and solving problems via the most efficient method, they often have limited patience for complex processes and compliance standards.
Given these demographic shifts, leaders might want to rethink workforce management and teaming strategies. So, if you missed the change webinar, catch the replay and let us know if there’s anything else you’d like to know!
