As labour supply continues to be dwarfed by demand, HR practitionersmust gain a deeper insight into the demographics of their workforce, a human capital expert has warned.
According to Professor Louise Rolland, principal, people advisory team at Ernst & Young, the segmentation of today’s workforce into categories like baby boomers or generation X or Y, while simple, does not support effective people strategies. Employers, Professor Rolland said, must shape their people strategies around other factors that influence employee behaviour, most notably their stage in life.
“The life course concept understands that people continue to develop and adapt across their lifetime, so for employers this means that unlike the generational view which promotes static characteristics and behaviour, employers need to renew their view of the needs and wants of their people at various life stages,” Professor Rolland told Human Resources. “Employers also need to internalise the changes to the timing of life stages such as later entry to full-time work due to the extension of the education and training stage of life, and later family formation.”
She added that shifting people management thinking from the generational to the ‘life stage’, HR can have a direct impact on addressing labour shortages and helping attract a wider talent pool. “Better understanding of life stage within the life course will support improved people outcomes in relation to women’s participation across industries and occupations as well as the extension of working life beyond normal early retirement, both of which will provide a significant boost to the supply of labour in an impending era of labour squeeze. In addition, it will break the nexus between youth and recruitment profiles of most businesses. Understanding that people transit roles across sectors throughout their working life will position progressive businesses to attract from a broader candidate pool and to capture opportunities for re-recruitment, which is an increasing imperative in a competitive labour environment.”
The call for new thinking on demographics comes at the tail end of an over-supply of younger people in the labour market, a trend that has exacerbated organisations’ focus on hiring younger workers. “We have come out of an era of extended oversupply of young people in the labour market,” said Rolland. “This youthful profile has dominated the labour landscape since the early 1960s and it is only over recent years that this has changed dramatically.”
She added that the traditional work progression is also a thing of the past. “Traditional work stage pathway was a single loop where we joined an employer as a young person and worked our way to our level of competence or opportunity; men retired from their lifetime employer and the minority of women who participated in the labour market usually withdrew with the birth of their first child. Business is yet to adapt to the changed environment in relation to both the demographic shift in the age structure of the workforce and the broader social shift in the patterns of employment participation and mobility.”
HR practitioners, Rolland said, should begin investigating the demography of their workforce and ensure the results are integrated into workforce and people planning activities. “The should also actively develop and promote strategies that will counteract behaviours shaped by a past era such as reduced participation in learning and development with age, poor distribution of women across industries and roles, and overrepresentation of younger people in the recruitment profile,” she said. “They need to pay more attention to re-recruitment and integrated approaches to managing health and well-being risks with age.”