100,000 more oldies in workforce by 2012- study

By Niko Kloeten, The National Business Review

November 27, 2008 

New Zealand

Employers need to switch their focus from Generation Y to baby boomers if they are to thrive, says a study that predicts one in five workers will be over 55 by 2012.

Workplace 2012, a research project commissioned by Mercer and conducted by Econtech, forecasts massive demographic shifts in the next four years, the biggest of these being the rapid ageing of the workforce.

The number of workers aged 55 and over is forecast to increase by 100.000 by 2012, a 24% jump, rising from 18% to 21% of New Zealand’s workforce as baby boomers age.

Meanwhile, the number of workers aged 25-54 is forecast to increase by only 28,000 in that time, a comparatively small 2.5% increase.

Mercer’s New Zealand business leader Bernie O’Brien says businesses need to look through the current turmoil and think long-term with regard to recruitment and staffing.

“The recent global economic crisis, and recession in our own backyard, does not make ongoing demographic changes to New Zealand’s workforce irrelevant – it actually brings them into sharper focus.

“Employers who react to the current economic crisis with no long-term view are at risk of destroying a viable and productive workforce.”

He says a combination of low fertility rates, people staying longer in the education system and the dreaded “brain drain” means young New Zealanders aren’t entering the workforce fast enough to replace those who are retiring.

“In the next four years more and more skilled and experienced workers will retire, and employers will be left without the resources they need when the economy rebounds.”

Mr O’Brien expects the skills shortage to continue due to these changes, with competition for workers intensifying and companies offering various benefits to try and retain staff.

“The smorgasbord approach, where those in their 30s pick what they want, and those in their 50s pick what they want, and so on, may be the way to go.”

But he adds that around 90% of New Zealand employees work for small businesses, which may not be able to offer the work flexibility and benefits big companies can give their workers.

To respond to this, he says small businesses need to ensure they know exactly what makes their staff tick.

“Why assume when you can ask?”

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