BETTER harnessing the power of an older workforce could deliver gains of up to $78 billion for the Australian economy, according to a new PwC report.
Released yesterday, the report finds that increasing Australia’s employment rates for workers aged 55+ to equal that of Sweden (74% of those aged 55-64) could increase our GDP by around 4.7%.
The results are drawn from PwC’s ‘Golden Age Index’ which has been developed to assess the extent to which older people remain active members of the labour force. It captures a broad range of indicators, including employment earnings and training, that reflect the labour market impact of workers aged over 55 in 34 OECD countries.
Overall, Australia was ranked 16th of the 34 OECD countries, falling one spot relative to the previous year. The three highest ranking countries are Iceland (1st), New Zealand (2nd) and Sweden (3rd). The Nordic region leads the way with Norway, Denmark and Finland all in the top 15.
PwC identified the following three key labour market themes that commonly feature in countries that perform strongly in the Golden Age Index:
- Encouraging later retirement e.g. through pension reform or financial incentives
- Improving employability e.g. through promotion of lifelong education
- Reducing employment barriers for older workers
PwC economics and policy partner Jeremy Thorpe said that the population of those aged 60 and above in high income countries will grow by around a third to 400 million by 2030 and, like all countries, Australia needs to consider how to best to respond to both the opportunities and the challenges.
“The Golden Age Index shows that compared to other OECD economies, older Australians are underutilised in the labour market and our policy frameworks may inhibit their ability to make important contributions to our economic, social and public life,” Thorpe said.
“There is considerable economic gain to Australia in encouraging more older Australians into the workforce. We have a rapidly ageing population and this puts pressure on the health and social care systems and also threatens the financial sustainability or some public and private pensions.
“What we’re seeing in other parts of the world is that later retirement and more flexible working policies is good for the economy, businesses and individuals.”
Future of work considerations
According to PwC global partner, people and organisation Jon Williams, there are also some important considerations for Australia from a ‘future of work’ perspective.
“As we look forward to 2030, many of the existing jobs in our economy will change due to new and emerging technologies,” Williams said.
“The first wave of this process is likely to require increased STEM (science, technology, engineering, maths) capability in our working population to build and program a new infrastructure. This will be likely driven by younger generations.
“In the second wave, however, we believe there will be a greater focus on human skills of empathy, intuition, creativity and innovation and this shift will open up opportunities to a much wider age range where work and life experience will be highly valued.
“We will also see a shift to a less traditional employment models where people work for multiple organisations or in less rigid structures than established ‘9 to 5’ arrangements meaning more flexible opportunities for older Australians.”
Click here to view the report.
AREEA’s national diversity initiative, the Australian Women in Resources Alliance (AWRA), has produced a ‘Guide to Flexible Work’ for employers containing information, fact sheets and templates on 13 types of flexible work arrangements. The guide can be downloaded here.
