The changing profile of the UK workforce
One of the key trends Human resources teams will have to account for in the coming years is the changing demographic profile of the UK workforce. In line with many developed markets, the UK employee base will undergo some profound changes over the next 10-20 years.
Firstly, it’s getting older. Since the start of 2008, the number of people aged 50–64 in employment in the UK has risen by 842,000 – the largest increase across any age group – while the number of people aged over 65 in employment has risen by 437,000 (see here). There are a number of key implications for employee benefits. Greater demand for the continuation of life and income protection cover for employees in their 70’s. An increase in the need for services such as optical and dental check-ups, as well as health screening. And the potential need to pass on some of the additional cost of cover to older employees.
Secondly, there is a potential skills shortage when the “Baby Boomers” eventually leave employment. With younger employees needing to replace older colleagues who had more experience and expertise. There is a need to start the process of transferring skills to the younger generation now, before they are lost. Younger employees who will be leading organisations in years to come will also have different expectations of their professional life. In contrast to older employees priorities of work life balance, working fewer hours and taking opportunities to give back to society are importmant.
Thirdly, based on current forecasts, there will be a need to encourage workers to come to the UK and fill the labour supply gap. A recent estimate suggested that even with a net migration figure of 2.3 million entering the UK over the next 20 years (see here), more people will need to be found and encouraged to come to the UK to work. In turn, this puts the onus on HR teams to widen their search for employees internationally. HR teams will need to familiarise themselves with education qualifications and standards in other countries. Then account for a more multi-cultural workforce in the future.