According to The Economist, the number of people of working age (15
to 64) in the EU is expected to fall by 40 million over the next 50 years. At
the same time, the number of people of pensionable age (65 or over) is set to
rise by 40 million. On top of this, fertility rates across Europe are now so
low that the continent’s overall population is likely to drop markedly over the
next 50 years.
With an almost daily drip feed of news stories of this kind making our
national media, what do these predictions actually mean for UK businesses, and
is there any action that can be taken to manage the situation?
Well, clearly, there’s little doubt that skills shortages will be a key
issue for employers in years to come. If we look at some analysis over a fairly
short period since August last year, we see that Deloitte’s Report on Jobs has
recorded an upward trend in demand for staff by UK employers. It appears that
this demand is not being met by a supply of appropriately-skilled workers. As a
result, employers are already experiencing widespread shortages of skills,
leading to upward pay pressures as businesses battle to attract the best
talent. This is also leading to a negative impact on productivity rates.
As the pool of available talent shrinks and the cost of attracting talent
rises, there is a huge incentive for businesses to invest in young people
nearing working age, and ensuring they have the opportunities to equip
themselves with skills that are in demand.
Many businesses are taking on this challenge by developing innovative ways
to reach young people and encourage them to further their education, with the
intention that they will consider careers in business in the future. In return,
young people have the opportunity to follow a career that would not ordinarily
be open to them.
Deloitte’s response to supporting entry-level employment has been to lead a
programme called skills4industry, which is an employability initiative backed
by the DfES and some of the UK’s largest companies, including HSBC, Vodafone, Boots
and Selfridges. The programme’s aim is to provide 16 to 18 year olds with the
qualifications and experience they need to secure employment, but also the
employability skills that are vital to the UK’s businesses. While the
initiative was road tested in the IT industry and has been extended to the
retail sector, it also has resonance in all sectors facing entry-level skills
shortages.
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Initiatives such as this are crucial in maintaining the supply of future
talent to businesses. The onus is on leading organisations to support the
development of younger people to ensure that, in a time when the working
population is shrinking, the level of necessary skills and talent is
maintained.
This is just one way of recruiting the managers of the future – what is clear
is that the debate about how to do this is likely to run for a long time.
