The untapped market ‘hiding in plain sight’

A certain group of workers may be the key to unparalleled levels of financial and productivity boosts.

As reported earlier this year, older coworkers are often judged by their age above all else and are accordingly given less responsibility, compounding an unjust cycle of underestimation.

However, a mindset shift may be on the horizon, with new OECD research showing the significant business impact of retaining older workers.

According to KPMG Urban economist Terry Rawnsley, “we have a large pool of experienced, work-ready people, yet businesses are still struggling to fill roles”.

Australia currently sits 24th in the global ranking of workforce participation of 55- to 64-year-olds, at a rate of 69 per cent. However, new modelling estimated that an increase to just 77 per cent – still sitting far behind New Zealand (80 per cent), Japan (82 per cent), and Sweden (84 per cent) – would see a workforce 240,000 workers stronger, translating into a GDP $29 billion stronger.

In this way, “maintaining older talent is a multibillion-dollar opportunity sitting in plain sight if we can get the settings right”.

Between 2005 and 2015, Australia’s labour force participation saw a strong boost in the 55–64 age group, which can partly be attributed to the move towards less physically demanding roles and greater part-time and flexible work opportunities.

However, according to Rawnsley, this momentum has stalled, and what needs to be addressed now is the different needs of workers.

In the same vein, “Australia’s combination of the age pension, superannuation, and private savings can encourage some people over 60, who might otherwise remain employed, to exit employment earlier”.

And this is something that should be addressed sooner rather than later, considering the strain workforce shortages are putting on economic growth.

Older workers also face a more challenging process of re-employment, with Jobs and Skills Australia analysis of Australian Bureau of Statistics data revealing that workers in the 55–64 age bracket can take more than twice as long to find a new position, fuelling the disincentive.

In this way, the attraction or retention of this pool of workers can be better ensured through “flexible work, targeted training, and better job matching”, Rawnsley explained.

“There are also over 200,000 people aged 55–64 who are on JobSeeker and around 250,000 receiving the Disability Support Pension. This reflects a significant group of people who may be eager to contribute but are not finding the right support to help them join the workforce,” he said.

“This is not just about workers, it’s about how employers think about jobs and keeping older talent.”

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