Understanding the Workforce Ageing Problem in Global Talent Hubs

An essential element of a robust workforce planning strategy is concrete actions around ageing labor pools across the global talent hubs.  The pandemic has created some gaps in thinking about the ageing impacts of labor.  One critical study came out in 2021 that caught our attention.  This study conducted a crucial experiment and extracted fascinating results

Börsch-Supan, Axel & Hunkler, Christian & Weiss, Matthias. (2021).  Big Data at Work: Age and Labor Productivity in the Service Sector.  The Journal of the Economics of Ageing. 19. 100319. 10.1016/j.jeoa.2021.100319.

The authors proved that productivity does not decline with age, and it improves with experience in professional jobs.  It declines in certain routine task professions not much connected to the knowledge economy.

The world is in a complex scenario where we need the ageing talent to perform at optimal levels.  Peter Drucker summarizes this nicely.  “When work for most people meant manual labor, there was no need to worry about the second half of your life.  You simply kept on doing what you had always done and spent the rest of your life doing nothing.  Today, however, most of the work is knowledge work, and knowledge workers are not finished after 40 years of work; they are merely bored.”

We are not stating that we should have a labor strategy that considers the ageing population an integral element because it is good to do.  The reality is we need this talent fully thriving in enterprises.  Across all global talent locations, the ageing population is a concern.  The following plot shows how the ageing population is expected to trend (population > 60 as a percentage of population)