Demographics around the world are changing, and this has profound implications for the Canadian labour force, said Dr. Linda Duxbury, professor, Sprott School of Business at Carleton University and keynote speaker at the ISCEBS Symposium in Vancouver.
From a birth rate perspective, in most countries, people aren’t having enough children to replace themselves, she explained. And, since they’re having fewer children later in life, there are fewer people entering the workforce—certainly not enough to replace the flood of baby boomer retirements to come.
After the 2008 financial crisis, companies coped with the financial stress by sacrificing their workforce—and work/life balance went out the window, said Duxbury. The work still got done but at a significant personal cost: employers simply turned up the pressure and heat on their existing employees, who didn’t realize they were becoming “boiled frogs,” she added.
And companies haven’t really changed their mentality since then. “You’re doing more with fewer people,” Duxbury said. “They’re donating their personal time to the organization.”
But that’s not going to work as a long-term strategy, since different generations in the workforce have different priorities. While the baby boomers were willing to work long hours and actively sought promotions, the generation now entering the workforce just isn’t interested in working itself to death, Duxbury explained. These employees want to take care of themselves first—which is good for them, but more challenging for employers.
Since the first baby boomers were eligible to retire in 2008, the problem is only going to get worse. “For every baby boomer who leaves the labour market…we need three younger people to replace two older people,” Duxbury said. “Because they will not sell their soul to the devil.”
The labour shortage is compounded by the fact that there’s a mismatch between the skills today’s workers have and the skills employers actually need, Duxbury added.
People are staying in school longer to pursue higher education in the arts or sciences. But this means there aren’t enough people learning trades and becoming plumbers or electricians. Because of the skills mismatch, by 2016, we’ll actually be short 800,00 employees—yet 400,000 people will be out of work, Duxbury explained.
The message to employers is, the competition for good workers is going to get a whole lot fiercer going forward. Employers that don’t offer appealing compensation and benefits—along with reasonable work/life balance—could see their talent disappear to other organizations or even abroad, Duxbury noted. “The competition is now global.”
For many companies, this means rethinking how they run their businesses. “You are never going to get talent if your focus is return on investment—shareholder value—over people,” Duxbury added.