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What will a loss of experience in the workforce mean for the economy?

Image Credit: Light photo created by Racool_studio

There has been plenty of debate about the lack of attention to women and to people over 35 in the Government’s recent budget. What has been missing from the conversation is what a loss of experience in the workforce will mean for the country’s future and for the climb out of recession.

The economy desperately needs the experience of mature workers at this time, but few are considering what a mass exodus of older workers means in terms of the loss of company knowledge, client management, mentoring and business know-how. There is not much attention paid to it, but there is now significant evidence to suggest that a multi-generational workforce is far more effective in solving complex problems like the ones we currently face by pairing the the wisdom of experience with the fresh eyes of youth. Multi-generational teams are generally more agile and able to respond quickly and effectively to market opportunities and challenges.

For businesses in industries with small margins that have been hit hard by the pandemic, the wage subsidy poses a “social dilemma”.  One small business owner told me that in the light of the wage subsidy offered, he was being forced to reconsider the balance of older and younger workers as he tries to get the business profitable again even though he values maturity.

The long view is important, even in difficult times. Business leaders I have spoken to reiterate the message that mature employees foster collaboration, provide access to extensive networks developed over long careers, and are the repository of significant business knowledge.

 Leaders particularly emphasise the importance of relationship management, a skill that is highly valued and can take years to really master. Businesses need mature people who relate well to clients and stay with the business. The last thing they need is for clients to come in and see a different person every time, so the stability offered by older workers is valuable.

For businesses that have weathered the pandemic well, and recognise the value of a multi-generational workforce, the wage subsidy will make little difference to their mix of older and younger employees. But if the global financial crisis is anything to go by, even without the challenges posed by the wage subsidy announced in the budget, we know that many mature-age professionals will find it difficult to get work and some may never work again. 

Stories abound about the impact of job loss and business closures. Among experienced workers, those lucky enough to find work often end up in jobs well below their skill level. While that may help them survive in the short term, it is not good for productivity. The incentives outlined in the budget can provide pathways for younger employees and that is important, but they should not come at the expense of experienced workers if businesses want to be successful over the long term.

 

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