Business must confront the economic and social challenges associated with the population ageing, sooner rather than later. Supporting higher levels of workforce participation, particularly of mature-aged people, is an important step in dealing effectively with the demographic challenges facing us.
We must challenge the entrenched life-cycle mindset that sees a one-way path from full-time education to full-time work to full-time retirement. This is at the heart of the cultural change that needs to underpin the measures recently announced by the Treasurer.
To respond effectively to the challenges presented by an ageing population, we must bring about a shift in attitudes towards older workers similar to that achieved towards working women.
There needs to be greater recognition of the benefits mature-aged workers bring to a workforce. This means tackling inaccurate and negative stereotypes.
It is also about recognising that the labour pool is shrinking and that our customer base is ageing. As a result, business needs to attract and retain a greater percentage of older Australians, both to maintain a skilled and experienced workforce and to better match customers with customer service.
Changing the attitudes of those doing the hiring and firing, though, is not enough. Driving cultural change throughout an organisation will mean that mature-aged workers are valued and provided with ongoing opportunities for training, skill development and interesting careers.
However, supporting higher participation is a shared responsibility. Individuals also need to better understand the benefits of staying at work - financially and in terms of broader wellbeing - and the need to maintain and improve their skills and employability over time.
From a financial perspective, individuals are far better off staying in the workforce even for only a couple of extra years. Staying in the workforce for an extra two years can extend the life of your superannuation savings by seven years. This is because your retirement saving continues to grow rather than being eaten into.
The Business Council of Australia (BCA) was pleased to see the focus given to the relationship between skills and labour force participation in the Treasurer's discussion paper. Education and training is the council's top policy priority. Mature-age workers who maintain and develop skills that will keep them competitive in the labour market have the most to gain.
While the focus on raising mature-age participation in the workforce is important, encouraging participation across the entire population compounds the benefits. From our perspective, this means ensuring younger Australians complete 12 years of education or the equivalent in other forms of training. It means supporting life-long learning. And it means helping individuals to recognise that they cannot disengage from the workplace, and avoid training and new job challenges.
Relative to our economic peers, workforce participation rates are low in Australia. This is particularly evident for those who are 55 and over.
Increasing participation will help Australia sustain strong economic growth and fund high-quality health and aged-care services. For individuals, staying in the workforce can help finance a high quality of life in retirement, and contribute to emotional and physical well-being.
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