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Australia
Melbourne, 16 December 2008

A report released today by global consulting, outsourcing, and investments firm, Mercer, warns that the global financial crisis could mask the risk of long-term demographic trends.

The report – Workplace 2012: beyond the Global Financial Crisis – includes updated modelling of Australia’s workforce in 2012 that confirms relief for employers from an on-going skills shortage and ageing population will be short lived.

The Mercer report includes updated modelling based on economic data from February to October. Mercer commissioned economic consultancy, Econtech, to model scenarios looking at the impact of recent immigration policy changes and the impact of changing commodity price expectations.

Key findings of the report include:

• By 2012 the number of individuals in Australia’s labour force aged 55+ will increase by 15.4 per cent, while the number of workers aged 25-54 will only increase by 6.3 per cent.

• The number of women aged 55+ in the labour force will increase by 17 percent compared with a 9 percent increase in women aged 25-54.  At the same time the number of men aged 55+ will increase by 14 percent compared with a 4 per cent increase in the number of men aged 25-54.

• If commodity prices recover more quickly and strongly than expected the unemployment rate will be 0.2 percentage points lower in 2012 than would otherwise be the case.

• Latest forecasts finalised in November indicate unemployment will rise above five per cent in 2009 and be around 5.2 per cent by 2012/13.

Mercer’s Chief Executive in Australia, Mr Peter Promnitz, said the global financial crisis won’t prevent an ongoing labour and skills shortage and warned that employers have to plan now for an economic recovery.

“If employers are blinded by the global financial crisis they risk destroying a viable and productive future workforce.

“If you cut too deep – or in the wrong places – now, you will jeopardise your future success.

“Now could be the time to get ahead in the war for talent,” he said.

According to Mercer’s Workplace 2012 report older workers will be critical to success in an economic recovery.

“By 2012 the percentage increase in the number of workers in our labour force aged 55 or older will be more than twice that of those aged 25-54,” said Mr Promnitz.

“We acknowledge that attraction and retention of older workers will not be a priority for many employers right now – but, the global financial crisis will not stop an ageing workforce and older employees can offer experience and corporate memory often critical to successfully re-building a business outside of the economic crisis.

“Having the right people in the right roles at the right time could be a determining factor in whether a business survives the economic downturn. At the very least, it will affect how quickly a business can recover,” Mr Promnitz said.

Mercer’s report confirms that an increased number of skilled immigrants will increase both supply and demand of labour but will not eliminate the challenge of an ageing workforce and skill shortage for employers.

“The global financial crisis brings the challenge of re-shaping the workforce into sharper focus. Employers cannot ignore longer-term issues such as significant demographic changes for the sake of reacting to immediate financial issues,” said Mr Promnitz.

About Workplace 2012

Mercer's Workplace 2012 is a series of research, industry forums, analysis and leading thinking about tomorrow's business trends and the impact on business today.

For further information and a copy of the report visit our dedicated website: www.mercer.com.au/workplace2012

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