30/11/2011 - 11:12

Finding the right workers to boost growth

30/11/2011 - 11:12

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Amid all the noise about skills shortages is a long-term challenge about how business will meet its future staffing needs.

Amid all the noise about skills shortages is a long-term challenge about how business will meet its future staffing needs.

THE world is crying out for Australia to grow faster and offering us prices for our natural resources that we have never seen before. Quite clearly this external pressure point has had a direct impact on the demand for skilled labour, particularly in Western Australia.  

While these conditions might be good for some, it’s clear that current approaches to talent acquisition and retention are not sustainable.  

More than an unsustainable practice, buying labour at almost any cost reflects an imperfect understanding of the labour market. It shouts: ‘Easier to fish from the same talent pool than invest time and energy reaching broader pools of talent, or indeed, adapting workplaces to reduce talent leakage’.  

To be fair, taking a more thoughtful approach is difficult given the white noise about labour scarcity, noise that has reached a deafening crescendo in WA. It’s hard to push the pause button, or fast-forward to the logical outcome of the current response when we are in the midst of frenetic activity.    

Our view is that when and how we respond to the skills shortage will change the game for the Australian economy and businesses. With this in mind, Deloitte set out to think through the options to both solve the skills problem, and boost growth prospects. 

Our discussion paper ‘Building the lucky country – Where is your next worker?’ identifies 12 responses built around the GDP drivers of population, participation and productivity covering areas as diverse as: education; the ageing workforce; skilled migration; offshoring; and employee retention and engagement.  

More than an academic exercise, we want to start a new dialogue with business and government about practical change strategies. Given that the mining industry has relatively low female participation rates as well as a lower than average retirement age, we think these two labour pools are particularly pertinent to WA and a good place to start the discussion.

But is it really worth it? Let’s take the gender issue first. 

According to Goldman Sachs (‘Australia’s hidden resource: The economic case for increasing female participation’), the answer is yes.  

Goldman Sachs estimates that if Australia can close the gap between male and female workforce participation rates, Australia could lift GDP by 13 per cent, or $180 billion. How can this be? 

In Australia, women represent a highly educated and experienced pool of labour. Indeed Australian women are more highly educated than men; in 2010, 83 per cent of women aged 20-24 had finished year 12 compared to 73 per cent of men, and women are more likely than men to be university educated. 

And of course women are experienced employees; 59 per cent of women participate in the labour market compared to 72 per cent of men (interestingly women aged 15-19 have higher levels of workforce participation than men).  

But this pool is under-utilised. Women work in a narrow range of industries – often called the pink ghetto of services and operate in the ‘nappy valley’, as named by the Australian Bureau of Statistics, by working part-time or exiting the workforce entirely during years of child-bearing or child-rearing. 

Within each of these dimensions, namely occupation, hierarchy and hours of work, lies an opportunity; an opportunity to think about moving women laterally between industry silos, progressing women to senior levels, and increasing hours of work through better use of flexible work practices.    

Quite clearly accessing this pool of talent will require new attraction strategies, and even more so, cultural change to retain that talent; reorienting traditional approaches to the acquisition and retention of talent takes time.  

It takes time to get stakeholders on board by documenting the impact of the current state, time to get serious and implement strategic changes, and then to capture the advantage.  So it’s not a quick win, but it is an approach that will have ripples beyond the attraction and retention of women in the workforce.  

As we alluded to above, mature-age workers also represent an under-utilised pool of labour. Over the next 20 years, as increasing numbers of people retire, their knowledge and skills will be lost and this will only accelerate as the baby boomer bulge reaches retirement.  

Clearly this is another sizeable labour market opportunity.  Indeed Deloitte Access Economics estimates that in 2030, 5 million of us will be 55-70 years of age, but only 1.73 million of us will be in the workforce that year if we keep on doing what we are currently doing.  

And what exactly are we doing? Making it hard for people to stay or giving mature-age workers a little push and then, quite firmly, closing the recruitment door. 

This approach seems a little naïve when we know that the traditional pool of new hires is dwindling. In the next five years fewer than 125 people will graduate from educational institutions for every 100 people retiring – the highest ratio of job market retirements to new entries in Australia’s history. 

Deloitte’s discussion paper, ‘Where is your next worker?’, suggests that current approaches to talent acquisition and retention, characterised by ‘who pays the most wins’, are not only unsustainable, but flawed. 

While those businesses that are actively looking to the long term have accepted the necessity of attracting diverse pools of talent to fill the gap, fewer have taken the more difficult step of identifying the hidden barriers that prevent these employees from participating to their full capability and at the highest organisational levels.  

This means much more than developing a glossy advertisement or HR policy promoting diversity – it means creating an inclusive workplace; a workplace where everyone feels they belong and that their contributions are valued, a workplace based on merit and respect. 

In a nutshell, a workplace that is adaptive to the diverse needs of its diverse employees rather than a workplace that forces square pegs to fit into round holes.  

In practice this means simple things like actively staying in touch with women when they take maternity leave, providing meaningful work and opportunities for promotion for people using flexible work practices, and challenging assumptions and stereotypes. 

It also means developing meaningful key performance indicators and rewards for managers who foster collaboration, understanding the underlying company culture, and examining the physical demands of a workplace to find reasonable ways to support healthy ageing.  

It is the cumulative impact of these behavioural and organisational changes that will mean employees from these talent pools will accept the employment value proposition and seek employment, or remain with, an organisation.   

The traditional workplace, with its rewards, structures and processes, has served us well. It has brought us to 2011 but it needs to adapt for Australia to continue to grow and prosper.  

We need new thinking about business operations, sources of talent, and the way we acquire and retain this talent. If we focus on diverse talent pools we will achieve both of these goals.

Why? Because diverse talent brings diverse skills, perspectives and insights and when these are leveraged business will be able to provide improved customer service, open new markets, be more productive and develop diversified products.  

Cutting through the background noise is critical and urgent. It is those organisations that reframe the skills challenge as a unique business opportunity that will be the ultimate winners.   

• Juliet Bourke is the national diversity leader in human capital with professional services firm Deloitte and Julie Harrison is a human capital director with Deloitte’s Perth office.


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