Managing an aging workforce—how your business can respond
3-minute read
We all know Canada’s population is aging. But how will changing demographics affect your business?
First, the good news. Aging consumers have different buying habits, so that means many opportunities for creative entrepreneurs.
The bad news? As baby boomers retire, many businesses will face labour shortages because not enough younger workers will be around to take their place.
Either way, businesses that don’t adapt to the reality of the aging population could face severe challenges and miss opportunities, says Pierre Cléroux, Chief Economist at BDC.
The impacts are already being felt in some sectors and regions where businesses are struggling to find younger employees to replace retiring baby boomers.
"If we don’t manage our labour force according to the new trends, it’s going to be difficult for businesses to be successful," Cléroux says.
Retain older employees
To deal with the coming labour crunch, you can start by creating a more accommodating workplace to entice aging employees to put off retirement, Cléroux suggests.
Older workers often can’t or don’t want to work full-time. Flexible hours, part-time jobs and temporary work are ways to keep them on board. Some companies also recruit seniors to fill labour gaps.
"Older workers usually have a great work ethic and experience," Cléroux says. "Businesses will need to keep their people working for them longer. The perception is that at 65 people are done. That perception will have to change."
Businesses that want to retain older workers should consider dropping the mandatory retirement age—if they have one—and offer retirees flexible, part-time and temporary jobs. It’s also a good idea to pair people who are about to retire with younger workers to pass on skills.
Another solution is immigration, which has always been important in addressing labour shortages in Canada.
"Businesses will have to be more flexible in accepting people trained, educated and born outside Canada," Cléroux says.
Boost your productivity
Because many Canadian companies aren’t as productive as their international competitors, they require more workers to produce the same amount of goods and services. An ageing workforce means Canadian companies will have to boost their productivity to continue growing.
But improving productivity isn’t about working more hours or putting in more effort. It’s about finding more efficient ways of producing goods or services with the same amount of effort.
Raising productivity in your company requires focus and investment. You have to foster a culture of innovation and invest in operational efficiency, equipment and technology.