trends and preparation for the future|
INSTITUTE OF TECHNOLOGIE TRALEE
Bachelor of Business in Management
Strategic Human Resource Management I
Due Date:October 22, 2010
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table of contents
table of contentsI
4.preparation for the future3
Changing workforce demographics are having more and more effects on companies. The shift in employee demographics causes an important number of issues to many organizations. In almost all activity sectors, numbers of employees are retiring, leaving with them a huge amount of knowledge, skills and experiences. That’s why managers should prepare the future in observing the demographic trends and identifying action areas with adequate measures to handle the demographic trends. New strategies are obviously required to face to the demographic changes. Employers should think about retaining their mature-age workers instead of hiring young graduates. Companies should also focus on lifting the skills of the existing workers. Training system is one of the most relevant ways and they must rethink their management strategies in assessing their current workforce in a way to take a look on their strengths and weaknesses.
Contemporary and in the following years the age structure in developed economies of the western world is changing. The citizens are living longer, more and more are living alone and increasingly have fewer children. Research results of Booz & Company have shown that globally live expectancy is expected to 78 years in 2020, up to 82 years in 2050. Next to that, the birth rates are declining. To maintain the current population, it is required that every woman has 2.1 children, but today the birth rates in Russia for example are already by only 1.4 children per woman. Even though the population in the United States is increasing, the active workforce (humans aged 18 to 64) is currently decreasing, because of the retiring wave of the baby boom generation. In approximately 20 years almost 20% of the American will be 65 years or older. In Western Europe you can detect the problem of a declining population what leads to the same trend like in the United States: older and smaller working populations. Regarding to this, for example the active workforce in Germany is decreasing by nearly 30% by 2050. The demographic shift in the population is coming and its impact on the industry sectors is indispensable. The mission of the companies should be clear – handling the demographic trends now by implementing the right measures and activities in the Human Resource Management (HRM). Only companies with a focus at that terrifying development, influence their future success, maintain their competitiveness and improve their future survive. The following demonstrations illustrate first of all the major demographic trends in the next years. The subsequent part describes the main action areas (workforce planning, flexible work arrangements, compensation, learning and development, healthcare management and corporate culture) for the HRM and the adequate measures to handle the demographic trends best possible on these areas. In the section of the conclusions the reader turn into an assess of the evidence. The recommendations with proposals for further actions complete the closure of the report.
It is not a secret that the long-term cost of human capital is increasing and the labour pool is decreasing which lead to a war for the best talent. But a...