Data from the U.S. Bureau of Labor Statistics show that the proportion of people younger than age 24 in the U.S. labor market is lower than at any other time since participation rates were first tracked more than 60 years ago. At the same time, the data show that workers age 50 and older are being employed longer—many working well into their 70s—than at any other time during those 60 years.
The large proportion of young people out of the workforce and the greater number of older employees will have wide-ranging economic and social implications. These demographic trends could influence how HR professionals conduct career, leadership and workforce planning in the coming decade.
Job seekers of all ages have endured a tough job market throughout the recession. But some patterns are different for each age group. For example, federal data show that while older workers were less likely to lose their jobs during the recession, younger job seekers spent less time being unemployed.
Lower labor force participation rates for young people are likely to be related to a number of factors. Graduating or entering the labor market in the midst of one of the worst recessions in U.S. history has made it extremely difficult for first-time job seekers to gain a foothold in the workplace. Many are further delaying their entrance into the job market by obtaining more education in an effort to be more competitive.
High rates of unemployment among young people have weighed down the economies of many European nations during the past decade. The United States may now be experiencing similar stagnation, with potentially comparable social consequences likely to ensue. For example, the differences in theexperiences of younger vs. older job seekers during the recession may result in generational differences within the workplace that influence workforce planning.
There is some evidence that HR professionals in the United States are now getting more focused on workforce planning as the economy improves and the first Baby Boomers begin to retire. A November 2010 Society for Human Resource Management-AARP poll found that:
- 53 percent of the respondents conducted, or plan to conduct, a strategic workforce planning assessment during 2010-11 to identify skills gaps, compared with only 38 percent that did so in 2008-09.
- 42 percent of HR professionals said they have analyzed, or by the end of 2011 plan to analyze, the impact of the retirement of workers age 50 and older on their organizations.
- 39 percent of respondents said they are just beginning to examine internal policies and management practices to deal with potential shortages of younger workers when older workers retire.
National U.S. demographic and employment data suggest that there may be many younger job seekers eager to secure stable positions in the coming years. But a large number of these job seekers may have little work experience. Helping these young people succeed will be critical for businesses and for the U.S. economy.
Jennifer Schramm is manager of the Workplace Trends and Forecasting program at SHRM.