Tasmania’s ageing population creates an abundance of opportunity for our youth.  The ability to transform that opportunity into reality however will require significant investment – including foresight, planning and commitment.

Population ageing is more often than not viewed negatively.  This is an over-reaction.  Population ageing presents challenges resulting from change.  Just like any change, government and society need to adapt and innovate to capture the opportunities attached to that change. 

The problem with population ageing is not that there are too many older people but that there are not enough young people to 1) provide the products and services required by a changing demographic and 2) pay tax to fund the increasing demand for publicly funded services (e.g. health and aged care and pension entitlements).

The below figure illustrates the imminent loss of workers from the Tasmanian labour force due to retirement (or exit from the workforce), the immediate replacement labour (those aged say 25 to 45) and the imminent labour market entrants - our youth.  Each of these cohorts are significantly smaller in size than the cohort exiting the workforce. 

As a State we need to invest in each of these successive cohorts to ensure the opportunity for labour force participation, skill utilisation and productivity is maximised.  

Over the next 15 years in Tasmania over 100,000 workers will exit the workforce (based on the average age of retirement over the past five years - 61.5 years - as identified by the ABS in their Retirement and Retirement Intentions Survey).  This exodus creates employment opportunities for our youth.

Some of the jobs of these older workers may need to be replaced, some may not, but an older population will also transform the consumer market and require new jobs to be created. 

In Tasmania, we do not have enough people in the younger population (aged under 45) to replace these older workers, highlighting the critical importance of ensuring we shape and nurture our youth to take advantage of these opportunities. The ratio of labour market entrants to labour market exits in Tasmania is less than one, and has been since 2011.  This means that for every person aged between 55 and 64 (assumed labour market exit age) there is less than one person aged 15 to 24 (assumed labour market entry age). This ratio is projected to continue. In addition, this measure of future labour supply does not consider the complement of education, training, skills and experience which will be essential from a potential working population.  

This is where smart, timely and informed investment in education, training and skill development is required.  As a State, we have a window of opportunity to to get it right.  

There are a number of things that need to happen to capture this opportunity:

1) Recognise that ageing workforces will result in a transformation of the workforce from one which is older with lower levels of educational attainment but life long experience to a younger workforce with high(er) levels of educational attainment but lower levels of applied work experience.  
2) Industry, regions and organisations need to undertake extensive workforce planning to identify future demand, profile their workforce (by age, occupation and exit intentions) and identify critical job roles which have the potential to impact on growth and training capacity and then invest accordingly. 
3) Acknowledge that wealth creating industries may not necessarily be job creating industries. As such it is important not to ignore the domestic economy and the demand within the population.  There is already a deficit in the provision of care with an ageing population and the roll out of the NDIS will extend this deficit.  Care related jobs are real jobs, with real skills and real wages.  
4) Ensure investment in education and training is informed by demand - i.e. industry led with an employment outcome. This will increase efficiency in education and training investment and reduce the mismatch between educational attainment and job creation.
5) Recognise that social services, equity policy and 'second chance learners' also deserve an employment outcome opportunity.

Tasmania's ageing population is creating employment opportunities - both in replacement labour for ageing workforces and changing demographic demand - but the ability to capture this opportunity is dependent upon ensuring that investment in education and training matches changing employment demand.  Our youth are not round pegs who will fit into round holes - they need to be appropriately shaped.  
 

Understandably, youth unemployment has been the topic du jour this week.  Many have offered insights into causes and solutions, based either on supply or demand side arguments.  

On the supply side, causes are identified as lack of appropriately skilled and experienced youth who are work ready with an acceptable work ethic.  On the demand side,  there are few jobs available in Tasmania for our youth.  From the perspective of solutions, on the supply side is to increase investment in educational attainment and on the demand side, create confidence in the economy and thus jobs.

While from a helicopter view, these explainers for the causes and solutions of high levels of youth unemployment are well supported, greater understanding of the interaction between education and its influence on employment outcomes is required.  

Critically there is a misconception about who of our youth is unemployed.  Assumptions are that it is those who have low levels of educational attainment, particularly literacy and numeracy.  While there is a proportion of our youth who do fit this description, there are many recent graduates (and not quite complete apprentices) who fill the unemployment queue, particularly in Tasmania.  This is primarily due to the mismatch between educational qualifications and employment opportunities, including whether or not educational qualifications prepare an individual for the workplace.  Many argue that tertiary education does not.  This leads to our youth being overqualified and under-experienced.  Eventually these overqualified people leave the state, adding to our population challenges.

Even tertiary educated individuals require on-the-job training to get them in a position where they make a positive, productive contribution to the business - this period of training is an investment (cost) to the employer and can take many years to achieve (around three years for most occupations).  In order for an employer to take on either an apprentice/trainee or a recent graduate they need confidence in the (long term) market to achieve a return on this investment. In Tasmania three years is a long time to invest getting an employee to productive stage.  It also means freeing up resources (skilled people, time and money) to train individuals, meaning those resourced are also not fully productive.  

So what do we do?  Take a step back and reassess - focus on three areas of responsibility: education, integration between education and employment and employers. 

1) The foundations of literacy and numeracy are critical.  Unless these levels meet national standards, employment will be difficult for individuals (at any time of their life).  Our youth needs to want to be educated.  They need to be surrounded by jobs to which they aspire to do, jobs which require completion of year 12 and further education. High school must go to year 12.  Subject choice needs to be reduced.  The foundations of education; literacy, numeracy, problem solving, critical thinking, expression and creativity are the priority.  A large subject choice narrows students abilities and choices in the future.  In an economy always changing and with occupations no longer guaranteed to exist in 10 years time, our youth need solid foundation skills and abilities. This will widen their opportunities in the future. 

2) There is complete miscommunication between industry and education providers with regard to skills and abilities required in the workplace, partially to blame is the way in which education is funded.  In any case, both industry and education providers have a responsibility to each other, to prospective students and employees about expectations and outcomes.  

Efforts to improve educational attainment are evident, however, the recently signed MoU between TasTAFE and UTAS includes increasing the level of educational attainment and the number of completions, however, it does not include securing employment by graduates in its scope.  There is little point the state investing in the education and skill development of Tasmanian-based students if they can not be retained in the state (essentially we are investing in the future prosperity of another state).  Furthermore, while UTAS has introduced a formal internship process for international students with the objective of retaining them in the state upon completion, aimed at completing the link between education and employment, the same internship process is not available for Tasmanian students.  

3) Employers also need to adapt and compromise.  This is particularly evident in the type of entry level jobs offered to our youth.  While our teaching styles have evolved over time to encourage independent thinking, using initiative and problem solving, entry level jobs have not adapted to these new skills and abilities offered by our youth (I wrote more about this here).  Accusations of youth being transient and unloyal are the direct result of lack of job security offered in employment.  While businesses mitigate against future risks by offering less than permanent employment, youth also mitigates their risks by continuing to pursue employment opportunities which will provide security (or increased experience).  

A final, important point, is that our youth are our future, and always will be.

Solutions to the challenges of population ageing forget about the opportunities provided by our youth and future generations.  As we enter a period of time in which there will be more labour market exits (due to the large cohort of baby boomers reaching retirement age) than labour market entrants, maximising the utilisation of the available supply of labour is paramount.  In Australia, the focus is on increasing the labour force participation rate of women and older ages (as well as productivity).  This solution does not consider the contribution of youth at all.
 
In fact, since the early 2000s Australia, and to a lesser extent, Tasmania, has been experiencing a mini-baby boom.  Critically, this cohort of children will enter the labour market as the last of the baby boomer reach retirement age (around 2023).  This generation is what my colleagues, Brendan Churchill and Natalie Jackson, and I call the Thank God You're Here Generation (Gen TGYH).  Gen TGYH will be the replacement labour that we are so desperately seeking.  However, they are not round pegs who will fit in round holes (left vacant by baby boomers).  Gen TGYH need to be shaped and nurtured to meet our future needs.

It is the responsibility of parents, educators and employers to ensure that Gen TGYH and subsequent generations have strong foundations on which to build knowledge, skills, flexibility and adaptability as well as build a career.   

Much debate exists around why youth unemployment is the highest of all age groups in Australia, with employers complaining that Gen Y has no work ethic, is disloyal,  arrogant, has unrealistic expectations and want it all.  General consensus is that society and educational institutions are failing to prepare 'work-ready' future generations.

The reality is, however, that successive generations are the product of the environment they were born into and spend their formative years.  This is particularly evident as the value of education becomes increasingly important. As the importance of education increases so too does the pressure on education providers to produce a quality product, so much so that teaching and learning practices are continually evolving to meet these demands.  Students are now encouraged and nurtured to develop ways of creative and independent thinking, problem solving and critical analysis.  Even before children start formal education, playgroups and childcare centres are fostering a culture of 'play-based learning' encouraging imaginative and creative play, utilising both the left and right sides of their brain. Our youth is experiencing a contemporary learning environment which encourages challenging the status quo - questioning the who, what, where, why and how. 

However, our workplaces have not evolved in the same way.  Entry level jobs prescribe how to do a job, where and when to do it and why.  The workplace experience is a total discord to the empowering educational experience Gen Y are provided to foster innovative thinking.  Organisations have not adapted to capture the new skills and thought processes which accompany Gen Y (and future generations) into the workplace. Job roles have remained stagnant and thwart any potential productivity gains attached to the skills and abilities of younger generations (which is critical in replacing a large, ageing workforce). Critically, Gen Y are not round pegs to fit into round holes left vacant by obsolete jobs or retired baby boomers.  While jobs have evolved as a response to the demands of new technologies and related opportunities; workplaces, structures and job descriptions have not.  Maintaining the historic trend and status quo attached to job design and workplace hierarchies inhibits the potential attached to the future supply of labour and their associated educational asset.  Evolution needs to occur concurrently - education, jobs, job design, workplace structure and culture.

While the education system appears to be preparing our future generations for the changing needs of an economy transitioning from an industrial-based economy to a knowledge, service based one, our workplaces appears to be failing to keep pace with the opportunities attached to our successive generations. The focus should be on achieving both contemporary educational outcomes and contemporary, productive workplaces rather than retrofitting Gen Y to out-dated workplace practices. 

I would like to provide you with my ‘wish list’ for the future provision of education in Tasmania.  These are simple dot points which I would be happy to expand on if you require further clarification.

1.       That all schools; rural, regional or urban provide education to year 12
2.       That the provision of education services be demographically informed
3.       That the provision of education be aligned with the industry make-up within the relevant rural, regional or urban context
4.       That a first class transport service be provided to students
5.       That education services be integrated with LINCs, post-school education providers (vocational and tertiary) and other education and training providers.
6.       That other public services be integrated with the provision of education so that employment opportunities and optimal health is ensured
7.       That the provision of education services are integrated on a long term basis with the State and Regional Economic Development Plans as well as the Industry Diversification Plan resulting from the Tasmanian Forests Intergovernmental Agreement. 

Historically, Tasmania has always experienced net migration losses in the younger education and working ages of 15 to 29 years as a direct result of a lack of education and employment opportunities. This is particularly exacerbated in rural and regional areas of the state where schooling is not often provided beyond year 10 and where there are no post-school education options at all.  Yet, at the same time, much of the state’s contribution to economic growth is sourced from industries in these rural and regional areas.  This results in a serious mis-match between supply of labour and demand for labour - particularly educated, skilled and experienced labour.

I believe that the above dot points can be achieved through a strategic approach to integrate education with economic development through the provision of infrastructure, services and amenities.  Following the process of identifying potential industries and areas of economic growth, investment in ‘infrastructure hubs’ should be a priority.  These hubs should include the provision of education to year 12 as well as vocational and tertiary (utilising LINCs and the NBN), health, transport and recreational services, including services such as aged, disability and child care and cater to the needs of the sub-population.  The need for these hubs should be informed by the population demographics, the industry make-up and the prospects of the region. 

An infrastructure hub approach to the provision of public services has the potential to provide opportunities to Tasmania and Tasmanians not previously possible, including reducing the disbursement of the population, the opportunity for critical mass and economies of scale.