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Biggest survey of Danish companies on demographic change shows Danish companies are below European average in analyzing age structures, but have most positive attitude towards older employees – skill shortage a growing problem
Copenhagen, Denmark – December 10, 2008:
In a survey of 5000 companies in 11 European countries on the consequences of demographic change, Danish companies are the least worried about the ageing of the workforce: only 25% (down from 35% in 2007) of Danish companies consider demographic change to be one of the most important challenges of the future, compared to an average 47% of companies in Europe1. Also, fewer Danish companies have analyzed the age structure of their employees, a prerequisite to prepare for an ageing workforce: only 22% know the age of their staff, compared to an average 40% in Europe. Yet, of all countries surveyed, Danish companies have the best attitudes towards older employees: 20% hired more people 50 and older than in the previous year (European average: 10%) and 16% plan to hire more people of that age group in 2009 (European average: 9%). Those are results of the Demographic Fitness Survey conducted by the Adecco Institute and presented today by Adecco Denmark.
Following interviews of HR managers, the results of the survey are used to calculate a Demographic Fitness Index (DFX). This index measures the preparedness of companies to cope with demographic change. On a scale of 400 points, Danish companies this year reached 183 points, down from 185 points in 2007, putting Denmark into fifth place of the 11 countries surveyed. The other countries’ scores were: Sweden 196, Norway 194, Germany 186, UK 186, the Netherlands 183, Belgium 182, Italy 182, Spain 180, France 174, Switzerland 172.
“Although in a European comparison, Danish companies are still doing relatively well, they have lost ground and time with regard to preparing for a shrinking and ageing workforce. The lower score clearly corresponds to the lower priority given by Danish companies to demographic change. This trend should be reversed if Danish companies do not want lose their ability to innovate and compete. The goal of establishing the DFX is to raise companies’ awareness of the demographic challenges lying ahead of us. A lesson from the financial crisis is to rediscover future planning and to pay more attention to early warnings. To prepare for an ageing workforce is nothing that can done from one day to another, at some point it is simply too late. It takes strategic measures and a long-term HR planning horizon. For this, the survey’s results offer valuable insights that help companies understand the issue and take specific action”, says Gitte Elling, country manager of Adecco Denmark.
The ageing of the Danish population and workforce is an irreversible fact. In 2000, 19.8% (EU: 20.3%) of the Danish population were 60 and older. By 2010 that figure will be 23.4% (EU: 21.9%) and will by 2025 have risen to 28.1% (EU: 27.6%). Despite this growth of the older population, Denmark fares better than other European countries. The share of the 25 to 59 age group of the total population will only fall from 61.7% (2000) to 55.6% (2025), the share of young people between 15 and 24 will approximately remain the same, whereas in most other European countries that age group will shrink. (Source: UN World Population Prospects)
This might be an explanation why Danish companies are less worried when asked about future challenges: whereas European companies on aggregate say that globalization poses a major challenge (56%) followed by technological progress (53%) and demographic change (47%), the HR managers of Danish companies rate those issues as smaller challenges: globalization is considered a challenge by 45% of companies, followed by technological progress (40%, up from 35%), with the importance of demographic change dropping from 35% to 25%.
The DFX measures five key areas of HR management that influence a firm’s ability to successfully cope with an ageing workforce: career management, lifelong learning, knowledge management, health management, and diversity management. The indices are calculated based on the answers given by 350 Danish firms of all sizes and sectors. The aggregate of the company results is the country index.
In the pan-European comparison, Danish companies are slightly above average in career management and almost exactly average in lifelong learning, with a drop in the average number of days per employee spent on continued education and advanced training from 8.3 days in 2007 to 6.9 days in 2008. Still slightly above European average but less efforts compared to last year are made in knowledge management, especially in documenting business-critical knowledge.
Clearly below average is the knowledge about the age structure of the workforce. Only 22% of Danish companies know the age of their staff, compared to an average 40%. Probably because Danish companies see less of a danger in demographic change than most of their European counterparts, less importance is attributed to a comprehensive analysis of the age composition of their employees.
Danish companies suffer from skill shortages, but on a lower level than companies in most of the rest of Europe. The biggest skills gap Danish companies complain about is that in technical and engineering skills. (30% of Danish companies are having difficulties here compared to 35% of European companies). This illustrates that Denmark cannot escape the consequences of an ageing workforce, but with their markedly different attitude towards older employees, Danish companies seem to have found a way to ease those shortages and are clearly ahead of all other countries in hiring people 50 and older.
The relatively optimistic outlook of Danish companies into the future has not led to a long-term staff planning. In Denmark the advance planning of staffing needs is exactly the European average of 1.1 years.
1) The survey was conducted in 11 European countries and is repeated annually. The European average – unless stated otherwise – refers to the average results of the five biggest economies in Europe: Germany, France, the UK, Italy and Spain.
About the Adecco Institute
The Adecco Institute, founded in 2006 and based in London, is a think tank on the future of work; it is committed to facilitating discussions on the topic of work. Through primary and secondary research as well as white papers and forums for discussion, the Adecco Institute provides forward-looking approaches to help companies and economies raise employability, productivity and employee satisfaction at work. The Institute is chaired by Wolfgang Clement, former German Minister of Economics and Labor. For more information please visit:
www.adeccoinstitute.com
Media Contact:
Shepard Fox Communications
Axel.Schafmeister@shepard-fox.com, Telephone: +41 78 714 8010
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