The Stats Guy:We’re heading for a retirement cliff. These are the jobs going over the edge

A large number of Australians will soon retire and their jobs will somehow need to be filled.

A large number of Australians will soon retire and their jobs will somehow need to be filled. Photo: TND/Getty

This column is increasingly turning into a collaborative effort.

When I shared last week’s column on my LinkedIn someone asked how the skills shortage of teachers compared to other professions. Great question. Let’s answer it!

The fun thing with the worsening teacher shortage was that we could roughly estimate future demand for teachers. A four per cent increase in the population of high school age is ideally answered by a four per cent growth of the number of people working as teachers.

We can’t quickly estimate the future demand for all jobs. We can however see how bad the looming retirement cliff in the coming decade is. The logic is simple: What share of all workers in a profession are already of retirement age (65+) and what share are about to retire in 10 years (currently aged 55-64)?

The Australian Bureau of Statistics (ABS) classifies 1300 jobs. For this exercise we only worry about the 850 jobs with more than 1000 workers.

I’ve put all the data into a big interactive table for you to explore. On a national level, 80 per cent of workers are aged 15 to 54, 15 per cent are aged 55 to 64, and five per cent are already of retirement age (65+).

Last week we saw how dire the skills shortage among secondary school teachers will be, but this table shows that the situation in the teaching profession is only slightly worse than the national average. Arguably the biggest shortage in the teaching profession will be among vocational education teachers.

Let’s explore the data to find out in which professions the steepest retirement cliffs loom.

Sorting the table to see what share of the workforce in each job is aged 65+, we first notice that in 14 occupations more than a quarter of workers are of retirement age (65+) already.

Some jobs, like crossing supervisor (49 per cent aged 65+) or bed and breakfast operator (34 per cent), seem to be ideally suited and actively sought out by retirees. These jobs won’t suffer from the retirement cliff, rather there will be plenty of new retirees available to fill potential jobs shortages. Let’s not worry about them.

If you want to play along, quickly sort the table to see which jobs have the lowest share of workers in the 15-54 bracket. This way we see which jobs are going to lose most workers in the coming decade to retirement.

Two job categories quickly emerge that should worry us immensely. Countless farmers and drivers of all sorts will retire very soon.

Food for thought

Beef cattle farmers, sheep farmers, sugar cane growers and livestock farmers are the most pressing examples in the world of agriculture. Who is going to take over these very important jobs? Feeding Australia and feeding the world are crucial economic and moral responsibilities.

Farmers work well into their retirement years. There are various reasons for the reluctance to retire. For one, succession planning is hard. For a farmer the farm is not just the place of work but also the family home. Farming is a both career and lifestyle choice.

Usually, it’s financial or physical pressures rather than age that convince farmers to retire. These pressures will eventually hit even the hardiest of farmers. Their kids won’t succeed them, many having pursued different careers and have no interest in taking over the farm.

In the case of agriculture, the retirement cliff will dramatically reshape rural and regional Australia. Farms will be sold and aggregated into larger operations. These fewer but bigger farms will need fewer farm workers to be just as (if not more) productive. Considering we are running out of workers that isn’t a bad development per se.

The social and population consequences in farming towns will be severe though. Fewer agricultural jobs will ultimately lead to smaller regional populations. Once a regional population falls below a certain threshold, a number of services become too costly to maintain. A local IGA might have to close, or the local footy team will struggle to find players.

Small regional towns face massive challenges due to the retirement cliff of farmers. Forward-looking local governments can see the writing on the wall and proactively take steps to soften these pains. Attracting population, economic diversification (easier said than done), attracting jobs, rezoning of land to make housing more affordable are common strategies – all uphill battles but crucial in retaining regional quality of life.

Driving … but only to the bowling club

Now let’s talk about people who drive vehicles for a living. Drivers are surprisingly old. Sort the table by the 55-64 column and you’ll see that five out of the top 10 jobs are drivers.

Who can blame young people for not looking at driving jobs as a career? Afterall there is so much talk about self-driving vehicles that an 18-year-old rightfully thinks twice before betting their professional future on self-driving cars not arriving too soon – especially if there are plenty of other jobs to choose from.

After speaking to people in Silicon Valley that work on the technology behind self-driving vehicles, I am convinced that Australia won’t have a significant number of self-driving cars in the next 15 to 20 years.

If my prediction is correct, we need to import a bucket load of drivers to Australia very soon. Truck drivers should be in particularly short supply in this scenario.

Over 148,000 Australians make their living driving all types of trucks. We will lose many of the 7 per cent of truckies that are already of retirement age in the coming decade and only a fraction of the 26 per cent of truckies that are nearing retirement age (aged 55-64) will be working in a decade.

On the upside, the current tendency of pushing truckies in their 50s out of the profession (this is when insurance claims for bad backs start to go up and insuring truckies becomes more expensive) will almost certainly stop.

Have a play with the table to understand how bad the retirement cliff will be in your industry. Always keep in mind that even jobs well and truly in the middle of the table will struggle.

To answer the question raised at the beginning of the column, teachers aren’t facing the worst skills shortage. It’s drivers and farmers that we will be running out of first.

There are also broader political implications from this data. I can think of no plausible government that, once looking at these data, would opt for a low migration policy.

The retirement cliff, like so many sets of data we explore in this column, also has a housing angle. The large number of people leaving the workforce, dictates a high migration intake, which in turn dictates high housing demand. Such a fun dataset to play with.

Demographer Simon Kuestenmacher is a co-founder of The Demographics Group. His columns, media commentary and public speaking focus on current socio-demographic trends and how these impact Australia. Follow Simon on Twitter, FacebookLinkedIn for daily data insights in short format.

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