Unlock Economic Opportunities through Strategic Workforce Planning under an Aging Population Scenario.

Among the challenges posed by the aging population, strategic workforce planning becomes paramount for adequate preparation.

Extensive data analysis and reports from reputable sources such as World Health Organisation (WHO)’s “Aging and Health” and the United States Census Bureau revealed a significant demographic shift with a substantial increase in the aging population in the US. By 2040, approximately 80.8 million Americans will be aged 65 or older, up from 34.7 million in 2000. 1  

The relationship between the aging population and the healthcare sector workforce is complex. On the one hand, the aging population places a greater demand on healthcare services, creating potential challenges in meeting the increasing needs. On the other hand, the adequacy of the healthcare workforce significantly affects the well-being and productivity of the aging population.

Pearson Labour Market Insight (LMI) explores strategic workforce planning in the Health Care and Social Assistance Industry with advanced forecasting modeling, comprehensive skills, and task analysis, and thorough examination of technology impact and adoption. This proactive approach will unlock career opportunities and enhances the well-being of the elderly within the context of an aging population scenario. 

The Business-as-usual scenario: Projecting Health Care and Social Assistance Industry workforce demand

To understand the future demand for healthcare workers in the context of an aging population, we propose a ‘base case scenario or business-as-usual scenario where no significant changes are made to address this demographic shift.  

In the US, there are currently 133,382,500 employed individuals2. Over the next ten years, job demand is projected to increase to 138,014,500. Within the Health Care and Social Assistance Industry, this will increase workforce demand from 20,283,600 to 22,096,000 in 10 years.  

The Aging population scenario: what happens if the Health Care and Social Assistance Industry experiences a sudden workforce surge?

5 Under the scenario where aging population challenges are not adequately addressed through optimized workforce planning, a ripple effect can occur across various industries. One notable consequence is the surge in healthcare demand and shortage of skilled workers. This increase in healthcare services could represent an extra 2 million workers needed in the next decade, compared to the business-as-usual scenario, reaching 24,863,000 employees. It’s important to note that there “aren’t enough new graduates (today) to fill nursing roles,” which would exacerbate this situation.

Inefficient healthcare workforce planning can lead to an overburdened healthcare service, which harms the health and well-being of the overall population and the economy. This ripple effect could mean 1,198,000 fewer jobs overall in the economy for the other industries. In our scenario, this is driven by slower economic growth than the base case because of a loss in productivity of an aged workforce whose health needs are not met. 

The Optimal Scenario: Unlocking opportunities for older adults through Strategic Workforce Planning in the healthcare sector 

Strategic workforce planning paves the way for boundless opportunities across all sectors. Healthcare services demand will increase, but thanks to a strategically well-planned healthcare workforce, it can contribute to the overall strength and stability of the labor market.  

Supported by strategic workforce planning, the total workforce demand could reach 141,569,000 by 2033, an additional 3,554,000 more jobs in the economy compared to the business-as-usual scenario.
 
These initiatives could result in the creation of approximately 25,177,000 jobs for the Health Care and Social Assistance Industry. Among these jobs, Registered Nurses will experience a significant increase with 571,000 headcount growth over the next ten years. These roles encompass a range of geographical features and skills required to address the mismatch of demand and supply. 

Strategic workforce planning: Focusing where it’s needed the most 

It is crucial to consider geographical aspects. States like Texas and California, with relatively robust healthcare industries, will experience less impact from the aging population than states such as Wyoming and West Virginia. The latter will require 12,000 Registered Nurses each to meet the rising demand in the next ten years. Proactive measures, such as retraining programs and nursing worker migration, can bridge the gap and ensure the provision of quality healthcare services. 

In terms of skills, effective planning starts with identifying and developing key skills essential for healthcare jobs. One such crucial skill is Elderly Care, which is vital in jobs such as Nursing Assistants and Home Health Aides.

However, more than identifying skills and jobs in demand is required. Factors like technology and societal needs mean that jobs and skills are constantly evolving, so monitoring these changes becomes essential to ensure that a life-long-learning mindset is met with job market demands. For example, the Medical and Health Services Manager role has numerous emerging skills, including employee engagement. Emerging skills are those that either existed but are now becoming more important or are new and becoming more important for that role. The employee engagement skill can become crucial to this role as engaging with aged customers becomes more important.  
 
As technology advances, anticipating its impact and utilizing it for healthcare jobs become essential for strategic workforce planning8. Some tasks for Registered Nurses, such as maintaining health records, may be automated by ‘process automation,’ whereas assistive robotics can augment tasks like supervising personal activities. Leveraging technology effectively can help redistribute tasks and direct workers to where the activities that generate the largest value, like caring for patients, and this, in turn, can help address workforce shortages.

When implementing technologies, how automation affects gender and diversity should also be considered. For example, in the next 10 years, 4.5% of male nurses would be impacted, compared to 14.7% of female nurses. Strategic workforce planning ensures expertise in implementing and managing such technologies, enabling organizations to acquire the right talent and plan for upskilling and retraining.  

What should we do next? 

Health sector preparation. 

To ensure the optimal scenario unfolds, strategic workforce planning should include location-based workforce distribution, targeted skill development, task-specific job transitions, and effective adoption of healthcare technologies. This approach can balance the skillful healthcare workers specialized in senior care, chronic disease management, and other critical areas while addressing the demand for nutritionists, healthy lifestyle professionals, and scientific workers to promote preventive measures alongside curative treatments for the elderly.

Organizational Readiness. 

Organizations must play a proactive role in building a supportive work environment by implementing age-friendly workplaces, providing flexible work arrangements, and offering ongoing learning and development opportunities.

"Workers of all ages are looking for active learning opportunities… Providing upskilling and reskilling opportunities to your workforce signals to them that your company is invested in them and cares about their success."9

-Credly by Pearson

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1 United States Census Bureau, population projections, https://www.census.gov/programs-surveys/popproj.html

2 Workforce Skills Labour Market Data calculations, excluding farm establishments and the majority of the agricultural sector (with a few exceptions), self- employed, owners and partners in unincorporated firms, federal government (except for the postal service and the federal executive branch).

3 All future employment numbers are Pearson’s Workforce Skills scenario forecasts, from the Labour Market Insights product.

4 We assume business-as-usual economic growth of 2.6% per annum over ten years with a moderate technology adoption rate in the base case.

5 The growth rate in this scenario drops to 2.5% per annum over ten years without strategic workforce planning in the context of an ageing population. Technology is still adopted at a moderate rate.

6 Assuming optimised healthcare strategic workforce planning, the projected annual economic growth over a ten-year period is 2.8% with a moderate technology adoption rate.

7 Pearson Workforce Skills Analytics, powered by Faethm. 8 Pearson Workforce Skills analysis on technology impact on jobs, powered by Faethm.

8 Pearson Workforce Skills analysis on technology impact on jobs, powered by Faethm.

9 Credly Blog, “7 ways to incorporate active learning as you upskill your workforce”, https://learn.credly.com/blog/seven-strategies-to-incorporate-active-learning-as-you-upskill-your-workforce