Research suggests a growing skills shortage due to the baby boom generation retiring and falling immigration at a time of rising debt.
Analysts from Pantheon Macroeconomics have warned that economic growth could stall in the 2020s due to Britain’s ageing population and lower rates of immigration, leading business analysts have warned.
The forecast from Pantheon Macroeconomics suggests that the growth rate in the UK’s workforce will halve as an immigration clampdown sees fewer overseas workers, with labour supply also facing a hit as the Baby Boom generation enters retirement.
The report predicts that workforce growth will fall to an average annual rate of 0.3% over the next five years, down from 0.8% in the second half of the 2010s.
Pantheon economist Samuel Tombs said: “The days of strong workforce growth are long gone,” adding that expansion in the 2010s had masked underlying weaknesses in the economy, such as “deficient business investment and sluggish growth in productivity.”
Economists have warned that the working age population is set to shrink in the 2030s and may fall by the end of the 2020s.
Meanwhile, Aviva is reported to have discarded its target of recruiting 1,000 over 50s employees by next year in favour of a broader focus on diversity.
Danny Harmer, Aviva’s Chief People Officer, says: “Creating a diverse, inclusive organisation is fundamentally important to Aviva and critical to our future success. As the UK’s leading insurer, we want our people to reflect the diversity of the customers and communities we serve. For example, we have hired almost 600 permanent employees aged 50 or over since 2017 and 22% of our UK workforce is aged 50 or over.”