Demographic Change

Falling birth rates and rising life expectancy are a structural phenomenon confronting all highly industrialised countries. In the long term they lead to a fall in the overall population and a growing proportion of older people. According to forecasts from econsense, the number of over-80s in Germany, for example, is set to nearly triple to 10 million by the year 2050. At the same time, the number of people of working age, i.e. between 20 and 64, could fall by as much as 29 percent, depending on immigration levels. Mastering this demographic change is an important future task for responsible human resources managers in Germany.

Proportion of total population aged 65+ in selected regions of the globe (Forecast to 2050)

No company will escape the consequences of this far-reaching change, because the average age of the workforce is increasing, too. At the same time, as the number of university graduates declines it is becoming more difficult to find well-qualified younger staff. Especially in high-tech sectors like the automotive industry, companies are competing ever more fiercely to attract the best talents in the labour market. The situation is exacerbated by the fact that well-educated, committed employees will play an increasingly crucial role in maintaining competitiveness as corporate structures and processes become ever more complex.

Companies face three challenges:

• first, recruiting new talents, if possible while still at university, and retaining their loyalty; 
• second, modifying the age structure of the workforce through their recruitment policies; and 
• third, developing the capabilities of their employees in order to remain innovative and
• productive with an aging workforce.

Developing new resources
In order to overcome the lack of qualified specialist personnel, companies will increasingly need to look beyond their traditional recruitment measures and develop new strategies. In Germany, for example, people from migrant groups and women are much less successfully integrated in the labour market than in comparable countries.

As far back as the 1980s, the Volkswagen Group was one of the first companies to promote equality of men and women in the workplace. Nonetheless women are still not as well represented in our specialist and leadership positions as we would wish.

Holistic concepts
In future, the Volkswagen Group will be employing even more carefully targeted strategies to optimise the capabilities of its employees. Through systematic and structured human resource development initiatives, we will help our employees remain physically fit, motivated and competent over the long term and/or acquire new skills. The holistic concepts and strategies applied in this respect already have a long tradition within the Volkswagen Group. They are based on the realisation that the key factors in promoting individual well-being and maintaining motivation over the long term include:

• recognising and encouraging individual achievements,
• attractive career opportunities,
• performance-related compensation,
• appropriate continuing professional development and
• systematic healthcare management.

Flexible working hours are another important factor, adapted to employees’ individual needs and enabling them to achieve a good work-life balance. The Volkswagen Group leads the field in Germany in pioneering flexible and innovative working-time models and fair personnel policies. We will continue this policy in the future.

Ensuring knowledge transfer
In their knowledge and professional experience, long-standing employees possess a significant asset which can benefit their younger colleagues. In aging workforces, knowledge transfer between the generations plays a very important role, while helping to ensure that valuable skills are not lost when individual employees retire. A comprehensive system of integration and knowledge management is essential to ensure that older employees pass their knowledge on to the next generation.