Human Resources Strategy in a Time of Demographical Changes Jože Glazer, the President of Slovenian Association for Human Resource Management and Industrial Relations (ZDKDS)

Presentation From sociologist to the managing director’s assistant, Talum Kidričevo (1973–1993) Director-General, Employment Service of Slovenia (1993–2005) Secretary of the Faculty of Social Sciences (since 2007) President of the ZDKDS (2004–2008) Member of WAPES MB (2000–2004) Member of EAPM MB (2004–2006)

Content Human resource strategy as a response to changes and challenges Demographical changes Changes on the labour market Diversity of the working force –How to deal with the generation differences between the employees – the generational management –Employment of the foreigners Conclusion

Human Resources Strategy It derives from the company’s strategy and is anticipating the concepts, the development area, and benchmarks which will from the human resources management point of view contribute to the implementation of the company’s business strategy. It presents the answers on how to respond to the future challenges and changes with the help from the employees.

The changes Slovenia is going through big demographical changes and changes on the labour market The diversity of the manpower in our companies is increasing

The demographical changes in Slovenia increasing share of inhabitants older then 65 years, particularly above 80 years old, decreasing number of children increasing share of the dependant population expected lifetime of the inhabitants will gradually increase (for man from 74.7 years in 2008 to 83.7 years in 2060, and for women from 81.9 years in 2008 to 88.8 years in 2060).

The demographical changes in Slovenia due to diverse expected lifetime, the share of women among inhabitants will increase (now between age group from 70 to 79 years there are 65.2% of women). increasing of the inhabitants in the age when the retirement is expected (above 60 years 28.4 percentage points, the share of inhabitants aged till 14 years and from 15 to 60 years should reduce for 17.8 percentage points) immigration from abroad (6000 per year until 2020, gradual decrease on 2300 persons in 2060). the decrease of the total number of the inhabitants after 2019 from 2.06 million to 1.76 million in 2060

The changes on the labour market The number of the registered unemployed persons since 1993 when it reached the highest level ( unemployed persons and a 14.4% level of the registered unemployment) is constantly decreasing. In 2008, the level of the registered unemployment in 2008 decreased as far as on 6.5% (61,164 unemployed persons respectively)

The movement of the registered unemployment from 1990 to 2007 Source: Employment Service of Slovenia Gibanje registrirane brezposelnosti od 1990 do 2007

The structure of the unemployed the increasing of the share of older unemployed, above 50 years of age (in 2007, already 32.6% of all the unemployed persons). the increasing of the unemployed who have 7th and 8th level of education (in 2000, registered 2199 of the unemployed with the high level of education, 2.1 of all the registered respectively; in 2008, 5046, 5.5% of all the registered respectively). the employment difficulties in particular between the young job-seekers with the high education; the demand for this group between the employers is the smallest.

Needs for the workers 1997–2007 Recorded job vacancies in the period from 1997 to 2007 LETO Recorded JV 133,823154,911143,149139,037145,214169,199202,904227,934242,927 Definite time94,741109,589103,605103,398107,138124,634152,324171,734185,977 Percentage DT Source: Employment Service of Slovenia

The lack of the workers In the last years, the biggest demand was for the following: construction, processing industry, real estates, renting and business services. Demand for the new workers, particularly in the industries where the lower level of professional education is demanded.

The changes regarding the employees Different generations Different values Higher level of knowledge Stronger individualism Demands for the show and entertainment Financial capabilities

Generation management Dealing with the ageing manpower Managing of the generation differences between the employees Preserving of the experiences and knowledge Reducing the cost related to old age Responding to the changes on the labour market (changes of the legislation) Solving the problem of the lack of the manpower

Employment of the foreigners At the end of the June 2007, among the inhabitants of Slovenia there were 62,722 or 3.1 % foreigners with the registered residence in Slovenia, among them 85.3% citizens from the area of the former state. Among immigrated foreigners, there were 1339 citizens of the EU-25. Source: Statistical Office of the Republic of Slovenia, 2008

Employment of the foreigners in Slovenia, many economic activities could not be performed anymore without the employment of the foreigners (construction, season works in agriculture, hospitality industry…). many employers decide for the employment of the foreign workers: lower labour costs, stronger motivation of the foreign workers. among employed foreigners there is a majority of workers with the low professional education (up to the 4th level of education, 55.9% in 2006); low technological level of the companies which need new workers

Dilemmas and challenges regarding the employment of the foreigners The ways of communicating among the employees Diversity of cultural and personal values of the employees Qualifying of the heads for work with diversified groups regarding nationality Preparing domestic workers for the cooperation with co-workers – foreigners Organizing help to the foreign workers to get accustomed to new working midst, and to new living environment Selecting the methods of recruiting foreign workers Setting the system of covering the needs for key and other workers

The challenges as the basis for the human resource strategy Posts of the future Workers of the future –The amount of payment correlates with the loyality Managing the effectiveness of the organization –Less income –Less people –Bigger effects Forming the organizational culture and values favourable to the changes

The challenges as the basis for the human resource strategy Managing the effectiveness of the organization –Less income –Less people –Bigger effects Forming the organizational culture and values favourable to the changes

The challenges as the basis for the human resource strategy People possessing knowledge: Encourage development Motivate Hold Lead The fight for talents – the fight for production workers!

The challenges as the basis for the human resource strategy Family– work Social responsibility of the organization Social responsibility towards the employees –Preparation for the unemployment –Qualifications for the most insecure groups of the employees –Assistance in the search of the new employment opportunities

The challenges as the basis for the human resource strategy Successful companies have elaborated strategies of assuring the necessary personnel and adequate personnel sources; the employment of foreigners is for some of them becoming more and more important source. The companies are forming the systems of retaining of all, not just the key personnel with adjusting the working positions to different age groups.

Conclusion The companies that knew how to adequately prepare to the challenges and changes in the environment, are more competitive on the market. Due to demographic changes and due to harder and harder assuring of the necessary manpower, the adjustment of working positions to the elderly co-workers and development of the systems of retaining not only the key personnel, but also workers in the key processes.

Conclusion The successful organizations form their responses to the changes and the new challenges as a constituent part of their middle and long-term development strategies.