The Australian Government issued their fourth Intergenerational Report on 5th March 2015. Each report provides projections adopting a ‘point-in-time’ format – that is, using the assumption that current government policies will continue unchanged over the next 40 years. No time to read the full report? We’ve summarised the key findings, and what they mean for you.
The 2015 Intergenerational Report presents an overview in terms of what could happen to Australia during this period. The report is broken up into a number of sections which consider different aspects of Australia’s outlook, including population, labour force, economy, budget and environment.
With consideration to how Australia will change over the next 40 years, the report focuses on:
Report outcomes and family business implications Population
This refers to the proportion of people aged 15 years and over who are actively engaged in the workforce. The economy will benefit from opportunities to support older Australians who want to work, as well as boosting opportunities for women, young people, parents and people with disabilities to participate in the workforce.
The expected changes in participation rates are:
Does the current family policy on employing family members require reconsideration, given the expected changes in employment mix?
Will the family need to rethink who will be leading the family business in the future? What qualities will they need? Will they need to rethink the selection criteria?
In the 1970s, the internet, mobile phones and social media did not exist as we know them today. Now they are integral parts of our lives and IT related industries employ nearly as many people in Australia as the mining industry. Technological advances such as innovative robotics, 3D printing and self-navigating vehicles have the potential to unlock quality of life improvements. During the 1990s, Australia’s productivity was an average of 2.2% growth per year. More recently, productivity growth has slowed to 1.5%.
The family business should have a digital technology plan to ensure the business itself is adaptive to the rapidly-changing, technology-oriented environment. In order to do so, it is essential to consider the following factors:
Being part of a family business can be both rewarding and challenging. It can be challenging because of the ways in which business ownership, management and family relationships overlap.
The Intergenerational Report encourages the family business to employ a long term growth strategy and focus on structured planning, taking into consideration both internal and external factors that may influence its future. Now is the time to revisit what the family plan looks like and if any necessary changes are required to ensure it is able to navigate through the complexities of population, participation and productivity factors of the future economic landscape. It is noted that a family which has regular family meetings and reviews its values and policies should also look to revisit and revise their Family Constitutions.