1. Why is career guidance for mid-career adults important?

Abstract

This chapter first looks at trends in the labour market and the demand and supply of skills in Australia. It assesses the degree to which mid-career adults participate in training or change jobs – both possible responses to changing demand for skills. Finally, it reviews survey evidence on the use and inclusiveness of career guidance by mid-career adults in Australia.

In Brief

Mid-career adults in Australia face particular challenges in the current labour market context

The COVID-19 crisis has put pressure on the Australian labour market and amplified existing challenges, especially for some groups most affected by job losses. This has created challenges for mid-career adults who could benefit from career guidance and training opportunities. The key findings of this chapter are outlined as follows:

Australian adults face a challenging labour market situation after the pandemic. Demand for skills has changed and there is evidence of increasing skills shortages in Australia, more than half of which are concentrated in medium-skilled occupations. The negative employment impacts were most prominent for low-qualified, part-time workers and women, who lost low-skilled jobs and can only take up emerging occupations following retraining.
Automation and plans to reach zero-carbon emissions by 2050 (hereafter referred to as the green transition) are shifting skills demands in Australia. The COVID-19 pandemic led to an acceleration in the adoption of new technologies. Many of the new jobs created by the green transition will be in medium-skilled occupations, but these may not be located in the same areas where jobs are disappearing.
Mid-career workers change jobs less often than younger workers. That said, mid-career workers in occupations with high risk of automation change jobs more often than mid-career workers in lower-risk occupations.
Participation in job-related training is also lower for mid-career adults than for younger adults. Mid-career adults are more likely to participate in training to progress in their current employment – either by improving skills in their current job or maintaining professional status and/or meeting occupation requirements – than with the objective of preparing for a job they might do in the future.
The share of adults who have spoken to a career guidance advisor is high in Australia compared to other countries covered by the OECD Survey of Career Guidance for Adults (51% vs. 40%) and is particularly high for mid-career adults (56%). An important caveat is that a large share of survey respondents report receiving career support from publicly funded employment services (whether federally funded or state funded), and most of these services focus on job matching rather than career guidance.
Adults in part-time employment, low-educated adults, women, adults living in rural areas, and foreign-born adults are less likely to use career guidance than their counterparts, and these gaps are particularly large in Australia. For instance, 74% of high-educated mid-career adults use career guidance compared to only 44% of low-educated mid-career adults, the largest gap among participating countries.

Introduction

Career guidance supports adults in navigating career and training opportunities, and is of crucial importance in the current context of rapidly changing skills needs and job transitions arising from the pandemic. This report explores what constitutes high quality career guidance for mid-career adults, as distinct from younger adults and those nearing retirement. Mid-career individuals – adults who have been in the labour market for at least 10 years and have at least 10 years before retirement – could benefit from the support of a career professional in navigating the changing labour market and identifying suitable retraining and upskilling opportunities to remain productive and satisfied at work. This is a group heavily affected by the changes in the labour market: their skills are more likely to become obsolete because they are further away than youth from initial education; yet they still have a significant portion of their work life ahead of them, making significant reskilling both possible and rewarding.

This chapter first examines labour market trends and the effects of the pandemic, and how these are having an impact on the demand and supply of skills. The chapter considers the degree to which mid-career adults are adapting to changes in skill demands by retraining or changing jobs. It concludes that career guidance for mid-career adults could better support them in facilitating employment transitions and finding suitable training opportunities, given the pace of ongoing labour market changes.

The analysis in this report is based on a combination of desk research, video calls with stakeholders in Australia and new evidence from the OECD Survey of Career Guidance for Adults (SCGA). The virtual interviews were conducted with stakeholders at federal and state levels, as well as with private actors and researchers involved in career guidance for adults in Australia. The SCGA is an online survey that sheds light on the use, provision, inclusiveness, and quality of adult career guidance services across countries. In doing so, it fills an important information gap by creating an internationally comparable source of data on the use of adult career guidance services. Already implemented in 10 other countries (Argentina, Brazil, Canada, Chile, France, Germany, Italy, Mexico, New Zealand, and the United States), this survey was conducted in Australia in July and August 2021.

Box 1.1. What is career guidance for adults?

Consistent with the definition used in the OECD Survey of Career Guidance for Adults, this report defines career guidance for adults as “a set of services (public or private) intended to assist adults to make educational, training and occupational choices.”

Career guidance for adults can be distinguished from career guidance for young people in schools in various ways. First, adults generally acquire skills through work experiences that are not formally validated. Effective career guidance for adults supports them in identifying employment and training opportunities that leverage these existing skills. Second, career guidance for adults is ideally sensitive to their more complex needs, including family, childcare and financial responsibilities. Third, having been out of school for longer periods, adults are generally less aware of training opportunities and more familiar with the labour market than young people. Effective career guidance considers these factors.

Career guidance differs from job matching services. Job matching is typically reserved for unemployed people where the goal is to place jobseekers into employment. Though career guidance can help jobseekers to find jobs, it ideally takes a more holistic approach where skills, knowledge and abilities are thoroughly assessed, and the individual’s constraints and motivations are taken into account when designing career development plans. Also, the metric for success differs for job matching and career guidance. In general, job matching is considered a success if a jobseeker secures employment. Career guidance is considered a success, by contrast, if an individual obtains any number of milestones towards greater employability and personal well-being: acquiring new skills to manage their career, feeling more positively about their labour market prospects, identifying and/or enrolling in a relevant training opportunity, or acquiring sustainable employment in an occupation they enjoy. For the most part, federally funded employment service providers (jobactive) in Australia do not provide career guidance but rather job matching services. However, career guidance is provided through some state-funded employment service providers.

Career guidance for adults has the potential to strengthen skill development, facilitate labour market transitions and support a better match between the supply and demand of skills and labour. Adults have varying levels of knowledge about labour markets and training opportunities, as well as varying abilities to plan their futures. Career guidance has the potential to level these inequalities and support the labour market inclusion of under-represented groups.

This report will use the general term “career guidance advisor” to refer to professionals who provide career guidance. In Australia, advisors working in career guidance can be called “professional career development practitioners” if they have completed a post-graduate career development qualification and/or registered through the Career Industry Council of Australia (CICA).

Source: OECD (2004[1]) Career Guidance and Public Policy: Bridging The Gap, https://dx.doi.org/10.1787/9789264105669-en; OECD (2021[2]), Career Guidance for Adults in a Changing World of Work, https://doi.org/10.1787/9a94bfad-en.

1.1. A changing labour market context

The COVID-19 pandemic, along with pre-existing trends such as digitalisation, globalisation, population ageing and plans to reach zero-carbon emissions by 2050 (“the green transition”), are changing the Australian labour market. This section discusses these changes and how they affect the demand for skills in the labour market. This is of particular relevance for Australians in their mid-career, given that the skills they acquired in initial education may have become obsolete, and they may require reskilling to remain employable in the changing labour market.

1.1.1. The Australian labour market is making a strong recovery from the pandemic

By Q3 2021, Australia had made a strong recovery from the COVID-19 pandemic, with the unemployment rate below pre-pandemic levels and the employment-to-population ratio above pre-pandemic levels. The initial effect of the pandemic on unemployment was sharp, peaking at 7.4% in July 2020 (Figure 1.1). The increase in unemployment could have been much higher if there had not been a drop in labour force participation and introduction of subsidies for businesses significantly affected by COVID-19 (National Skills Commission, 2021[3]). The easing of restrictions led to an improvement in the labour market, and by February 2022 the unemployment rate had fallen back to 4.3%, even below pre-pandemic levels. The employment-to-population ratio in February 2022 was at 77.2%, 2.7 percentage points higher than the pre-pandemic level (74.5% in March 2020). Mid-career adults, like other age groups, experienced an increase in unemployment during the first year of the pandemic, but unemployment has since recovered and now sits below pre-pandemic levels (Figure 1.2).

Australia’s labour market is now tighter than it was prior to COVID-19. Tightness can be seen by a sharp rise in the vacancy-to-unemployment ratio in Australia, as well as in other English-speaking countries (Canada, United Kingdom and the United States) (Romain A Duval et al., 2022[4]). The rise in labour market tightness may be partly due to a change in worker preferences, particularly away from some low-pay jobs. Sectoral job mismatch may also play a role.

Figure 1.1. Employment and unemployment rates have returned to pre-pandemic levels in Australia

Figure 1.2. Average unemployment rate, by age group

Some socio-economic groups were hit harder than others in the early stages of the pandemic. Part-time employment decreased more than full-time employment, reflecting wide use of part-time and temporary contracts in the exposed industries. Women were disproportionally affected by the pandemic due to a combination of reasons. Women are overrepresented in service industries that were forced to shut down, they are more likely to be in part-time employment and thus among the first to be considered for retrenchments, and during school lockdown women took on more caring roles in the household, leading to a reduction in working hours. OECD analysis of online vacancy data also shows that there was a larger drop in vacancies and new hires among low-skilled adults versus higher-skilled adults in Australia during the pandemic (OECD, 2021[7]), as well as a substantially lower employment growth for low-wage workers compared to high-wage workers (OECD, 2021[8]).

Since the initial stages of the pandemic, full-time employment has recovered faster than part-time employment. Full-time employment in February 2022 is 4.0% above the level recorded in February 2020, while part-time employment is 0.3% below the February 2020 level. Women have experienced a significant improvement in the labour market since the latest wave of the pandemic, with unemployment hitting close to a record lows of 4.0% in December 2021, inching up to 4.3% in February 2022, and the employment-to-population rate hitting a record high of 73.9% in February 2022.

1.1.2. Automation and the green transition are shaping the demand for skills in Australia

Automation, globalisation, population ageing, and the green transition are influencing the demand for skills in all OECD countries, including Australia. This section will focus on the impacts of automation and the shift to a green economy on the Australian labour market, before moving to a discussion about how Australians in mid-career are adapting to such changes.

The COVID-19 pandemic has accelerated pre-existing trends towards automation, as firm adoption of new technology has increased in response to the pandemic. Australian adults face a lower risk of losing their jobs to automation than on average across the OECD (Figure 1.3). According to OECD estimates prior to the pandemic, 11% of jobs in Australia are at high risk of automation while an additional 25% are at significant risk of change as many tasks could be automated. As jobs become more automated, higher-level skills like digital skills become more in demand.

Some occupations face a higher risk of automation. The risk is particularly prevalent in low-skilled occupations in agriculture and mining in rural areas, as well as in construction. In urban areas, jobs at risk are concentrated in administrative jobs where tasks can be automated or altered using technology. Men face a higher risk than women as they are over-represented in occupations related to trades, manufacturing and mining. Youth and Indigenous workers face a particularly high risk as they tend to be employed in occupations entailing more routine and repetitive tasks than the rest of the population (OECD, 2021[9]). Indigenous Australians often work in jobs which face the highest risk of being automated over the long term (OECD, 2019[10]), as well as in geographic locations that make it challenging to find alternative employment. Job creation in Australia is dominated by the creation of lower-risk jobs. However, some regions have experienced a decrease in the share of jobs that have a low risk of automation, thus increasing the share of jobs with high risk of automation (OECD, 2021[9]). Continued emphasis on digital skills will be particularly important to meet the growth of low-risk jobs.

Figure 1.3. Jobs at risk of automation or significant change

The green transition is becoming more pressing as the effects of climate change become more evident, particularly after the 2019-20 Australian bushfire season which caused significant social, financial and ecological losses. The government has recently announced plans of delivering net zero emissions by 2050 (The Australian Government, 2021[12]). The green transition will be accompanied by significant employment opportunities, and estimates show job creation is likely to be concentrated in medium-skilled occupations (ILO, 2019[13]). Already, Australia faces its highest skill shortages in medium-skilled occupations (Figure 1.4). New jobs will be created as part of the green transition, but might not be located in the same industries in which jobs are lost. At the same time, current training systems are not sufficiently aligned with the shifts that are taking place (ILO, 2018[14]). A strong and agile education and training system that is responsive to industry will be necessary to facilitate job transition from declining industries into new, green jobs. Career guidance and training will be crucial to support those who do not have easily transferrable skills.

According to the OECD Skills for Jobs database, which currently refers to 2016 for Australia, Australia displays substantial shortages in medium-skilled occupations and high-skilled occupations. Nearly half of shortages are in high-skilled occupations in Australia (49%), compared with the OECD average of 55%. (Figure 1.4). There are comparatively more shortages in medium-skilled occupations in Australia (51% versus 39% across OECD countries). This presents an opportunity to facilitate transitions of low-skilled workers into medium-skilled occupations. Still, it requires a strong system for identifying people in low-skilled occupations and mapping their training needs to transition into medium-skilled occupations. Career guidance can be a key policy lever in this effort.

Figure 1.4. Australia displays substantial shortages in medium- and high-skilled occupations

1.2. Mid-career adults are an important target group for training and guidance

In the current context of changing demand for skills, mid-career adults are an important target group for training and guidance. This section discusses the characteristics of mid-career adults, why they can benefit from career guidance, and what type of training and guidance can be most beneficial for them.

1.2.1. Characterising mid-career adults

While there is no commonly accepted age range that corresponds to mid-career adults, adults in this group have generally participated in the labour market long enough to have acquired skills through both education and work experience, but are still relatively far away from retirement. This report defines mid-career adults as individuals with at least 10 years of labour market experience and who have at least 10 years before retirement. Any data analysis in the report that refers to the mid-career adult population will approximate this group by focusing on the sample of adults aged 40-54 (regardless of their years of labour market experience and years to retirement).

Focusing on mid-career adults supports the policy goal of encouraging Australians to be lifelong learners. As mid-career adults have participated in the workforce for a substantial period of time, they have acquired skills and experience. At the same time, the skills they acquired in initial education may have become obsolete or may no longer be relevant for the work they are doing. With many years left before retirement, mid-career adults still have a significant portion of their work life ahead of them. They may thus need help to build on their existing skills to progress, but they have time to enjoy a return on their training investment before they retire.

1.2.2. Mid-career adults have particular training and guidance needs

Data from the 2012 OECD Survey of Adult Skills (Programme for the International Assessment of Adult Competencies – PIAAC) show that mid-career adults participate less in job-related training than younger adults (Figure 1.5). According to the survey, 56% of mid-career adults participated in formal or non-formal job-related training over a 12-month period compared to 62% of younger adults. Generally, mid-career adults train less than young adults, partly because the opportunity cost of training is higher due to their income being higher. Mid-career adults are more often in full-time employment, and inflexibility in the work schedule can lead to less training. Other factors that result in less training among mid-career adults are less awareness of both the existence of training programmes and their benefits given that for most of them a long time has passed since they were in initial education, and more family responsibilities which limit the time they have available to train.

Figure 1.5. Participation in formal or non-formal job-related training, adults aged 25-64, 2012/2015

National data shows that there has been a small decrease in job-related training among mid-career adults in Australia (OECD, 2019[15]). The Household, Income and Labour Dynamics in Australia (HILDA) survey indicates a slight decline in job-related training for mid-career adults between 2007 and 2017, with 27% of mid-career adults participating in training in 2017 compared to 29% in 2007 (Figure 1.6). Further, the number of days attending a training course has declined for mid-career adults (from 7.9 days in 2007 to 6.3 days in 2017). However, over the same time period there was an increase in number of training courses attended (from 3.7 to 4.2 courses). This indicates that mid-career adults are attending more courses but of shorter duration, either because the courses are more efficient, less substantive, or so that they fit in better with family and work responsibilities.

Mid-career adults’ motives for training are focused on improving current employment rather than preparing for a potential change in occupation. According to the HILDA survey, the most common motivation for training is to improve conditions in one’s current employment, either by improving skills in one’s current job (15%) or maintaining professional status and/or meeting occupation requirements (13%). Only 5% of respondents trained to prepare for a job they might do in the future. Other reasons cited for training were to develop skills generally (12%), health and safety concerns (6%) or to help get started in the job (2%).

Figure 1.6. Participation in job-related training in the past 12 months, 2007-17

1.2.3. Mid-career adults change occupations more often than older adults, but less than younger adults

The rate at which adults change occupation declines with age. In Australia, 19% of mid-career adults changed occupation between 2016 and 2017 (Figure 1.7). This is lower than the rate for younger adults (23%), but higher than the rate for older adults (12%). Figure 1.7 shows a slight decline in job transition rates for all age groups since 2001/02, when 23% of mid-career adults changed occupation. As one might expect, mid-career adults in occupations with a high risk of automation change occupation more often than those in lower-risk occupations (Figure 1.8). They may switch jobs more often either because their role becomes obsolete or due to less stable working conditions in high-risk jobs that result in transitions from one high-risk job to another. At the same time, adults in high-risk jobs also train less than those in low-risk jobs (Figure 1.8). This is concerning, as people in high-risk occupations should ideally be training more to enable their transition to more stable employment.

Figure 1.7. Annual occupation transition rate, 2001-17

Figure 1.8. Rates of occupation changes and training in Australia, by occupation and risk of automation

1.3. Use of career guidance by mid-career adults

Career guidance plays a vital role in enabling adults to participate in training. It assists individuals in assessing their training needs and in making well-informed educational, training and occupational choices (Box 1.1). Across OECD countries, policy on career guidance has tended to focus on young people in schools, who are about to transition either into higher levels of education or into the labour market. There is growing attention, however, given to adult skills and training and how career guidance can support adults in adapting to changing demand for skills. As noted above, adults in mid-career are particularly well-placed to benefit from career guidance services. This section reviews the use of career guidance by mid-career adults in Australia, based on the OECD Survey of Career Guidance for Adults (SCGA).

Box 1.2. OECD Survey of Career Guidance for Adults

This report uses data collected in the OECD 2020/2021 Survey of Career Guidance for Adults (SCGA). The SCGA was conducted to better understand adults’ experience with career guidance services and to improve international data on its use, coverage and inclusiveness. It currently covers 11 countries: Argentina, Australia, Brazil, Canada, Chile, France, Germany, Italy, Mexico, New Zealand and the United States.

Data collection for Australia was conducted between end-July and mid-August 2021. The survey was disseminated online to a panel of individuals aged 25-64. A stratified sample methodology imposed quotas to have a representative sample of the country’s population in terms of age, gender and region.1 The final Australian sample size after quality checks was 2 999 observations, of which 1 110 were mid-career adults (age 40-54). Education weights are applied using OECD data (2020[16]) to facilitate cross-country comparison. For a full description of the methodology, see OECD (2022[17]; 2021[2]).

The online survey was conducted in different countries over 2020 and 2021, at different stages of the COVID-19 pandemic. Cross-country differences in the reported use of career services may therefore partially reflect measures to address the employment effects of the pandemic.

Source: OECD (2022[17]), Career Guidance for Adults in Canada, https://doi.org/10.1787/0e596882-en; OECD (2021[2]), Career Guidance for Adults in a Changing World of Work, https://dx.doi.org/10.1787/9a94bfad-en; OECD, (2020[16]), Education at a Glance 2020: OECD Indicators, https://dx.doi.org/10.1787/69096873-en.

1.3.1. Career guidance programmes and portals reach a large share of the population in Australia

There is a high use of career guidance among adults in Australia, with 51% of adults aged 25-64 reporting that they spoke to a career guidance advisor in the previous five years (compared with 40% among countries in the SCGA) (Figure 1.9). The rate is even higher for mid-career adults, with 56% reporting having used career guidance (compared with only 38% of mid-career adults among countries in the SCGA). However, a couple of caveats are worth noting.

First, many respondents will have received job matching services rather than career guidance. As elaborated in Chapter 2, a large share of adults (24%) and mid-career adults (24%) report receiving career guidance from publicly funded employment services 2 (whether federally funded or state-funded) in Australia. There is no federally funded employment service that offers career guidance in Australia, though some state-level and state-funded employment services do offer career guidance (e.g. Victoria). Job matching is a part of Australia’s federally funded programme for jobseekers receiving welfare payments, and the service is carried out by private job service providers (jobactive networks). It is therefore likely that respondents who report having received career guidance from a federally funded employment services in Australia actually received job matching services.

Second, the share of adults who have used career guidance reflects not only those who have received career guidance through traditional modes (i.e. face-to-face delivery with a career guidance advisor), but also those who interacted with a career guidance advisor by phone, through online chat, video conferencing, and through instant messaging. As the Australian survey was conducted later in the COVID-19 pandemic relative to other countries in the survey, the high use may partially reflect a greater use of online career guidance as well as greater availability of public programs to respond to the employment effects of the pandemic.

Figure 1.9. Use of career guidance services among adults

The intensity of service, i.e. the number of interactions that an adult has with a career guidance advisor every year, is another important indicator of how well career guidance services are used. It provides insights on whether there is a follow-up after a first consultation, and if there is a continuity in the service delivery. Most mid-career adults who use career guidance services in Australia have multiple interactions with advisors. Less than a quarter of mid-career adults who spoke with a career guidance advisor over the past year had a single interaction (23%), while 40% had two interactions, and 37% spoke with a career guidance advisor three or more times (compared with 24%, 38%, and 38% across the average for other countries in the survey, respectively) (Figure 1.10). Repeated interactions with career guidance advisors may indicate an execution of a more long-term guidance plan and follow-up. Jobseekers receiving support through jobactive also typically have obligations to attend ongoing appointments.

Figure 1.10. Intensity of use of career guidance services among mid-career adults

In addition to speaking to a career guidance advisor, many adults in Australia use more informal types of career support. Family members or friends can be a source of informal advice and career guidance, though such advice is not a substitute for professional career guidance. The SCGA suggests that 29% of mid-career adults in Australia rely on their networks for career advice, compared to 25% in the survey average.

Mid-career adults are more likely to participate in informal career development activities than either younger or older adults. Participating in career development activities allows mid-career adults to gain better understanding of employment and training opportunities available to them, giving them an opportunity to think more concretely about their skills, ambitions, and career preferences. More than half of mid-career adults (62%) participated in one or more career development activities in the 12 months preceding the survey, reasonably more than the survey average of 51% (Figure 1.11). The most common activities were visiting a training provider (27%), speaking with one’s manager or HR professionals at work (23%), participating in a job rotation/work site visit (17%) or visiting a job fair (15%). Only 5% of mid-career adults did an internship, apprenticeship or traineeship. Such activities are slightly more common among younger adults (8%).

Figure 1.11. Participation in career development activities

1.3.2. Use of career guidance among mid-career adults in Australia is unequal

Compared with other countries in the survey, use of career guidance among adults is more unequal in Australia. Figure 1.12 shows the gaps in use of career guidance in Australia by different groups, and these gaps are relatively large in international comparison.

Figure 1.12. Use of career guidance service, by socio-economic and demographic characteristics

Focusing on mid-career adults, these gaps are even more pronounced (Figure 1.13). Adults in part-time employment use career guidance much less than those in full-time employment (45 percentage points). Low-educated adults use career guidance less than high-educated adults, and this gap is much higher than the survey average (30 percentage points vs. 14 percentage points) and is the highest among all participating countries. Other important gaps exist between men and women (29 percentage points), adults living in rural areas and those living in urban areas (27 percentage points), and native-born and foreign-born adults (21 percentage points). Higher usage among mid-career men than mid-career women could be a reflection of their different personal and professional responsibilities. Mid-career adults have more family obligations that take time away from seeking out career guidance, and such family obligations are unequally distributed between men and women.

By contrast, other potentially disadvantaged groups take up guidance more than their counterparts do, such as workers in small and medium-sized enterprises (SMEs) (15 percentage points) and those who speak a language other than English at home (30 percentage points). The latter finding could reflect that Australia’s labour market integration programmes for skilled migrants contain career support or that non-English speaking adults are more likely to be unemployed and to receive assistance from employment services.

Higher inequality in the use of career guidance in Australia is worrying because it means that career guidance is not reaching those who most need it. Socio-economic inequalities become increasingly challenging to address the longer they persist. Reaching out to under-represented groups to connect them with career guidance services could improve training participation rates and labour market outcomes for these groups.

Figure 1.13. Use of career guidance service by mid-career adults, by socio-economic and demographic characteristics

References

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Notes

← 1. The age and gender quotas were based on UN World Population Prospects statistics, while the regional quotas were based on Cint’s data.

← 2. The delivery of publicly funded employment services in Australia are contracted out to private and non-profit providers.

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