New Business opportunities in a changing world
Evolutions in technology are most often cited as the main driver for changes in the mobility industry. Nevertheless, factors such as ageing societies, multi-generational workforces and remote labor are also, indirectly, shaping how we will move from point A to point B.
Global population and Age
By 2025, the global population will have grown to 8.08 billion people. 3.85 billion people will be working or looking for a job, 1.1% or 390 million people more than today. The spread of the age of the working population however, is changing rapidly: whereas, in 2015, 66.2% of the working population was younger than 44 years, by 2025 only 63.3% of the working population will be younger than 44 years. In other words, people will stay professionally active much longer than today.
The global rise of the median age (29.6 years in 2015 to 32.2 by 2025), in combination with a decreasing birth rate and a slow-down of migration, will also have an effect on the retirement age. A natural evolution would be for the retirement age to evolve with the median age, but in fast ageing countries, such as Japan, the real retirement age (69.1 years) is already exceeding the government’s anticipated retirement age (65 years) by more than 4 years. It is a reality that the baby-boomers will be working beyond the anticipated (Government’s) retirement age.
For reference, amongst the hyper-ageing countries, Japan leads the ranking (by 2025, 30% of the population will be older than 65 years), closely followed by Germany, Italy, France and UK.
Millennials, who are between 17 and 36 years old today, will make up approximately half of the workforce by 2025 and will be working alongside Gen X’ers and baby-boomers. The result is a complex workforce combination of people with a completely different value set, outlook and expectations. Employers today are already seeing the impact on recruitment and retention, e.g. baby-boomers will associate work with worth and prioritize salary, whereas millennials prioritize experience and lifestyle.
The share of high-skill jobs in developing countries is rising (e.g. India, by 2025, up to 20% compared to 5% in 2000), but the percentage of employed workers in medium skilled jobs is decreasing universally, a phenomenon called the “skill mismatch”. In other words, routine labor will face most challenges.
Automation and robotics, often perceived as a “threat”, will be necessary, especially in developed countries, to cope with the lack of medium to low skill jobs. Similarly, a smart (global) migration policy could re-establish the balance between offer and demand.
Millennials appreciate the possibility to work from anywhere in the world. Places such as Chiang Mai in Thailand, Ubud in Bali, Hanoi in Vietnam have good internet connections and offer lifestyle options that are cheap and exciting. Even if this trend is still marginal today, remote work will become much more mainstream in the near future.
The industry has understood the potential of remote micro-tasking, breaking down complex projects into easy tasks that can be fulfilled by remote and unskilled workers. Also freelance brokering is becoming more popular: connecting knowledge and people across the world with one-off contract projects.
Eventually, remote working will also impact the need for mobility. If a job can be done quicker and cheaper by a well educated person in Thailand, there will be no more need to look for a local employee.
Impact on mobility
All of the above will have implications for mobility:
- As flexible work and workspace will become mainstream, personal mileage is expected to decrease
- Cars will become mobile workspaces
- Afterwork retail shopping is on decline in favour of warehouse-to-door models
- Importance of cybersecurity and in-car privacy will increase
- Increase of senior users will require a specialised fleet
- Demand for leisure vehicles will increase
This demonstrates that evolutions in technology, such as 5G, Cloud and Blockchain are indeed essential triggers for new mobility solutions, but are even more necessary to cope with generational challenges and new behaviors. New business opportunities arise for the visionary!
The data and research used in this article are provided by Frost & Sullivan’s Shivaji Das during Connector’s M15 Mobility forum in Manila.