Local government experts are predicting a serious shortfall in skilled staff within ten years as Gen Y’s shun local councils and Baby Boomers clinging on until retirement start to fall off their perches.
A four-year benchmarking survey led by Local Government Professional Australia, NSW involving 135 NSW, Western Australian and New Zealand councils, found that while council workforces are ageing they are finding it hard to attract and retain younger people, especially Gen Y’s.
Councils analysed their own performance on a range of indicators, including service provision, finance and operations, risk management, assets and leadership but it was the makeup of local council workforces that set alarm bells ringing.
Gen Y’s are woefully underrepresented in councils and they are also much more likely to quit within a year when they do get local government jobs. The situation is most acute in NSW.
CEO of LG Professionals, NSW Annalisa Haskell predicted a staffing crisis within a decade if the generation gap was not addressed.
“You’re looking at a major, major issue. We won’t be able to do the work in the future,” Ms Haskell said.
“Due to a uniquely old age profile quite at odds with the Australian working population, NSW local government is failing to significantly attract and retain new staff, especially Gen Y, who are twice as likely to leave a council than other generations,” she said.
She said the battle over forced council mergers in NSW had also sapped the sector’s energy and pulled the focus away from what was arguably a much more serious issue: staffing.
“We are having the wrong conversation. We need to move from the structure debate of mergers to understanding why local government is not positioned as a vibrant place to work compared to other Australian sectors, nor the place to invest in a career.”
In NSW councils, Gen Y’s represent about 40 per cent of the Australian working population in 2016 but they only make up 22 per cent of NSW council workforces. In WA it is 26 per cent and in New Zealand Gen Y’s make up 28 per cent of the council workforce.
While Baby Boomers are sticking around for decades and hoarding their leave, particularly in NSW, Gen Y’s that do start working for councils often don’t stay long.
In NSW, 19 per cent of Gen Y left within a year, compared with a 9.9 per cent turnover of all staff. It was higher in WA, where one in five Gen Y’s quit within a year, but the all staff turnover was also higher, at 13.8 per cent so the gap was less.
Meanwhile, Baby Boomers represent 35 per cent of the Australian working age population in 2016 but 44 per cent of NSW council staff.
In contrast, New Zealand does not have a problem with staff turnover, attracts more Gen Y’s and does a much better job at attracting women to local government, particularly at supervisory level or above.
Women represent 57 per cent of new starters in New Zealand, compared with 50 per cent in WA and 43 per cent in NSW.
Why is Gen Y turning away from councils?
Ms Haskell says that local government in NSW has a serious image problem and Gen Y’s viewed it as staid, slow and technologically backward. Council jobs also seemed to lack economic prestige.
“The sector isn’t appealing to Gen Y. They like the experience to be good,” Ms Haskell said. “Councils are by nature conservative and regulation bound and [generally] not very high tech. They are driven by compliance and the regulatory point of view.”
She said Gen Y were likely to ask why things were not instant and people not engaged. They were digital natives too.
“The problems we have are here now and will take time to fix – it is most apparent that we need to better promote local government as a compelling career sector,” she said.
The falling numbers of Gen Y girls taking subjects such as maths and sciences had also been felt in certain areas of council work, such as engineering and environmental jobs, which were often quite specialised.
Baby Boomers entrenched in their jobs meant there was an older leadership, sometimes at odds with Gen Y’s, and no obvious stepping stones for younger people.
“There is a generational split. The leadership is old and it’s not moving. Gen Y’s are likely to ask: ‘where is my career path and is this really me?’ ”
Mergers may also have been partly responsible for Baby Boomers staying in their jobs and accruing leave – a real liability for councils – because of the uncertainty of job losses generated by amalgamations. In contrast, New Zealand’s councils had little leave on the balance sheet.
No Plan B
Worrying, Ms Haskell said that the majority of councils had no succession planning in place. Rather than training Gen X and Gen Y to step up when senior staff retired, corporate memory walked out the door when Boomers left.
Only 13 per cent of NSW councils had proper succession planning in place in 2016, a drop from 20 per cent the previous year.
“With the Baby Boomers it’s all in their head and they’ve been the [council’s] anchor point. They haven’t got a succession plan ready. I’m surprised,” she said.
GMs sometimes had to quit suddenly because of serious health issues or accidents and external managers were parachuted into the role temporarily, rather than moving somebody into the role in-house.
Many councils did not have a deputy general manager, for example.
Ms Haskell said: “[We’re] dependent as a sector because of the nature of politics: ‘no-one else can do it except the GM’. That’s a real gap and we have to take responsibility.”
What can be done?
Ms Haskell said that encouraging Gen Y’s to network online and to share their ideas and experiences and to lead on certain issues would help.
Councils also needed to change the way they worked, connected and communicated. For example, making customer experience central and working back and supporting staff to deliver on this.
“Some councils are trying to get there but they’re in the minority. Gen Y’s have to drive it themselves,” she said.
Councils could check in with Gen Y recruits at the three-month stage and ask them about their experiences and perceptions anonymously and exit interviews were useful to find out what had gone wrong and how it could be fixed.
She said the sector needed to work together to motive people and share solutions but the threat of council mergers had hampered this spirit over the last three years and pulled councils apart, with many going into lockdown and survival mode.
Succession planning had to be faced up to and people mentored and trained to take over.
So what is New Zealand doing right?
Ms Haskell said the Kiwis were bringing in new people from non-government sectors and attracting management skills externally.
“[There are] more women in senior positions all the way up than in Australia.”
“In NSW, we appear to attract less [outside] talent to the sector and less from managerial roles that can make a difference culturally.”
New Zealand had also mounted a successful advertising campaign to attract young people to the sector.
The Australasian LG Performance Excellence Program survey, conducted in partnership with PwC, also involved nine merged NSW councils – previously 22 individual councils – and should help give merged councils a picture of their performance before and after mergers.
PwC Partner Stuart Shinfield praised the participating councils and said CEOs and General Managers ‘have had to lay themselves bare’.
“The heroes in this are the managers of the vast number of councils involved,” Mr Shinfield said. “No-one told them they had to drill-down like this – they took the front foot and said ‘Let’s do this’, whereas in the commercial sector this high-level of analytical review usually only happens when someone has been given a directive.”