AI must work for an ageing workforce, not against it

Employment and Workplace Relations Minister Amanda Rishworth’s recent announcement of a new AI Employment and Workplaces Forum is a welcome step.

But its success will depend on whether it recognises older workers not as a cohort to manage, but as a skilled, under-utilised source of productivity in an ageing workforce.

Australia’s population is ageing, yet many policy and business assumptions about work remain anchored to outdated definitions of “working age”. Official measures often stop at 64, despite strong evidence that workforce participation increasingly extends well beyond that point.

This has direct consequences for productivity and economic resilience, particularly in a labour market marked by persistent shortages.

AI will reshape work across almost every sector. But the productivity gains it promises will depend less on headline adoption rates and more on who is equipped to use these systems effectively.

Decisions made now about training, skills development, job design and inclusion will shape whether AI expands participation or quietly narrows it.

Productivity, demographics and the missing middle
What is largely absent from current productivity narratives is sustained attention to the interaction between technology, demographic change, and workforce inclusion.

Productivity benefits are too often treated as automatic outcomes of innovation, with insufficient focus on how work is organised, how skills are developed, and which workers are expected to remain active contributors.

Forecasts from Jobs and Skills Australia indicate that AI impacts will not be evenly distributed. Older workers face heightened risks of exclusion and displacement when new technologies are introduced without deliberate workforce strategies.

International analysis reinforces this warning: in ageing economies, productivity growth increasingly depends on retaining experienced workers through sustained participation, skills investment, and job redesign. Premature exits from the labour market impose costs that technology alone cannot offset.

Australian evidence on skills and age

Australian data points to a structural gap in skills development. Joint research by the Australian Human Rights Commission and the Australian HR Institute shows that many hiring managers perceive older workers as less able to adapt to change.

These views are not driven by lower motivation or capacity, but by reduced access to training, lower employer investment and assumptions about diminishing returns later in working life. As working lives lengthen, these assumptions are increasingly misaligned with economic reality.

Against this backdrop, AI becomes a test of workforce strategy. Where skills investment builds capability across the whole workforce, technology can support participation and performance. Where it does not, AI narrows opportunity, limits lifelong learning and risks eroding productivity.

Leadership choices at a critical moment

Australia is at a critical juncture. The decision not to proceed with an AI Act or mandatory safeguards has shifted greater responsibility to business leaders, industry bodies and those shaping AI deployment in workplaces. That shift makes leadership choices more consequential, not less.

AI is often described as a neutral tool. In practice, it reflects the choices made by those who design, procure and deploy it.

Used responsibly, AI can support an age-diverse workforce by automating repetitive work, reducing physical strain and enabling people to focus on judgment-based tasks where experience matters most. Used without care, it can reinforce inequalities and embed them into systems that are harder to challenge.

Few organisations currently assess how AI affects different groups of workers. In an ageing labour market, these choices will strongly influence whether experienced employees remain productive contributors or are gradually displaced.

Early signs of strain are already visible in sectors such as transport, where ageing workforces, labour shortages and rapid technological change converge. International evidence shows that AI skills strategies are most effective when deliberately age-diverse, with mixed-age teams outperforming homogenous ones.

Without conscious intervention, AI-driven skills models risk formalising age bias at scale under the banner of efficiency.

AI can lift productivity if older workers are included
AI has the potential to lift productivity by augmenting human capability rather than replacing it. Realising that potential depends on who is supported to use the technology.

OECD analysis shows that workers who receive training are far more likely to benefit from AI adoption, while those excluded from skills development face marginalisation. Older workers are disproportionately affected by this dynamic.

This places AI upskilling for older workers at the centre of the productivity agenda. Experience, judgment and institutional knowledge retain significant economic value, particularly in roles involving complex decision-making and human interaction. Even modest increases in participation among workers aged 50 and over can deliver productivity gains exceeding annual growth rates.

A rights-based lens on participation and performance
This issue is also fundamentally about human rights. Principles of equality, non-discrimination and participation are central to Australia’s human rights framework and align directly with sustainable productivity objectives.

Older people have the same rights as others to work, upskill and participate fully in economic life. Excluding them from skills development or AI-enabled roles reduces participation, increases insecurity and undermines wellbeing. These outcomes are not inevitable consequences of ageing; they are the result of choices about policy, investment and workplace culture.

An age-diverse workforce should not be seen as a concession to fairness at the expense of efficiency. It is a recognition that inclusion and productivity reinforce one another.

A productivity agenda fit for Australia’s future

As leaders gather to discuss productivity, one principle deserves far greater emphasis: participation drives productivity. That means investing in AI capability across working lives, embedding lifelong learning into workforce strategy and rejecting the false trade-off between economic growth and human rights.

Australia has an opportunity to build a workforce that is productive, resilient and inclusive — one that values experience, applies new technology responsibly and does not waste talent. Whether we seize that opportunity depends on whether we choose to make AI work for people, rather than against them.