How aging and urbanisation is impacting the facility service industry

Demographic megatrends, aging and urbanization, are creating new challenges for the Facility and Service Management. In this blog post, we look into which ones you, in particular, should pay attention to.  

Aging and urbanization

Can you imagine a workplace where your grandparents, parents, and children were also employed? Assuming you are not already part of a large family business, then according to Forbes, “this mixed, multi-generational environment is a new diversity challenge for HR organizations everywhere”. Attracting, recruiting and retaining the best possible workforce will become increasingly complex as the interests and motivating factors for workers from various generations are different. In Europe, the US, Japan, and China, the four-generation (soon to be five) will become increasingly common in the years to come. It will be essential for all FM and services industry companies to understand the motivational factors for each age cohort.

Today, 55% of the world’s population lives in urban areas, a proportion that is expected to increase to 68% by 2050, according to UN projections. Those projections show that urbanization, the gradual shift in residence of the human population from rural to urban areas, combined with the overall growth of the world’s population could add another 2.5 billion people to urban areas by 2050, with close to 90% of this increase taking place in Asia and Africa, according to a new United Nations.

McKinsey Global Institute expects that the 600 largest cities will be responsible for 60% of global GDP by 2025. Within the global 600, the vast majority of cities will have populations under 10m, and over two-thirds will be in low- and middle-income countries. 



Consequences of aging for the FM and services industry


    • The competition for talent will increase over the coming decade. The talent competition, combined with other factors (increasing focus on sustainability, brand values and individualization), will change how companies attract employees.
    • A company’s approach towards sustainability and social responsibility will impact their ability to attract certain employee profiles. Prospective employees will scrutinize how an employer’s brand, image, and values reflect their own.  
    • Companies should devote attention to how to attract, recruit, retain and motivate workers from different generations and backgrounds. The four-generation workplace will become increasingly common in the US, Europe, China, and Japan.
    • Training programmes will have to be tailored to help workers with differing degrees of educational and technological sophistication keep up with the pace of technological development.
    • Difficulty in recruiting the right talents will foster technological development, outsourcing and innovation to find alternative solutions to solve the talent shortage problem.


Consequences of urbanization for the FM and services industry



  • Urbanization will place enormous strains on local environments and global commodity resources. The FM and services industry will develop more complex building systems to cope with the challenge.
  • Buildings will be increasingly seen as part of more complex systems that cover geographic entities (district heating and cooling solutions, for example) as well as organizational realities (value chains).
  • FM and services industry strategies will have to be adaptable to the needs of the local environment. Sustainability challenges will vary from region to region, and the building’s role in the local infrastructure and supply chain will have to be taken into account. In some regions, energy use will be most important, while in others, water usage or disaster preparedness will have the greatest priority.
  • A number of new systems will become increasingly common. Such systems include computer-aided facility management; building automated systems; computer-maintenance management systems; integrated workplace management systems; and infrastructure lifecycle management systems.

Want to learn more about how Megatrends will impact the Facility and Service Management industry in the future? Download the ISS 2020 Vision White Book: The Future of Service Management now!