Dave Simmonds: Growth will come from those who do not have a job now

Director of Inclusion, an independent, not-for-profit organisation dedicated to promoting social justice, social inclusion and tackling disadvantage

We have more people in work than ever before and this means big challenges for employers in recruiting new staff. The Government is setting itself an even bigger task - it wants to see 80 per cent of people in a job. At the moment, three out of four people (75 per cent) are in work. The gap might not seem large but there are important reasons why this gap is one of the most important challenges for the UK's labour market.

Reaching 80 per cent means around 2.8 million people have to find and keep work. Achieving this is one of the central planks for pensions reform - more people have to be in work to support larger numbers of elderly and fewer young people.

On current form, it will take another 12 years to get to 80 per cent if the upward trend of employment since 1993 is continued. The Government has recently reinforced its intention by announcing a range of welfare reforms. The main idea is to change incapacity benefit so that more people are encouraged to move back into work. The Government's target is to reduce the 2.7 million people claiming the benefit by one million by 2016. Helping one million people with various degrees of disability is a tough target for any government.

What does all this mean for the diversity agenda? Put simply, the growth in the workforce over the coming decade will come from those who want work but do not have a job now. A quick look at who is not working now reveals that there are high numbers of disabled people, of black and minority ethnic people, or people over 50, and other groups that the labour market has tended to pass over in the past. This is set to change.

Change is the only sensible course of action. This is because the employment rates for some types of people are well over 80 per cent already, and in some instances, over 90 per cent. If you are a well-qualified white male with no disability then full employment is a reality. And there's the problem - if employers simply compete for the "job rich" this will fuel inflation and lead to greater inequality.

This is why any government will also need to close the employment gaps between different groups in society. This means that two things have to happen. First, employers have to change their recruitment practices to attract a more diverse workforce. Second, those wanting work will need help in improving their employability and developing their skills. The diversity challenge to employers has been moving increasingly centre stage. New equalities legislation has meant that employers have to look at their practices across the board. Also, as the make-up of UK consumers moves towards becoming older and more ethnically diverse, the canny business (especially in the service sector) recruits a workforce that connects with the consumer.

All employers and all governments are going to have to do more on recruiting diversity over the coming years if, as a nation, we want to minimise the social and economic inequalities caused by worklessness but critically still have enough people in a job to support our ageing population.

Inclusion, working with Talent recruitment, is hosting a national diversity event in London on March 8-9 to highlight the importance of diversity in the workplace. For more information visit www.cesi.org.uk or call 020-7840 8338.