In the year that the state pension age has reached 66, the coronavirus pandemic risks halting – or even reversing – decades of improvement in the employment rates of older workers. Over the last 20 years, the employment rate of people aged 50 to 64 rose from 60 per cent to more than 70 per cent. In March this year, one in three women, and 41 per cent of men, were still in work at 65.
Now, as we face job losses to rival the early 1980s, new analysis shows that the number of unemployed over-50s in the UK has increased by a third in the past year. There is a real risk of these workers being overlooked in the months ahead and, without action, many could fall into long-term unemployment.
We are still yet to see the full force of this recession make its way into the high-level employment statistics. At the initial height of the job retention scheme, 2.7 million over-50s were furloughed. Research by the Centre for Ageing Better carried out with the Learning and Work Institute estimated that 377,000 of them would lose their job when the scheme ends.
Furlough rates formed a U-shape, with the youngest and oldest workers hardest hit – particularly the over-55s. In September, the Resolution Foundation found that furloughed workers in the oldest age group range – 55 to 64 – were the least likely to have fully returned to work. And since March, the number of people aged 50-plus claiming unemployment-related benefits has doubled.
Being made redundant is a real blow at any age, and our ability to bounce back depends on a number of factors. But we know that those in above 50 struggle more than any other age group to get back into work. In 2019, only one in three people aged 50-plus returned to work after losing their job, compared to half of 35 to 49-year-olds, and two-thirds of 25 to 34-year-olds. Figures also show that almost one in three older workers were out of work for more than 12 months, and are twice as likely to be in long-term unemployment than younger adults.
This is partly because, in the past, job-seekers support simply hasn’t been sufficient. In 2019, just one in five over-50s who were referred to the government’s work programme came out with a job – the worst outcome of any group. Older workers were found less likely to receive the same level or intensity of support as their younger counterparts; to experience continuity of support from job advisers; to have frequent meetings; and to view the support they received as helpful.
Ageism in the jobs market is a real issue and one of the main barriers older workers face. A quarter of over-50s said they have been put off applying for jobs because it seemed as if they were aimed at younger candidates, and a third believe they have been turned down for a job because of their age. A lack of flexible working opportunities is also a barrier for those who are carers for parents or loved one. Similarly, too few employers offer the kind of flexibility and support that workers managing health conditions need to stay in work. It isn’t just over-50s who suffer as a result of these barriers, but employers are also missing out on the skills and experience of these workers.
A high unemployment rate for this group has a significant impact on the economy. If we let hundreds of thousands of over-50s fall into long-term unemployment now, many will be forced to rely on benefits for many years before they are able to claim their state pension. Official figures from 2018 show that halving the employment gap between people aged 50 and the state pension age and those in their 40s could see income tax and national insurance receipts rise by 1 per cent (just under £3bn) and GDP up to 1 per cent (£18bn).
It's crucial than that in the months to come, the over-50s facing unemployment aren’t simply left to fend for themselves. Last week, chancellor Rishi Sunak announced £2.9bn to ‘restart’ the careers of people who have fallen out of work with intensive support. This support is badly needed. But we also need to see early intervention with support tailored for the over-50s.
Above all, the government must give a consistent and clear message to employers, job coaches and employment support services that the over-50s are as entitled to support as younger workers. Simply allowing a generation of older workers to fall out of work early would be devastating – but it can be prevented with the right support.
Emily Andrews is senior evidence manager at Centre for Ageing Better