Charity urges businesses to ‘radically rethink’ support for ageing workforce

Report calls on employers to end age bias in recruitment and improve provision of flexible working

Businesses need to radically rethink their approaches to supporting the next generation of workers as they grow older, to ensure they maintain a good quality of life and make the most of opportunities presented by longer working lives, according to a new charity report. 

The Centre for Ageing Better’s report, The State of Ageing in 2019, warned of substantial workplace inequalities which could affect people in their 50s and 60s.

The research found ill-health was a major reason why people left work prematurely and could affected quality of life and access to other services such as healthcare. 

It said nearly a third of people aged between 50 and 64, 3.5 million people in total, were not in work. This included 1 million people between 50 and 64, below the state pension age, who had stopped work prematurely, with poorer individuals more likely to leave work due to ill health.

The charity called on employers to support people to keep working in fulfilling jobs “as long as they want”, especially those managing health problems or caring responsibilities, enabling them to save more for their late life. 

It said employers must adopt “age-friendly practices” such as ending age bias in recruitment, improving provision of flexible working, continuing training and progression for workers of all ages and supporting carers and those with health conditions. 

Dr Anna Dixon, chief executive for the Centre for Ageing Better, said the report was a “wake-up call” for people in their 50s and 60s to act now to “add life” to their later years.

“Without radical action today to help people age well, we are storing up problems for the future and leaving millions at risk of poverty and poor health in later life,” Dixon said. 

The number of workers aged over 50 in the UK stands at 10.4 million, an increase of 2.4 million in the last decade, and the Office for National Statistics predicts the number of people aged 65 and over is set to grow by more than 40 per cent in the coming two decades, reaching more than 17 million by 2036

The Centre for Ageing Better also found poor health was forcing many people out of the labour market prematurely. More than a fifth (22 per cent) of men aged 55 to 64 reported they had a health problem that limited the work they could do, and a similar number of women (21 per cent) said ill health restricted their working options. 

Charles Cotton, senior reward and performance advisor at the CIPD, said it was vital HR professionals helped organisations review the design of work, job responsibilities and working hours to help people better manage their health conditions and stay in work for as long as they wish.

“Phased retirement is an option that our profession should explore as it allows experienced employees to share their skills and knowledge with colleagues while gradually decreasing their workload,” Cotton added.

He pointed out the report showed the “massive increase” in pension membership due to auto-enrolment, but cautioned HR should not rest on its laurels.

Cotton said HR departments should take an evidence-based approach when communicating with their workforces about financial wellbeing and its impact on later life. 

The report found there had been a steady increase in the proportion of employees who belonged to workplace pensions in the UK – 82 per cent of all full-time employees in 2017, compared to 55 per cent in 1997. It attributed this increase to the introduction of auto-enrolment in 2012. 

Steve Webb, director of policy at Royal London and former minister for pensions, told People Management employers should maintain open and clear communication about the value of workplace pension schemes to their ageing workforce. 

“With the death of final salary pensions in the private sector, many older workers will have smaller accrued pension rights than in the past, so it is vital that employers communicate the value of being a member of the workplace pension scheme and of contributing beyond the bare legal minimum,” Webb said.

He added employers should be clear about how much they are contributing to the pension and “that opting out is like turning down a pay rise”.   

In April 2018, minimum auto-enrolment contribution rates rose from 2 per cent to 5 per cent, with the proportion employers are obliged to contribute increasing from 1 per cent to 2 per cent. Next month, contribution rate will increase to 8 per cent, of which employers will be required to contribute a minimum of 3 per cent.