The number of older workers in employment had been steadily growing over the last two decades, with four million more workers aged 50 and over than there were in 2000. However, the economic impact of the coronavirus pandemic and the subsequent disruption to the labour market has particularly affected older workers.
The latest figures show there are 175,000 more people aged 50-64 out of work since March 2020 and more than 640,000 over-55s still on furlough. This is a real concern as data shows that those who fall out of the workforce at this age are twice as likely to become long-term unemployed. Without intervention we risk triggering an unemployment crisis among older workers that will force many into poverty during retirement.
While more of us might need to work for longer, the truth is that more than half (59 per cent) of men, and more than two-thirds (68 per cent) of women, have left work by the age of 65. Health is a key reason for this, as confirmed by recent report from the TUC last week, which revealed that more than half a million people aged 60 to 65 leave the workplace for health reasons.
The TUC is calling for an ”immediate and ambitious programme” to help older workers who lose their jobs to get back into employment and early access to state pensions for those unable to get back into the workforce. Long term, the TUC is calling for measures that “extend working lives without further widening inequalities”, including better access to training and the right to work flexibly, and reforms to the social security system. It also wants a new cross-party commission to review the state pension age in light of widening health inequalities and reducing disability-free life expectancy, which will see more of us living with multiple health conditions in our 50s, 60s and 70s.
An early exit from the labour market can have a serious detrimental impact on financial stability both immediately and in the future, with people unable to continue making pensions contributions, dipping into savings and even drawing down pensions early. It also impacts on the wider economy with reduced tax contributions.
How can we support people to work for longer?
It might sound obvious but, for people to do a job, the job has to be doable. With our longer lives this needs to be doable not just over a 40-hour a week, but for 40 weeks a year and for 40 years. One in four people in the UK don’t think they could do their job or one like it beyond the age of 60.
In the Centre for Ageing Better’s recent report, The State of Ageing, half of workers aged 50-69 say their job is excessively demanding, and around one in three say they have a lack of control at work. Low-control and high-demand roles are damaging in the short term and unsustainable over a working life.
Many people say flexible working is the number one workplace practice that would support them to work for longer. The Centre for Ageing Better has produced a toolkit with experts and employers to shape how to make this work in practice, and supports the CIPD’s call to make the right to request flexible working a day one right.
We must make work better
Social attitudes data shows that over recent decades more people are realising that they need to work for longer, and often that is through necessity rather than choice. The state pension age reached 66 for the first time in 2020 and will rise to 67 in the years to come. Having a choice over how and when you work over the age of 60 is a key indicator of wellbeing and quality of life, even when accounting for social background and previous health.
For many people, alongside the financial necessity are other benefits that good work can bring. Fulfilling work can have many benefits for people’s financial wellbeing and their social connections, meaning and purpose. Offering mid-life support to plan for the future is one way employers can help people to frame their longer working lives and the government is looking to promote concepts like the mid-life MOT.
Good work is key to people wanting to work for longer. McKinsey research shows that 25 per cent of an employee’s overall life satisfaction is determined by their job satisfaction. The most important factors in job satisfaction are having an interesting job and having good interpersonal relationships. And good relationships with management account for 86 per cent of whether or not we are satisfied with our relationships at work. Employee satisfaction is essential for businesses too, being positively correlated with customer satisfaction, lower staff turnover, profitability and productivity.
So work matters, and in particularly the actions of employers, leadership and line managers. They have the opportunity to make jobs better and they certainly run the risk of making jobs worse.
Employers need to value the benefits of age diversity
Our Good Recruitment for Older Workers project has shown that employers rarely think about age when looking to improve the diversity and inclusion of their workforce, and it also demonstrates the importance of age in recruitment. Older workers are more than twice as likely as younger workers to say the recruitment process disadvantages them.
Employers are key to making this change – in recognising the productivity benefits of multigenerational teams, supporting health and flexible working, improving line management and leadership. This means overcoming age stereotypes and biases in the workplace and supporting age-friendly workplaces. This will benefit younger and older workers alike, and crucially benefit the productivity of employers themselves.
Patrick Thomson is senior programme manager for fulfilling work at the Centre for Ageing Better