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.
People Management 6 Apr 2021 By Patrick Thomson