New Age UK analysis finds that while employment rates for
older workers have increased in this country since the 2008
recession, as has been widely reported, the more hidden flip side
is that the number of hours worked on average by older workers
has declined since then. The same pattern has been observed in
other similar countries too.
In its report, the latest in its ‘Behind the headlines…’ series
- ‘Why the employment rate does not tell
the whole story about working longer’, Age UK
warns that if policymakers only look at the headline employment
rate for older workers they risk drawing too rosy a conclusion
about how easy it is for older people to stay in well paid,
secure work, whereas the reality for many is far less positive.
This is especially pertinent now, as within weeks the Government
will be formally responding to John Cridland CBE’s independent
report into State Pension Age that was published in March.
Using new analysis, Age UK’s report looks beyond the positive
headline employment figures for older workers, examining in more
detail how the number of hours typically worked has changed since
before the 2008 recession and aiming to uncover more about how
the labour market has really developed for older workers. The
Charity argues that whilst it is correct to say that the
employment rates for older workers have improved in recent years,
the pattern of hours worked is far more complex and less
reassuring than often portrayed.
In particular, Age UK’s research found that for men aged 50-64,
there has been a decline in average hours worked regardless of
their precise age or the skill level of their occupation.
This also suggests that public policies aimed at improving
employment outcomes for workers in their fifties have been
relatively unsuccessful and need to be reviewed.
There was also a decline over the same period in the average
hours worked by women aged 50-64 in higher-skilled
roles, although women in lower skilled roles have seen
an increase in their average hours worked.
A reduction in hours of working could of course be a positive
sign if it reflects the fact that older workers are choosing to
gradually scale down their hours, for example to help them juggle
other responsibilities, but Age UK’s research suggests it is more
likely to be driven by negative factors, including the rise of
insecure employment.
Age UK’s analysis finds that the 2008 recession is not the cause
of these trends because they were already clearly underway by
then.
The Charity points out that if older workers work fewer hours
they are likely to earn less and this is a concern because it
will make it harder for them to maintain their standard of living
until they reach their State Pension Age, and harder to keep on
putting money aside to help them enjoy a comfortable retirement
once they stop working.
Caroline Abrahams, Charity Director at Age UK,
said: “It is certainly true that the numbers of
older people in employment are rising but the fact that on
average they are working fewer hours is an important
qualification. Our research suggests this may be less through
choice and more a consequence of the changing labour market, with
issues such as the rise in self-employment and the so-called ‘gig
economy’ starting to have a real impact. It is well known that
many younger workers are finding themselves part of the
‘precariat’ – people whose work is highly insecure and
unpredictable, often against their wishes – and now we are seeing
evidence of the same thing happening to some older workers too.
“It goes without saying that if you work fewer hours you will
earn less, and for older workers who are compelled to do less
work than they would like it could make it a lot tougher to
withstand any rise in State Pension Age, let alone have any spare
income to save for their retirement.
“Within the next few weeks the Government will be responding to
John Cridland’s independent report into the State Pension Age, so
it is really important that Ministers look beyond the headline
rate of employment of older workers at what is actually going on
for millions of people in their fifties and sixties who are
struggling to get and keep the secure, well paid jobs they want
and need.”
“As John Cridland himself advised, the Government needs to do
more to enable those who can work longer to do so, for example,
by improving re-training opportunities, and by increasing the
practical and financial support on offer for carers and people
with severe health problems who are unable to get back to work.
“Looking ahead, we also think it is crucial that the State
Pension continues to retain its value to give people more
financial security so they can look forward to later life with
confidence, not fear. For example, research has shown that
abandoning the triple lock would significantly reduce the chance
that someone with low earnings can retire with an adequate
income.”
