Age-old assumptions about when working life should end are rapidly changing. Increasing numbers are choosing to work beyond State Pension Age (SPA) and many are having to work longer than planned to assure their income in retirement, particularly in light of recent changes to SPA. As a society we have failed to grasp and respond, not only to the needs of an ageing workforce but also, and perhaps most critically, to its vibrant potential. We need to rethink the employment needs of older people to help ensure that individuals have increased choice about when to stop work. But we also need to make full use of the potential of older workers if the economy is not to be choked by a shortage of labour.
Of the 11.6 million people in the UK aged 50-64 there are 3.3 million who are ‘economically inactive’ (not seeking work) while another 347,000 are unemployed. Some of those out of work will have chosen to retire or stay at home while others will have been forced out through some combination of factors. It is this last group of individuals that this report is devoted to.
This report firstly explores the extent to which older workers have been forced out of their jobs through factors outside of their control. We conservatively estimate that almost 1 million people aged 50-64 have been made ‘involuntarily jobless’ – pushed out of their previous job through a combination of redundancy, ill health or early retirement. Those aged 55-59 are particularly exposed to involuntary exit of this kind, with 57% of all exits amongst this age group the result of factors pushing them out of work.
We also explore why such a high proportion of people aged 50-64 leave the workforce completely. When we investigate the reasons that people are not looking for work amongst this age group, a similar pattern emerges with long-term sickness, looking after family members and early retirement explaining the majority of inactivity amongst the pre-State Pension Age group. Looking specifically at those in their 50s, long term sickness dominates, with half of all inactivity put down to poor health amongst those aged 50-54 and nearly 40% amongst those aged 55-59.