With the labour market in flux, our recent collaboration with the Institute for Fiscal Studies (IFS) on changing work patterns for people in their later years couldnt be more topical.
Jobs and the people who do them are changing. Those approaching retirement are more likely to be working in stressful and demanding jobs, which can have a detrimental impact on their ability to stay in a job – one in every four people over the age of 60 say they couldnt do their job.
While this may result in beneficial adjustments on a personal level, such as transferring to a profession or industry you enjoy more or lowering your hours, other people may be compelled to leave the employment prematurely, which can have a devastating effect on retirement financial stability. Evidence suggests that those over the age of 50 are twice as likely to be unemployed for an extended period of time, which means relying on savings and not contributing to pensions in the years leading up to retirement.
Getting away from the cliff edge of retirement
Were also approaching retirement in a different way than our parents and grandparents. In 2011, I contributed (in a modest way) to the removal of the default retirement age by compiling research on the effects on businesses and individuals. Employers could no longer retire workers at 65 without a solid reason, and people didnt have to request to work longer when the statutory retirement age was removed.
After ten years, we can see that considerably fewer people are retiring on the cliffs edge. According to an IFS analysis of the Labour Force Survey, there were two distinct retirement peaks in the mid-2000s, at 60 and 65. Between 2004 and 2007, about 10% of working 59-year-olds and over 30% of working 64-year-olds retired after a year. From 2012 to 2019, the peak at 59/60 had almost vanished, replaced by a more steady rise up to 63. While there is still a notable increase in retirements at 64/65, it has decreased to less than 25%. This should be a beneficial thing for many folks because it allows you to better balance the transition. For many people, this is a good thing because it allows you to better balance the transition.
Wed like to be more adaptable.
While we work longer on average, this does not automatically imply that we work harder. People in their mid-40s are more likely to desire to work fewer hours, not more, according to IFS data. Unfortunately, most occupations are not created with flexibility in mind. But, as our Timewise pilots, toolkits, and guides demonstrate, they could be.
Because of the type of job they perform, the types of businesses they work for, or something as simple as having a health issue, many people miss out on the benefits of flexibility. According to our findings, over 50s with a health problem are 4 percent more likely than those without a health problem to seek fewer hours. They are, however, the folks who are least inclined to shift occupations.
The government has pledged in its platform to move closer to a system in which flexible working is the default, which has recently been in the news as businesses plan for how (or if) staff will return to work. With the furlough coming to an end and job market churn on the rise, we may expect a lot more upheaval in the near future.