LONDON, England (The Financial Times), June 16, 2008:By Norma Cohen, Economics Correspondent
The numbers of people employed past retirement age are growing faster than any other section of the labour market, according to official data. The figures signal a significant change in the way Britons work and perhaps an even more profound change in the way they retire.
By March 2008, 1.3m men and women beyond the ages of, respectively, 65 and 60, were in the workforce, a rise of 8.8 per cent year on year. This was a much sharper rise than that for any other age group. The second most marked rise is occurring among those aged between 50 and retirement age, the point where a decade ago employers offered generous early retirement packages in order to shed their more expensive workers.
The data tell an important story: as lifespans expand and retirement benefits shrink, growing numbers are entering, or refusing to leave, and workplaces are gradually changing their perception of the ideal worker. “Older people are the only growing group in the labour market,” said Stephen McNair, head of the National Institute of Adult Continuing Education, a think-tank on adult learning. “The positive message is that most people over the age of 50 would like to stay in the workforce longer than they thought they would be allowed.”
The data show among men aged 50 to 64 and women aged 50 to 59, there are 6.6m workers, more than there are at the prime working ages of 25 to 34. The year-on-year rate of increase in the number of these older workers is 2.1 per cent.
In part, the shift reflects an underlying demographic change as fertility rates among Britons have dropped sharply. But it also reflects rising longevity – a man born in 1950 who hits his 65th birthday will, on average, live to a few months shy of his 90th – and better health at older ages.
It demonstrates the fact that for some people, work is not the drudgery of the mill or the mine but rather a place to establish social networks and to participate in wider society.
“It’s both sides of the coin,” said Zina Ambrose, a spokeswoman for Age Concern. “There are those who can’t afford to stop working and there are those who want to keep on working because they feel they have a lot to offer.”
John Llewellen, senior economic policy advisor at Lehman Brothers, added that the rising workforce participation among older workers also marked a shift in Britain’s economy from a heavy manufacturing base to one highly dependent on service provision. “You’re not asking these guys to swing a pick-axe,” Mr Llewellen said. Decades ago, at least half the work force was in hard physical labour, he added.
Ros Altmann, a specialist in pensions economics, said that the shift highlights the fact that many people would like to retire more flexibly, perhaps continuing to work part time. “These are bonus years for many people,” she said.
Copyright The Financial Times Limited 2008
