August 8 2006 - Over one million 50-65 year olds currently
unemployed or economically inactive in the UK want a job, according to a new report by
the TUC. A major hurdle is employers' reluctance to recruit or retain older workers by
investing in training or making adjustments for disabilities.
Employers and government must defuse the 'demographic time bomb' of a rapidly ageing
workforce being pushed out of jobs and on to benefits and early pensions, says the TUC.
The report, 'Ready willing and able', questions the concept of luxury early retirement
for the 'baby boom' generation. Over one-third of 2.6 million aged 50-65 want a job,
with 250 000 actively looking. The average retirement age is 63, but 88 per cent of
non-working 50-65 year olds do not fit the stereotype of 'early retired, affluent
professionals'. Only one-third retire early 'fully voluntarily'. Many survive on state
support or inadequate occupational pensions until they reach state pension age
(65 for men, 60 for women but rising to 65 between 2010-2020).
Over the next ten years the number of people under 50 will fall by 2 per cent, while
the number aged 50-69 will rise by 17 per cent, increasing the 'dependency ratio' of
pensioners to working people. This would be offset until 2050, and an increase in state
pension age avoided, if 80 per cent of working age people were in employment. The
alternative is higher taxes, delayed retirement and poverty in old age. Government plans
to tackle the problem by raising the state pension age will serve only to make more people
dependent on benefits. Employers must stop discriminating against older workers and adopt
'age management' strategies, warns the TUC.
TUC deputy general secretary Frances O'Grady, said:
"Most baby boomers are not retiring early to cruise around the world or go bungee jumping. They have been dumped out of work and on to the
scrapheap and are scraping by on benefits or small work pensions.
"By refusing to retain and recruit older staff, who want to work,
employers are accelerating the demographic timebomb the economy is resting on. Companies need to ditch tired stereotypes of fifty and
sixty-somethings and develop 'age management' policies which capitalize on the value of
experienced staff by offering retraining and flexible working, and making minor changes
for people with disabilities."
The TUC is calling on employers to establish age profiles of their workforce and negotiate 'age management' policies with trade unions and employees. These should include training needs and flexible working to enable older workers to 'downshift' towards retirement. Government should extend these legal rights to over-50s. Employers should consider requests for reasonable adjustments to conditions for older workers, many of whom may have existing rights under the Disability Discrimination Act.
Maintaining the ability to work depends on health and fitness over the whole lifecycle. Government health promotion policies should reflect this. Employers should introduce training in good ergonomic practice and new technology, and workplace exercise programmes, argues the TUC.
Other key findings from the report include:
- The TUC estimates that the target of 80 per cent employment will require one million extra workers by 2015, two million by 2024 and three million by 2042.
- The UK has a higher employment rate for older workers than most EU countries, with 1.5 million more older people in work than in 1997.
- It has the second highest proportion of inactive 50-65 year olds who want to work, double the EU average.
- Employment falls from 88 per cent for men aged 35-49 to 72 per cent for men aged 50-65. Comparative figures for women are 76 per cent to 68 per cent.
- Economic inactivity rates double between age 55 and 60 for men (from 17 per cent to 35 per cent) and women (from 31 per cent to 60 per cent).
- A quarter of economically inactive 50-65 year olds who want a job, have less than five years to state pension age.
- Poor health is the commonest reason people aged between 50 and state pension age leave a job; 45 per cent have suffered a health problem for at least a year.
- Older people in the UK are much more likely to be economically inactive due to a disability than in other EU or OECD countries, this is especially true for over 60s.
- The TUC highlights one study showing that 40 per cent of men and 20 per cent of women retired earlier than they expected. Employers instigated two-thirds of these early retirements.
- Age discrimination seems more prevalent than any other type with those over 55 being almost twice as likely to suffer this form of discrimination.