Return of the over-50s – pressing pause on retirement to boost the economy

The Chancellor, Jeremy Hunt, has announced the 2023 budget. Alongside his commitments to continue energy bill support, increase the defence budget and extend free childcare hours to children aged 9 months and above, another of the topics on his agenda was getting the over-50s back into work to help lift the economy out of stagnation. Many have dubbed it the ‘back to work’ budget.

 There is no denying it, the economy has been stalling.  The UK is the only G7 economy that is still smaller than it was before the pandemic, even after growing 4% last year, and one part of that is due to labour shortages.

A calculated 3.6million of those aged 50 to 64 are deemed ‘economically inactive’, meaning they are neither in work nor looking for it. A hefty percentage of that figure are people who are comfortable enough to retire. However, for around 500,000 of them, being out of work isn’t for the want of trying. There are several factors keeping this demographic at home.

Providing flexibility is key

For starters, some organisations don’t offer the flexibility that many people within this age bracket are looking for. One in five over-50s are informal caregivers and they want a job that will fit around their priorities, but many feel that the vacancies on the market fall short. Plus, with the state that the social and childcare systems are in, many job seekers are having to weigh up whether a part-time role would even be worth considering. And what about their own health and wellbeing? In August 2022, the Office for National Statistics (ONS) found that adults aged 50 to 65 who had left work since the pandemic and had not returned were more likely to have a physical or mental health condition or illness (51%) than those that left since the pandemic and returned to work (43%). And of those who hadn’t returned to work, just under one-fifth, (18%) said they were currently on an NHS waiting list for medical treatment.

Battling ‘ageism’ stereotypes

On the other side of the coin, evidence suggests that businesses are reluctant to hire older workers. A recent study by the Chartered Management Institute (CMI) found that out of the 1,000 UK companies they surveyed between October and November last year, only 42% of managers were open to hiring people between 50 to 64, in contrast to 74% who were open to hiring younger workers (people under 35).

This ageism is expressed through concerns that older people may have expectations of higher salaries, or that an employee over 50 won’t stay long enough, or they're not as productive, or will take more sick leave. Many of these stereotypes aren’t true, for instance the average tenure of a 25 to 34-year-old worker is 2.8 years, over three times less than the average tenure of a 55 to 64-year-old (9.9 years). Then there are some organisations that just want a young culture.

Some employers are breaking the mould and are actively thinking about how they can reach the older audience with their job ads and recruitment strategies as part of their D&I approach. Insurance firm, AXA UK, claims that 25% of its workforce is above 50 and has policies in place to allow for flexible working, sick leave, and caring dependencies; it’s also been accredited as a Menopause Friendly Employer. And motoring and cycling company Halfords, is looking to attract new skills to the workplace by branching out to all ages to join their apprenticeship scheme – their eldest is 68 years old! And, back in 2017, Co-op Funeralcare’s 1,500th and eldest apprentice was a 67-year-old ex-detective sergeant.

For some active job seekers aged 50 to 64, retraining or taking on a new qualification is their only option for finding a new role. But while some people relish the opportunity to take on a masters in a completely new subject, others don’t have the luxury of being able to self-fund the qualifications themselves. It will be interesting to see how many people will take up the newly announced ‘Returnerships’ and how these will be targeted at older workers.

What’s the silver bullet?

So, what are the solutions that will see more 50 to 64-year-olds back in work?

By abolishing the lifetime pension allowance, the government is hoping to entice the over-50s who took early retirement for tax reasons back to work, and they’re also making more places available on skills bootcamps to encourage those who’ve already left the workforce back into employment.

The mid-life MOTs that focus on a person’s finances, skills and health, may also help to keep individuals in the workforce longer by placing an emphasis on preparing better for retirement and building financial resilience; but these won’t be a quick fix.

Two other suggestions that weren’t mentioned in the budget included: incentivising those that are still working – but are thinking of retiring – to delay, and pumping money back into the NHS to clear their waiting lists.

In the meantime, there are a few resources that job seeking over-50s can try. Restless.co.uk – said to be the fastest growing digital community for the over-50s – links up age diverse employers with skilled older professionals to fill flexible, sometimes part-time jobs. The site also hosts webinars, provides pension advice and even offers a dating service. Of course, there’s also LinkedIn, and there are heaps of tips online to curate that perfect profile. Working Wise is another job search site aimed at helping the over-50s find work and shares some useful articles too.

Dr Denise Taylor’s book, You’re Hired! Find Work at 50+: A Positive Approach to Securing the Job You Want, offers a plethora of guidance. Whether a person is looking for a change of career, a shift to self-employment or wishing to reduce their working hours to free themselves up for other pursuits, this book helps readers refocus and build their confidence back in the job market.

If going back to working for another organisation doesn’t appeal, there’s always setting up on your own. In 2019, it was recorded that one in five over-50s are freelancers, which is the largest group of sole traders in the country. Susan Noble helps these people make the plunge with her Start Up School for Seniors. She guides people with her workshops and seminars to build their own businesses and offers a range of different programmes to suit the individuals’ needs.

Final thoughts

So, will Jeremy Hunt’s proposals see a flood of over-50s stepping back into the proverbial office? It seems he’s unlocked the door to opportunity; however, it’s unlikely that he’ll see those over-50s who have comfortably retired return, but there is hope for the 500,000 that are seeking work. Most importantly, drastic change is needed on behalf of employers to create accepting, flexible and diverse cultures for all ages. They need to retain their older, talented employees if they would like to continue to work, helping pass on important skills and experience rather than losing it. Providing ‘returnerships’, upskilling and training, and becoming truly flexible will be key – if employers don’t do this, they could be missing out on unique, highly skilled and thoroughly dedicated individuals in the 50 to 64-year-old category.