The evolution of working patterns in old age – Institute for Fiscal Studies



Longer working lives offer many benefits, but achieving them can pose challenges for individuals, employers and policy makers. In order to help people in their 50s and 60s stay longer in paid work, it is imperative that we have a good idea of ​​what paid work looks like in old age and how it might evolve. in the future. The work patterns desired by older workers – in terms of hours of work, form of employment or tasks they undertake at work – can be very different from those of middle-aged or younger adults.

An aging population and higher employment rates for those in their 50s and 60s mean that the work patterns of older workers are a growing problem for the country as a whole. Indeed, in 2019, around 10 million or 61% of people aged 50 to 69 were in paid employment, meaning that this age group represents almost a third (31%) of the workforce. works in the UK, compared to just 21%. in 1992.

In this report, we provide new evidence on the nature of paid work in old age, how employment patterns differ among people in different circumstances, and how the situation changes over time. In particular, we take an in-depth look at the transitions older workers make, both in and out of work and between different types of jobs as they approach retirement.

After providing a comprehensive picture of the working lives of people in their 50s and 60s, we then examine the implications of our findings for some key issues that older workers will face in the labor market in the years to come, including groups that could be of particular concern in the aftermath of the COVID-19 pandemic. These questions are important not only for the individuals themselves, but for policy makers who seek to encourage people to lead longer and more fulfilling working lives, for employers who would benefit from employing them, and for organizations in the workplace. civil society and government agencies interested in helping older people. to find productive work that allows them to balance their professional and personal life.

Main conclusions

  1. Many people in their 50s and 60s are likely to face significant challenges in finding a new job after the leave plan ends. Older workers, especially those over 65, were more likely to be on leave than middle-aged workers – at the end of April 2021, 14% of workers over 65 were on leave, up from 10 % of those aged 40 to 49. There may well be a significant number of older job seekers in the coming months.
  2. There are a number of reasons why finding a new job can be difficult for people in their 50s and 60s. Most older workers do not have much recent job search experience: more than two-thirds (69%) of 55-year-old workers have been with their employer for more than five years. Only 4% of older workers usually change employers in a single year. Older workers are also less likely than younger workers to change occupations, which may be necessary if vacancies are not available in their current industry – and this is something that could become more prevalent. as the economy adapts to new ways of working and spending the pandemic.
  3. Older job seekers from lower socio-economic groups are more likely to have difficulty finding a new job after a spell of unemployment. People with less education, the long-term unemployed and women are particularly less likely to return to work at an older age after losing their job.
  4. A significant number of older workers would benefit from reduced working hours and greater flexibility. 16% of working 50-69 year olds would like to work fewer hours, compared to around 14% before the Great Recession. That is an increase of about 230,000 people. People in their 60s, those who own their homes, those who report a limiting health problem, and those who have been in their current job for longer are particularly likely to want to work less.
  5. For some older workers, part-time work is a means of gradually making the transition to retirement. Switching to part-time work at an older age is more common among people with higher levels of education and living in less disadvantaged areas – which could indicate differences in access to part-time work or differences in financial constraints that affect people’s ability to reduce their hours.
  6. Only 9% of older employees become self-employed as they approach retirement. Transitions to self-employment are more likely among men and those with a history of self-employment earlier in life. Since self-employment is a form of flexible working where people have more autonomy over their hours, policymakers should consider whether older workers could be encouraged to consider the possibility of being self-employed as a way to extend their lives. professional.
  7. Half of full-time workers go directly into retirement without work, without any intermediate step. A particularly important factor predicting the direct transition from full-time work to retirement is membership of a defined benefit pension: people receiving such a pension are 13 percentage points (ppt) more likely to move directly from work. full-time retired than others. These pensions are particularly common in the public sector. As public sector pension reforms have resulted in reduced financial disincentives associated with working fewer hours before retirement, public sector employers should consider how best to support employees who wish to move on. gradually retired.
  8. There is a small but significant portion of the older workforce who would like to work longer hours. About 7% of older workers in 2019 wanted to work more hours per week, more than the 5% observed in 2007 before the financial crisis. That’s an increase of about 190,000 people. They tend to have less secure working conditions, such as having a temporary employment contract. They are more likely to have low incomes and shorter employment times, to be in their 50s rather than 60s, to be men and to work part time. Self-employed workers are also more likely to want to work longer hours, pointing out that the flexibility of self-employment also comes with risks.
  9. The labor market position of people in their 50s and 60s with long-standing health problems requires special attention. About 49% of people (and 39% of workers) aged 50 to 69 report a long-standing health problem. Older workers with long-term health problems and limiting work are 5 points less likely to have paid work in a year than similar workers without such a health problem. People who work with a health problem are also much more likely to retire after a period out of the workforce.
  10. Some people in their 50s and 60s with long-standing health problems may have preferred, and were able, to stay at work if they had more flexibility or support. This is because people with a health problem are around 4 ppts more likely to want shorter hours than those without a health problem.
  11. The working lives of the men and women approaching retirement over the next decade will be very different from those of those who did over the past decade. In the future, those nearing retirement are increasingly likely to take on more stressful and cognitively demanding jobs. Currently, older workers in these types of jobs are much more likely to want to work fewer hours, but are in fact less likely to be in part-time positions. This suggests that ensuring that appropriate flexible work options are available for this group should be a particular priority in the years to come.


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