/ Money

Are older workers blocking the job market?

Young man holding an unemployed sign

New research shows that the number of long-term unemployed is at its highest since 1997, with the largest rises among the over-50s. Maybe it’s time to target the over-60s ‘job-blockers’ and force them to retire?

Nearly half (45.9%) of over-50s who are unemployed have been out of a job for a year or more, up from 31% in 2009, according to the thinktank Institute for Public Policy Research (IPPR).

And the squeeze is happening at both ends. Just over 10% of unemployed 18-24 year olds were out of work for more than a year in the mid 2000s. That proportion is now 27%.

Fierce competition for few jobs

It’s only going to get worse. For a start, the impending huge increase in university fees will force hundreds of thousands of young people into the workplace at 16 or 18. Coupled with local government spending cuts and a clampdown on benefits claimants, the number of people fighting over every job vacancy is likely to surge.

So what’s the answer if you’re in your 50s and 60s and find yourself out of a job? Some firms are well-known for employing older workers – B&Q and ASDA spring to mind. And yet, while customers and companies undoubtedly benefit from having older staff members, many of these jobs make insufficient use of the expertise and experience they’ve gained elsewhere.

Should older job-blockers retire?

Maybe we’re asking the wrong question. Rather than questioning how we get the over-50s back into jobs that simply don’t exist, perhaps we should force those over state retirement age to actually retire? In other words, address the ‘job-blocking’ issue (similar to the NHS’s previous bed-blocking problems).

Of course, that would require everyone to have suitable financial plans in place which would allow them to retire comfortably. And that in turn means saving more, and for longer. Auto-enrolment and NEST have made a start in addressing this point, but the hard fact is that there just aren’t enough jobs to go round and the state can’t be relied upon to provide a generous safety net for those without a job or in retirement.

So what do you think? Here are a few options to start you off, none of them perfect, but some of them perhaps unavoidable?

A. Reintroduce enforced retirement once you reach state retirement age.
B. Introduce tax incentives to encourage retirement at state retirement age.
C. Raise the state retirement age yet further, ploughing the state pension cash saved back into job creation schemes and tax incentives for employers.
D. Force people to pay into a pension from a much earlier age.
E. Introduce obligatory income and unemployment insurance for all adults.

Comments
Guest
Richard says:
9 June 2011

I am not sure I am believing what I am reading here. Age discrimination is one of the last great discrimination areas that we are trying to eliminate – so we don’t need any backward steps. The stance is morally indefensible. Solving one injustice by creating another one is not a very intelligent way forward. Why not remove all women from the workforce to reduce male unemployment? Because it is unacceptable and abhorrent – that’s why!

For more see http://www.inmyprime.info

Guest
Martha says:
9 June 2011

The tone of this, and much of the content, is quite repellent.

Perhaps those greedy ‘job-blockers’ have to work to survive. Very selfish of them to want to pay their bills, and buy food and so on, I know, but what can you do?!

Guest

Hi Richard and Martha. Thanks for your comments.

The core problem still remains that there aren’t enough jobs to go round. An increasing number of over-18s will be hitting the jobs market early, while the increasing retirement age will mean there are more people looking for jobs in the higher age group too. The effect is already becoming apparent through the rising number of long-term unemployed.

I don’t know what the perfect answer is, nor am I sure if anyone has anything approaching one. Quality job-creation would be the panacea, but how do we achieve that? And as I said in my original post, it would be impractical to force people to retire at a certain age unless they have sufficient means to retire on, which in turn throws up a whole new set of challenges relating to the financing of retirement.

I’m keen to discuss the options and find a solution to the issue. Any ideas?

Guest
Brian Ormondroyd says:
10 June 2011

Given one million young unemployed and tens of thousands ‘staying on’ or graduates with little chance of employment there must be a radical and quick response.
Pensions for all at 60. at a scale that allows a decent standard of living.
Compulsory retirement at the above age. Opportunities allowing for voluntary work and an expansion of adult/bus pass generation learning.
Drastic – but otherwise a generation of young people growing old without ever working plus all the attendant problems.
ln effect we would be transferring benefits to the old folk and giving the benefits of a useful, productive and meaningful life to our youngsters.

Guest
joe says:
22 June 2011

I really liked your Comment,This would be a great way to deal with the problem.

Guest
Phil says:
10 June 2011

Pensions for all at 60.

Where exactly is the money going to come from? The Government can’t afford to meet its current pension commitments. It’s one thing saying people should be forced to pay into a fund from an early age but that’s going to take 40 years or more to yield results.

Guest
L. Strilciw says:
18 March 2016

I have been working since I was 15 3/4 . . Which in those days you could if you gained full time employment. I left school because my family circumstances.I am now 60. An age I expected to retire at. Work for the nhs and paid into their pension. The government raised the age I can’t retire till 66. A recent quote says I have 44 years contributions and will have 50 by the time I can retire. My late husband died 7 years ago and like me worked all his life. I received a widows pension for ONE year after his death and nothing after that except what I earn. So I would love to finish work . Let a younger person have my job . . But do you want to tell me what I live on . It certainly isn’t on the nhs pension which would pay my utility bills but nothing else. A government pension would help . . The one I should have received and where will they get the money you ask .. . I as I said have a paid 44 years so for me that’s where they can get it from.

Guest

If one accepts that there arent enough jobs to go round then directing money to “encourage” older workers to retire makes long term sense for the economy and society.

However to enable people to retire and release jobs requires higher pensions so either compulsory pension contributions or higher tax to pay for state pensions and safety nets.
Whichever way will result in less disposable income for those working.

Guest
Em says:
10 June 2011

This view of how the job market operates is just naive … .

In a few months I will become one of the over-60’s “job-blockers”, hopefully continuing to earn in excess of £50K. A nice opportunity for as many as *two* UK university graduates to step into gainful employment, if I were to retire on a state pension – funded by said graduates – you might think.

Wrong! When I decide to retire, my role will be off-shored to a foreign university graduate who, I like to think, will be less effective than myself, but the UK corporate I work for will happily trouser the other £40K, to be paid out in dividends and executive benefits for “increased efficiency”, not new UK job creation.

Unfortunately, today’s corporate social responsibility does not extend to maintaining a UK workforce. As one commentator put it – we are destined for a world where the only professions are CEOs and hairdressers.

Better, perhaps, that us oldies hang onto our jobs and the income remains in the UK for the time being. Through the kind auspices of HMRC, a contribution to unemployment benefits of the young will be made and what is left can be spent on UK goods and services.

Meanwhile, Which? could do better by lobbying hard to stop UK companies exporting their onshore workforce and abusing immigration loopholes in a race to the bottom. Be very careful what you wish for.

Guest
sortitout says:
5 February 2012

I agree with EM I am in my late 40’s unemployed after redundancy and already I feel like I am being considered as too old to work! Older workers have always been in the job market and they should remain so for as long as they like because they in the most part have both the experience and brains to keep this Country afloat. Lets remember one important thing it wasn’t the older workers who brought the banks and the world economy to it’s knees and it isn’t the older workers who have made such a mess of sorting it all out again. An older worker simply wouldn’t have taken the risks the banks took!!

Here are a few solutions I think would help us all out in the long run.

A. Create a new law demanding corporate social responsibility to maintain a majority percentage UK workforce where it is possible to do so. If services are to be migrated outside the UK then the companies will have to prove that this is justified under set criteria of rules to prove that the migration and its impact on the UK workforce are needed and not just simply for extra shareholder profit.

B. Come out of the EU agreement allowing EU member state workforce migration until all FULL UK citizens are gainfully employed (regardless of age) or perhaps introduce a UK citizen quota and a tax incentive to companies willing to train the UK workers of all ages to do the work they say they can’t at present and this will stop the excuse of UK companies that UK workers don’t have the skills they need so they are forced to look abroad for workers.

C. Introduce a new sort of combined compulsory works/state pension scheme to all new (young) employees where the national insurance contribution payments will be slightly higher to allow for a decent pension later in life. The employee will pay just a little (due to early contribution collection) the company will match this nominal amount and so will the government. The combine 3 contributory payments at a young age will produce a significant result over the employees working life cycle as the pension will move with the employee from company to company within the UK.

D. Introduce a fairer employment discrimination act that has teeth and will if need be will introduce employment quota’s to companies believed to be unfairly discriminating against any group or abusing discrimination laws in favour of other groups.

Guest
evie says:
10 June 2011

I too will shortly become an over-60 “job-blocker” – not quite earning at Em’s level (less than half) and hoping that I will be able to continue at least for a few more years until the mortgage is paid off!
However realisitically there is no prospect of anything like full employment in the foreseeable future, and the younger generation will never have a chance if we hang on too long. My personal feeling is that when I reach the age at which I will qualify for a state pension I should at the very least start to consider retirement, on the gounds that my pension, while not a fortune, will be a good deal more than the benefits available to a young person trying to find work. And there is no need to feel that retirement means being cast aside – there are a huge number of opportunites for offering service on a voluntary basis. After all, we are lucky enough to have lived through an age of reasonable prosperity; given the current economic situation, it is unlikely that the next generation (or the one after) will experience the same level of good fortune.

Guest

I am one of the over 50’s who have been out of work for nearly a year. There is no easy answer to the this problem. Jobs are being cut, jobs are being exported and jobs are being downgraded to enable employers to pay less. There is a pensions crisis so I now will have to ‘work’ until at least 67, so goodness knows what the outcome will be for the 18-25 year olds. More part-time/job share work – ooh I must be in la la land as anything that puts up the cost for employers is being ignored – the Government does little to support the unemployed and it will get worse. Let’s face it, we are no longer a great manufacturing country, we survive on the euphemistically ‘service’ sector (yet every time I want a service I inevitably get through to another country). Too many people here, too many young people with degrees with no ‘degree’ jobs available, and too many over 50’s being surplus to requirements. Did anyone see the Panorama programme ‘Finished at Fifty’? I did, and then e-mailed the minister who was interviewed after, explaining all the efforts that I have made to get a worthwhile job and guess what, I haven’t heard a word from him as I was doing all the things that were being suggested to the three people who they interviewed. Hey ho, back to reality………….

Guest
Rose says:
23 June 2011

What a relief to see someone else “going public” with similar views/experiences as myself! Too often we 50-somethings feel we have to just grin and bear it.
I sent a lengthy email to our newly-elected MP at election time telling him about the “new poor” (usually 50-something women who were financially secure all their lives until ageism hit them as soon as they hit age 50 – and after the new ageism laws came into being too!). I am seeing so many of my friends and former women colleagues getting to age 50 then finding themselves redundant with no way of getting back into work at the level – let alone pay! – they were before. Yet we were all career women who had achieved professional qualifications whilst working long hours, expecting to have the option to continue work at a senior/well paid level until age 60, and still with more skills and open-ness to change than many of the younger workers in the organisations we worked in! Needless to say, I had no response from my MP.
What makes it even more annoying is that our partners could be being taxed as so-called “higher rate earners” when we were the main “breadwinners” and our household income has dropped by well under half. It is also noticeable to me that my brother, who works in roles and organisations very similar to myself, has had no similar experiences, nor have his male friends/colleagues ….. Perhaps there’s still a “boys club” which ensures the majority of men are kept in employment till retirement whilst women are thrown out to keep the jobs for the boys! It’s certainly the case in the industry I worked in.

Guest
Maggie says:
18 June 2011

Perhaps if the government stopped pensioners having to pay tax on savings and any extra pensions they have managed to accrue there would be more pensioners able to retire completely. Or is this just too easy and simplistic a suggestion?

Guest
Rose says:
23 June 2011

The other point I would like to make is that a person can do everything they should do (regarding pension contributions, savings and the like) but all their good work and retirement preparation can be taken away in a very short space of time by (a) companies mismanaging pension schemes or transferring the pension “pots” around from management company to management company, meaning that poor investments and fees reduce the pension pot, and (b) redudancy or other situations (and not qualifying for benefits) meaning every savings pot built up over many years has to be raided in order to survive in the years up to so-called retirement.
I think a certain amount of pension contribution should be compulsory but more money needs to be put into retirement provision by the government, not less. If there isn’t enough money then we need to cut back on services being provided free to non-UK domiciled people, aid to other countries – especially countries like India who should be supporting their own populations now – and “nice to haves” like new monuments.. The priority in this economic climate needs to be to the UK’s own population, for essential needs before any luxuries, and the amount you receive should be governed by how long you’ve lived here and how much you’ve contributed to the State during that period.

Guest
George says:
26 June 2011

Do you think in this day and age it is easy to retire. When you get a state pension which has probably been paid for over 40 years plus: then your Personal allowance is taken of it, then you lose a wage and try to survive when prices are going up. well some people I know are on benefits that dwarf my ?income.Before you say we should have saved more, any of you remember when the mortgage was 15%.

Guest
Ian says:
6 July 2011

I’m 52, highly skilled, and unemployed for 3 years, but not claiming benefits. I have experienced age discrimination first hand. A large company told me after interview they would keep my CV on file ‘in case a more senior job came up’. That’s after I said “I need a job, pay me whatever you like”. It is not the case that company directors have taken an ageist stance. The trouble is that youngsters of around age 30 have been promoted to the position of deciding who works or not, and they don’t like the idea of a much older possibly more experienced person being around, who might upstage them. I don’t go off sick. I’m a rock drummer, and skateboarder, a teenager in all but name. Enough of the zimmer talk. Ending immigration would be a good start. Or ending the public sector.

Guest
Dick Stroud says:
17 July 2011

All very interesting comments. But – where does the fact that 80% of all new jobs created are taken by recent immigrants to the UK come into the equation? Whenever companies are researched about employment issues they respond that they cannot get workers with the right skills.

The simple but terrible fact is that we have an education system in the UK that is incapable of creating young people who are employable – certainly not enough of them. Why are more over-50s employed – because they exhibit the right work attitudes and have the right skills?

It is like forcing universities to take poorly educated school children. It attacks the symptoms not the causes. Finally, don’t forget that the UK, along with much of Europe, is a country in economic decline and whilst there will be a wealthy strata to society the majority had better get into the habit of living on less state aid and with diminished standards of living. You had better wake up and smell the coffee

Guest
cynical says:
4 August 2011

Does the writer of this article think it gets cheaper to live a reasonable lifestyle when one gets older?
Guess he thinks that eveyone should have made provisions in their formative years, easier said than done if you`re average working class. Easy if you`re on the average wage, what is it now 26k+? Where`s that figure come from?, oh yeh 15k + 37k = 26k nice.
This country & the people for putting up with it must be the laughing stock of the world. In the economic state we`re in what other country would give aid to a country that can afford to have nuclear weapons? What country would allow in economic migrants & pay benefits for their families back in their own country, people who haven`t contributed one cent to our economy. Then there`s terrorists instigating our slaughter who we can`t deported because they might have their human rights infringed, shame. When will we get a government that does what it`s supposedly elected to do & look to our needs. Never, every day there`s yet another news story of bribery & corruption in every walk of life & when the perpetrators do get caught out they get a slap on the wrist & found another job, the people in power daren`t do any other for fear of what might be revealed if proper penalties were doled out. There had my rant now & don`t pretend to have all the answers but I think a good start would be getting rid of some of the do gooders who bleat on about human rights.
All this may seem off the point but all the time we`re prepared to accept this corruption we`ll never get a fairer society but don`t forget what Cameron said, ” We`re all in it together”, right, in what?

Guest
sortitout says:
5 February 2012

Remember the older workers created the country we live in so please leave them alone and it was the younger less experienced workers who broke the world banks and economies. An older worker simply wouldn’t of taken such stupid risks!! Young and old have always worked well together and leaned from each other we should be promoting that as the way forward. You want your training costs reducing then employ one older worker and one younger worker the older workers will pass on their experience and the the younger worker will teach the older worker new ways of dong things It has always been that way and worked very well until now!

I am 47 and already I know I am unlikely to get a full time job again unless something is done and quickly to get the country back on it’s feet.

A. Create a new law demanding corporate social responsibility to maintain a majority percentage UK workforce where it is possible to do so. If services are to be migrated outside the UK then the companies will have to prove that this is justified under set criteria of rules to prove that the migration and its impact on the UK workforce are needed and not just simply for extra shareholder profit.

B. Come out of the EU agreement allowing EU member state workforce migration until all FULL UK citizens are gainfully employed (regardless of age) or perhaps introduce a UK citizen quota and a tax incentive to companies willing to train the UK workers of all ages to do the work they say they can’t at present and this will stop the excuse of UK companies that UK workers don’t have the skills they need so they are forced to look abroad for workers.

C. Introduce a new sort of combined compulsory works/state pension scheme to all new (young) employees where the national insurance contribution payments will be slightly higher to allow for a decent pension later in life. The employee will pay just a little (due to early contribution collection) the company will match this nominal amount and so will the government. The combine 3 contributory payments at a young age will produce a significant result over the employees working life cycle as the pension will move with the employee from company to company within the UK.

D. Introduce a fairer employment discrimination act that has teeth and will if need be will introduce employment quota’s to companies believed to be unfairly discriminating against any group or abusing discrimination laws in favour of other groups.

Guest

In the recent BBC series ‘The Town That Never Retired’, where 70+ pensioners were sent back to work (along with young job seekers), the experts they talked to dismissed the idea that older workers staying on after retirement age affected younger worker’s job prospects. The figures show that, in general, the more elderly people are employed, the more young job seekers get work.

I don’t recall the explanation for this, but I suspect the types of jobs taken by each group are different.