The big retirement is coming

The big retirement is coming

Growing up, I knew that becoming unemployed was the worst thing that could happen. My mom lied about her age to keep paying the mortgage until she was 74. My father dictated his last magazine article to me from his deathbed. Their jobs brought money, pride and meaning. So my reaction to Britain’s 9million not working and looking for work – some of them retiring at 50 – is both emotional and practical.

Has the pandemic triggered some sort of unique psychological switch in Britain? I’m starting to think so. As the Bank of England warns that shrinking our workforce could fuel inflation even in a recession, the UK is increasingly looking like an outlier. We were not the only country to emerge from the pandemic with lower employment rates than before, as were Iceland, Switzerland, Latvia and the United States. But these four bounce back; we are not. By March, the Institute for Employment Studies predicts that we may be the only developed country with an employment rate lower than it was before Covid-19.

I’ve written before about the growing number of long-term illnesses causing people to stop working, as well as the NHS backlog. But that’s not the whole story. Fifty-five percent of the increase in the number of “missing” workers comes from people aged 50 to 64. Many retire early not because they are too sick to work, but because they are tired of working. A new poll finds this group expresses greater dislike of their work than their German and American counterparts, and are more likely to say the pandemic has made them rethink. Plus, they think they can afford it. In the UK, 18% of economically inactive people aged 50-64 say they have improved as a result of the pandemic, compared to 8% in the US and 4% in Germany.

It would be the ultimate irony if a pandemic that has damaged our economy has left a whole section of the population thinking they can check. The poll was conducted by Public First for the think tank Phoenix Insights, of which I sit on the advisory board. The following quote made me wince: “Watching the older generation being pushed into the protective ring of the nursing home and abandoned to Covid made me realize that I was looking at a possible version of my future”. The interviewee took early retirement “to make the most of the time I have left”.

What have we done? The average death from Covid is 80, not 50. A government that has kept millions afloat with generous furlough payments has always left us feeling like we’re alone. Some over 50 care nobly for a spouse, an elderly parent or grandchildren. Some may have fallen prey to the WFH delusion: The Institute for Fiscal Studies found that working remotely makes people more likely to retire earlier. Others may have been led to believe that a more balanced existence could be supported by a furlough scheme that should have ended sooner – in a country that allows people to cash in their pensions earlier.

We may never know. But what is clear from several studies is that health and happiness later in life are strongly correlated with a sense of purpose. I predict a Grand Unretirement in a few years when the novelty wears off and real estate prices fall. At this point, we will need employers to realize that customers appreciate staff of the same age and that older people may be more loyal than younger ones. Campaign groups are advocating for more flexible working. But portraying anyone over 50 as in need of special treatment plays into ageism and does a disservice to anyone in that age group who is at the top of their game. Despite the tight job market, I meet qualified accountants, academics, consultants and surgeons whose employers seem determined to get them out at 60.

“Training” is also presented as a panacea. But you have to adapt it. The challenge of persuading affluent professionals not to retire is very different from that of helping the 8.7 million people currently applying for means-tested unemployment benefits. The pandemic has led to a sharp increase in the number of people receiving benefits without “working conditions” – or without an obligation to seek employment – ​​due to reported mental health problems or long-term illness. The Center for Social Justice estimates that this group now numbers 3.5 million and urges the government to support the one in three who say they want help getting back to work. Could another consequence of the pandemic have been that the Department for Work and Pensions did not do its job?

Delving into the DWP data is a sad reminder of Britain’s long-term unemployment history, which has been masked for so long by immigration. Levels of economic inactivity are most acute in some of the most deprived parts of the country, among people with disabilities and single parents for whom the stress of recent years must have hit particularly hard. Progress has been made in closing the gap between these groups and others over the past decade – but that has now been reversed. If we could close just half of those employment gaps with the best in Europe, according to the IES, there would be a million more people at work.

Good health is the cornerstone of the ability to work, but it’s hard to pinpoint. Poor health is increasingly cited as the main reason for inactivity – but the second most important condition, after heart problems, is not mental illness or a back or digestive problem, but “other “. If this is a call for help after the appalling strains of punitive lockdowns, it must be answered.

I continue to believe that work is the best way out of poverty, a great way to maintain a sense of purpose later in life, and to support mental health. If the British decided it was optional, even hostile, we’re in serious trouble.

#big #retirement #coming

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