Employment among workers aged between 60-65 has fallen by over a third since the start of the pandemic. Overall, older workers have faced the biggest drop in employment since the 1980s.
According to a new report by the Resolution Foundation, a think-tank focused on improving living standards for those on low to middle incomes, older employees and their level of employment have been significantly impacted by the pandemic.
Prior to COVID, this group had a record-high level of employment, standing at almost three-quarters (73 per cent) for people aged between 50-64.
However, this has since been disrupted by COVID-19. Among those employed in February 2020, over a third (35
per cent) of respondents aged 60 to 65 were either no longer working by January 2021, were furloughed or earning at least 10 per cent than their salary before the crisis.
These figures are comparable with the 41 per cent of under 25s who faced the same situation as a result of the pandemic. Additionally, this was almost double the number of people who were not in employment or furloughed between the ages of 40-44 (20 per cent).
The think-tank has suggested this could be a significant problem as, unlike their counterparts, older workers are substantially less likely to return to employment.
Between 1998-2020, of those aged over 50, only around three-fifths (62 per cent) returned to work within six months. This is compared to 74 per cent among those aged 16 to 29, and 72 per cent among those aged 30 to 49.
Additionally, the level of remuneration the older worker receives will likely be less on their return.
Workers aged over 50 who become unemployed experience hourly earnings which are almost 10 per cent lower than earnings in their previous jobs.
This has also already had an adverse impact on retirement plans for older workers with research from the IFS stating that 5 per cent of workers are planning to retire earlier whilst 8 per cent are now postponing their retirement.
As such, the think-tank has called for the Government to ensure support schemes, intended to improve long-term unemployment, will provide an equal quality of service for older and younger workers alike.
It urges employers to allow older workers to request flexible working from day one on the job and asks employers to offer a right to return to workers that take time off due to caring responsibilities or through ill health.
A spokesman for the Department for Work and Pensions reacted to these statistics:
Older workers are a huge asset to this country, and heading into the pandemic a record number of over 50s were in work.
As we build back better we’re helping hundreds of thousands of older workers to retrain, build new skills and get back into work through our Plan for Jobs and our 50 Plus: Choices Offer.
Agata Nowakowska, Area Vice President EMEA at Skillsoft, said:
The significant decline in the employment rate for the over 50s means it is crucial that older workers aren’t forgotten in government initiatives to help people get back to work. Indeed, the advantages of a workforce that successfully blends youth with experience are hard to dispute.
Multiple studies have found that gender, ethnically and culturally diverse organisations perform better. A University of Zurich study, for example, found that an increase in age diversity can have substantial positive productivity effects, particularly in innovative and creative companies.
Employers who invest in the wisdom brought to the workplace by maturity can foster the attributes that many contemporary business leaders say they value the most. From creativity and innovation, to emotional intelligence and an ability to cope under pressure, investing in workplace maturity is always money well spent.
*This research was obtained from the Resolution Foundation’s report ‘A U-Shaped Crisis: The Impact of the COVID-19 crisis on older workers.’