Insurance company Aviva has predicted that workers aged 50 and above will become the largest group in employment by 2024, representing one in three of all employees.
The firm’s claim is based on new data from the Office for National Statistics, which found that almost 10 million workers aged 50-plus are now in employment in the UK.
The figures show the proportion of over-50s in the workplace has increased from 21 per cent in 1992, when these records began, to 31 per cent in 2016.
The ONS found that 1.14 million people were not looking for work because they had retired – 152,000 fewer than in 2015. It attributed the fall in people retiring early, following a peak of 1.6 million in 2011, to a rise in the state pension age for women from 60 to 65.
Alistair McQueen, savings and retirement manager at Aviva, said:
“Over-50s will become the leading group of workers within the decade and the idea of early retirement would be relegated to the dustbin of history if recent trends continued.”
Further research published this week by PwC estimated that the UK could add around 5.8 per cent to its GDP (around £105bn) if employment rates of workers aged 55 and above matched that of the highest-performing EU country, Sweden.
John Hawksworth, PwC’s chief economist, said the rising costs of pensions and healthcare for an ageing population could be offset by “tapping into the older workforce”. He advised businesses to adopt flexible-working policies, such as phased retirement, and to redesign offices and factories to better suit older employees.
“They should also take steps to achieve age diversity; for example, through opening up apprenticeship schemes to older workers so that they can capitalise on their experience. Reverse mentoring schemes can also enable younger employees to pass their digital skills on to older colleagues,” he added.
The ONS figures found the overall employment rate in the UK was 74 per cent – the highest since comparable records began in 1971. There were 31.6 million people in work, an increase of 461,000 since 2015. Average pay has risen to £472 per week before tax, up from £460 in 2015.
Gerwyn Davies, labour market adviser at the CIPD, said the boost to earnings may be short-lived unless employers are able to boost productivity to meet the additional cost of the national living wage.
“If efforts to improve fail to materialise, the obvious response from employers will be to cut back on overall pay awards or wider employee benefits,” he said.