The issue of an ageing workforce driven by delayed retirement is a hotly debated topic.  Recent research, conducted by the Centre for Economic and Business Research (Cebr) and Wealth Wizards, throws a new light on the implications of working over the age of 65 for both employees and employers.  Some of the results were unexpected and it is likely that these insights will help to inform the pension sector, UK business and government agencies.

Nation wants to retire at or before 65

A massive 86% of people stated that they want to retire at or before 65, but only 37% believe this to be an option.  A further 20% believe they will never be able to retire due to poor financial planning; that’s over 6 million people today who could be working beyond retirement age into their eighties. Extrapolated further, this means that, on average, employees would need to work nine years longer than originally planned.

Drivers of the retirement gap

The report identified pension under-saving as a key driver of the retirement gap, and one of the main causes that will lead to an ageing workforce, potentially into their eighties.  Over half expressed regret that they had not added more to their pension when they were younger.  The report also identified that today’s youth are already concerned about their lack of pension savings with almost half expressing fear despite retirement age being some decades away.

Employers embrace an elderly workforce

Almost half of employers (45%) said that they would relish their employees working into their eighties and rate the benefits of an older, motivated workforce such as life experience and industry and company knowledge.  Additionally, they believe there is a great deal of value in motivated individuals who can afford to retire but choose to continue to work out of dedication to their job.

However, there are productivity costs associated with those employees who lack motivation because they feel they are ready to retire but are forced to continue working by circumstance.

Employers could do more

Half of employees over 55 believe that their employers should be doing more to guarantee their financial stability in retirement.  This rises to 59% amongst those aged between 18 and 34 demonstrating that there is a strong appetite amongst this group for employer assistance in planning for their older age.  Providing access to financial information is important, but there’s no substitute for providing people with personalised recommendations around what to do with their finances in the form of regulated financial advice.   This is increasingly being done in the workplace as employer’s partner with external digital advisers.  The research shows that over one third of employers are only matching employee pension contributions up to the legal minimum, which up until this month was just 1% of earnings. Just 17% of employers were matching employee contributions to between 1-3%, and only 24% were matching beyond 3%.


The research confirms that many employers are not providing enough support – whether it’s pension and retirement advice or adequate contributions to pension schemes.  Although there is an associated cost to firms with increased contributions above the legislated minimum, adopting an attractive pension solution for employees is likely to improve staff retention.  When talent is in short supply, then a pension solution could be a true differentiator.

In addition, while it is reassuring to see that a large number of employers are willing to employ an elderly workforce, and that some individuals choose to work for longer, we cannot forget that 86% of employees polled in the research said that they want to retire at or before 65.  Providing pension advice to employees can be a cost-effective option due to the advances in professional, fully-regulated digital advice.   This could not only prevent delayed retirement by offering employees much-need support, but it can also improve goodwill and strengthen employee loyalty.