The coronavirus pandemic could see a record number of over 65s being forced into early retirement as employment among this age group has fallen by nearly 12 per cent.
Employment figures from the Office for National Statistics, published today (August 11), showed both the youngest and oldest savers were most likely to have lost their jobs as a result of Covid-19, which could cause a knock on effect on their pensions, according to Aegon.
The data showed employment among the 16-24 age group dropped by 100,000 in April to June to hit 3.72m, a 2.6 per cent decrease on the beginning of the year.
But amongst the over 65s, employment is down a record 161,000 to 1.26m, a fall of 11.3 per cent from the previous quarter
Steven Cameron, pensions director at Aegon, said chancellor Rishi Sunak’s kickstart scheme would make a “big difference” to the youngest workers but warned there were no initiatives aimed at the older society, meaning many will be "kickstarted out of work and into retirement earlier than they had planned”.
Mr Cameron said: “In recent years we’ve seen an accelerating trend towards people transitioning into retirement, continuing to work after traditional retirement ages often on a part time basis.
“For some, this is to remain active while for others, with gold plated final salary pensions largely a thing of the past, it’s a financial necessity.
“Unfortunately, it looks like for many, what they’d hoped would be a gradual transition has turned into a sudden departure from work.”
He added: “This shows how important it is that the government looks at every age group and considers how best to support them as we tackle the Covid-19 crisis.
“Anyone whose retirement plans have been disrupted by an unexpected loss of employment in later life should consider seeking financial advice to explore their options.”
Alistair McQueen, head of savings & retirement at Aviva, agreed that older savers must not be left behind when trying to deal with the outcomes of the pandemic.
He said: “The need to support younger workers in the wake of the pandemic has already been widely recognised by the government and employers, but we must not forget those at the other end of the spectrum.
“Over the past decade we have seen a boom of older workers contributing to the economy. Before the pandemic hit there were a record 1.4mn workers aged 65+ in the labour market.
“Any loss of this older workers brings with it a huge loss of experience, skill and potential. And for the individual, it removes their ability to contribute and challenges their ability to fund their retirement.”
Across all age groups, employment decreased by 220,000 in Q2, which was the largest quarterly decrease since May to July 2009 during the financial crisis.
Both men and women in employment decreased in the quarter, by 135,000 and 85,000 respectively.
The decrease in men's employment was the largest seen since July to September 2011.