One in three employees will be more than 50-years-old by 2025, with the Centre for Ageing Better saying “older workers are the workforce of the future”.
However, since the pandemic we have seen a wave of resignations and early retirements in this age group, with data from the Office for National Statistics revealing three in five over 50s have left the workforce sooner than planned.
This comes as the UK faces a skills shortage and many employers are struggling to recruit talent. A report from Monster – Flexible Future: UK Hiring Outlook 2022 – found that 90 per cent of UK employers are planning to recruit in 2022, up from 66 per cent in 2021.
It revealed 87 per cent of employers say they are struggling to fill positions, and just over half said that finding candidates with the skills they needed was their main challenge.
A report from the Financial Services Skills Commission in March highlighted that financial services companies face stiff competition from other industries in accessing skills, and that in 2021 92 per cent of businesses had hard-to-fill vacancies.
Taking steps to keep the over 50s in the workforce has never been more important as employers do not want to risk losing valuable skills, knowledge and experience at a time when businesses are still trying to recover from the pandemic and when the economic outlook is bleak.
Also, people in their 50s these days are more likely to be in the middle of their careers, rather than thinking about their retirement and could have another 20 years of work ahead of them. Staying in work will be a necessity for many, as they may have insufficient pension savings.
In April 2022 analysis by the Pensions Policy Institute and B&CE, provider of The People’s Pension, found that more than half of households in the UK are not saving enough to maintain their work life living standard in retirement.
Another report by Deloitte suggests UK savers will have to find on average an additional £10,000 each year between now and retirement if the nation is to meet a growing savings gap that could hit £350bn by 2050.
Changing aspirations and people living longer and healthier also means that people do not just want to wind down in their 50s as they head towards retirement. Many want to continue in the workplace for longer, some are starting new careers in mid-life, and others are coming out of retirement.
As the workforce and population ages, employers will increasingly need to draw on the skills of older workers and find new ways to retain them. They are a valuable part of a multigenerational workforce and bring enormous benefits that companies cannot afford to lose.