Older workers crucial to future of UK economy, says new report
Ensuring older workers are able to stay in good-quality employment is essential to the future of the UK economy and will relieve pressure on public finances, according to a new report by the Centre for Ageing Better published today.
While overall numbers of workers aged over 50 have increased in the last decade - due in part to the baby boomers entering this age cohort and a greater number of women in work - there is still a sharp decline in economic participation rates after the age of 55, and a corresponding reduction in tax income.
The report points out that successive governments have focused employment policies on helping younger ‘NEETs’ (Not in Education, Employment or Training) - despite one in four older workers being out of work. Older workers who do fall out of work, remain out of work for longer than people of other ages and are more likely to say that they experience age discrimination.
Society is failing to realise the tax-raising potential of this age group, the report argues. Official figures show that halving the employment gap between people aged 50 and State Pension age and those in their 40s could see income tax and National Insurance receipts rise by 1% (just under £3 billion) and GDP up to 1% (£18 billion).
Changing workplace practices and creating an age-friendly employment culture is important for today’s older workers, and for younger generations, all of whom will face similar pressures as they age, the report says.
Patrick Thomson, report author and senior programme manager at Centre for Ageing Better, said, “Our analysis makes clear how integral older workers are to the future of the UK economy. Being in work is a way of redistributing income via the tax system for all. It reduces the welfare bill and promotes savings and financial independence in retirement. But despite this negative stereotypes towards older workers are still widely held. Ageism and misperceptions of older workers contribute to both employers and employees failing to take early preventative action. Caring responsibilities and health conditions for example tend to increase for many older workers yet many employers don’t offer enough support to help people manage these pressures alongside their working lives, which can cause them to leave work early.
“Older workers offer a solution to the fiscal challenge of our longer lives. We therefore need policy solutions that support and enable this increasingly important segment of the workforce.”
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