New data has revealed that men and women are working longer into their lives, with employment rates for the over-50s recently hitting a 32-year high, the Professional Adviser website reports.
According to official figures from the Department of Work and Pensions (DWP), in 2015 employment rates for UK citizens aged 50-64 were at their highest point since 1984.
The report shows that 69.4% of this demographic was still in work, totalling 8.3 million people. This number was up 12.2% from two decades ago in 1995, when it was just 57.2%. Perhaps most surprisingly, there were more than double the amount of workers over the age of 65 (10.2%) than in 2001 (4.9%).
However, the biggest change over the last twenty years has been in relation to women aged 60-64. This section of the workforce increased by 15% between 1995 and 2015, reaching 40.2%. Men in this age group also saw a slightly lower 13% increase during this time, with a total 58.5% in employment last year, compared to 45.5% in 1995.
The government says the increased figures for older workers are down to the higher pension age for women. However, this doesn’t explain the increase of women working in their 50s; furthermore, the average age that people retire for both men and women was on the rise even before changes to the female state pension age were made.
The state pension age is steadily increasing for women from 60 to 65, bringing it in line with the age that men can retire. By October 2020, the state pension age will increase to 66 for both men and women.
Steven Cameron – pensions director of Aegon UK – feels the most likely reason is that people are realising that they need to supplement their retirement incomes. While some people seem to be “waking up to the new era of pension personal responsibility,” there’s still “a long way to go” until the population engages with their savings enough to meet their retirement goals.
For wealth planner Gwilym Jones, the industry also needs to readjust to the ‘new normal’ of retirement. He told the publication that the trend of people working into later life is likely to continue, with Sanlam’s own research suggesting that “more than a third of the unretired over 60s population do not envisage being able to retire until after 70.”
“Given this trend,” he added, “it is vital that people do not fall short in their finances for retirement, and that they have a solid financial plan to help ensure they don’t simply run out of money in later life.”