Should older people be encouraged to stay on longer in paid work?

In many countries governments are encouraging older people to remain longer in paid work. Is this a good idea? What are the benefits and dis-benefits for individuals, the economy, society and business? I have been tossing around these questions and they will be the focus for my next few blogs . 1

Benefits for individuals

We are living longer and have better health in later life. This provides an opportunity for working longer. There is evidence that meaningful and appropriate work benefits the wellbeing of older people. It provides a routine and structure to life, social contact and camaraderie, when so many may feel lost and directionless in retirement. There are also studies which link “productive engagement” to improved health and functioning for older people.

Paid work will increase their incomes, helping older people to achieve higher standards of living. For some, of course, continuing to earn is an economic necessity, if people have lost savings or need to repay debt.

Dis-benefits for individuals

At what age do these benefits cease and how much work is too much? A “work till you drop” approach could lead to higher health costs, especially for workers in stressful or physically demanding occupations. A leisurely retirement is seen as a legitimate phase of life, earned by a lifetime of paid work. Employees and their unions have fought for the right to retire on a decent pension. If people do not have this to look forward to, the morale of the workforce could drop.

Earlier, I associated the benefits with “meaningful and appropriate” work. What does this mean? Older workers may feel they have very little control over how they do their jobs and may be given limited opportunities for training, career guidance and promotion, leading to low job satisfaction. There may be physical stress from heavy work; psychological stress from constant change in the workforce and from age discrimination in all its forms. These can be intolerable at a time of life when age-related health problems may be beginning to affect some people.

Benefits to society and the economy

Keeping older people in paid work will contribute to economic growth. If we cannot improve productivity to compensate for the predicted slowdown in labour force growth through population ageing, then the economy will suffer along with our overall standard of living. If working older people continue to pay tax through wages, this will make it easier to offset the increased health and support costs of an ageing population.

Society will be worse off if older people are not given the opportunity to use their skills and experience. They can be role models and mentors in workplaces and in the community, helping to break down ageism and negative stereotypes. This will also contribute to social solidarity, avoiding conflict between the generations.

Dis-benefits to society and the economy

If older people stay longer in paid work then who will do the unpaid work in communities and the voluntary sector? Working longer could reduce the time available to provide care and support to other generations and to share activities with family and friends. This is particularly relevant to women, who are expected to respond to the needs of others. Studies, in the UK and New Zealand, illustrate the difficulties of juggling caring responsibilities with paid work, and how lack of flexibility in the workplace may lead to withdrawal by older workers. “Family-friendly” workplaces generally focus on the needs of child-rearing employees, but less attention is given to workers in mid-life with eldercare responsibilities. Many people in their fifties and sixties are caring for older family members, reducing demands on the state for eldercare. Then there are the grandparents who take on childcare responsibilities so that their adult children can work and contribute to the household budget.

In an earlier blog I addressed the argument that older people should leave the paid labour force to make way for younger workers. This assumes that the amount of work available is a zero-sum game and that the job market works on a one-in, one-out basis. But most economists now accept that this theory is a fallacy. They conclude that society cannot become more prosperous by paying an increasing number of its citizens to become dependent and unproductive.

Benefits to Business

Almost all the employers interviewed in recent New Zealand research agreed that labour and skill shortages are likely to become more pressing in the near future. Business can benefit from encouraging older people to stay on, capitalising on their wisdom, maturity, experience (life and work), loyalty, commitment and know-how. Older workers provide continuity and can pass institutional knowledge on through coaching and mentoring.

Dis-benefits to business

These may be more perceived than real and often arise from employers’ negative attitudes towards older workers, based on myths and stereotypes which can easily be disproved, such as older workers’ inflexibility, reduced physical ability, enthusiasm and energy and lack of current skills. But these attitudes may be changing. One of my interviewees said: “Instead of older workers being seen as a pain in the butt, employers are beginning to see them as valuable and productive.”

So what do you conclude? Do the pros have it? Or the cons?

Dr Judith A. Davey
Age Concern New Zealand voluntary policy advisor
Senior Research Associate, Institute for Governance and Policy Studies, Victoria University of Wellington

 

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[1] The blogs draw on the findings of my contribution to the research project – Making Active Ageing a Reality – undertaken through the University of Waikato, funded by the Ministry of Business, Innovation and Employment.

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About Age Concern New Zealand 'on research'

At the heart of everything Age Concern does is a passion to see older people experience well-being, respect, dignity, and to be included and valued. We support, inform and advise older people on issues such as access to health care, transport, housing, financial entitlements, and social opportunities. We also work to combat real problems in our society, like elder abuse and neglect, chronic loneliness and social isolation. We provide specialist services with trained and qualified professionals able to give expert advice and assistance. Age Concern is a charity and relies on the support of volunteers and public donations to do much of the work we do. To help us help older people, please consider making a donation of your time or money. To see how, visit www.ageconcern.org.nz
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