Can redundancy be a silver lining?

We hear a lot about the plight of older people who are struggling to get into or return to the workforce. Only recently there was a Stuff headline – “How employers are freezing the over 50s out of the job market”.

The article reported stories about unexpected redundancy and failure to find work even after sending out dozens of applications. The people involved included many who had had successful careers and listed transferable skills. They were frustrated and embarrassed and many did not want to be identified for fear of jeopardising their situation even further.

It would be easy to share these feelings and point to this as proof of “ageism in action”. Redundancy is almost universally portrayed as a negative event. However, about the same time as reading this Stuff article I came across an academic paper – “Ageing and redundancy and the silver lining of entrepreneurship “which threw a different light on the situation.[1]

The authors found that, while redundancy and old age can have negative effects and outcomes, starting up a business enterprise can be something positive for people in later life. They concluded that both age and redundancy may be spurs to entrepreneurship that might ultimately prove positive and contribute in lifestyle terms for older workers: “a silver lining effect”.

“Entrepreneurship can be triggered by events, positive or negative, that shake an individual from their status quo to start a venture” and there are specific appeals of entrepreneurship facilitated and enhanced, not reduced, by older age”.

 Therefore, entrepreneurship may be considered as a reasonable alternative to employment. Redundancy may be a way to secure capital for business if a severance payment is involved. In a different context, I personally know of an example where a person took voluntary redundancy to acquire funds for a house purchase after a matrimonial settlement left him homeless!

As I have pointed out before, there are many advantages for older people starting up their own businesses. Entrepreneurship may be attractive in providing an opportunity to do something for interest, lifestyle and income which was not possible in previous stages of life. Where once income may have been prioritised, other rewards may be gained, such as free time, family time, and new/existing interests.

 All this comes through in some of the stories we were told when we interviewed “senior entrepreneurs” for our current research on workforce ageing. It emerged that many of our interviewees had experienced redundancy from paid work at some stage in their working lives. Many of the older ones, who had reached pension age, agreed that income from their businesses was supplementary for lifestyle rather than basic need.

 Along with the authors of the British paper, we have found a variety of motivators and drivers of entrepreneurship.

• The desire to continue to contribute and apply skills and experience.
• The lifestyle-based attractions of working for oneself, flexibility, being one’s own boss. independence, freedom, satisfaction and growth.
• The opportunity to fulfil other roles too – such as caring for older relatives

From the British study the conclusion was –

“Entrepreneurship was perceived as an opportunity, but this opportunity was less about being an entrepreneur and more about the lifestyle advantages perceived of independent business in the context of older age and circumstances.”

We are thinking about this in the context of our research – would we agree that “redundancy a blessing in disguise?” Perhaps for some.

 

 

[1] Rebecca Jane Stirzaker and Laura Galloway (2017) Ageing and redundancy and the silver lining of entrepreneurship. The International Journal of Entrepreneurship and Innovation, Vol. 18(2) 105–114.