Research Summary Factors affecting the labour market participation of older workers: qualitative research By Pat Irving, Jennifer Steels and Nicola Hall Summary Labour market participation The Department for Work and Pensions (DWP) People in full-time employment covered a wide commissioned ECOTEC Research and range of occupations, while those in part-time Consulting to carry out qualitative research to: work tended to be in administrative and secretarial occupations, personal and customer services • provide an understanding of the relationships and elementary occupations. Typically, people between the different factors that affect in full-time employment had lengthy work people’s retirement decisions; histories, often with the same employer. • explore the factors associated with people Employment histories among part-time workers leaving the labour market prior to reaching and people in elementary occupations tended to state pension age (SPA); be more fragmented, and these two groups moved jobs most frequently. • explore the barriers to continued labour market participation and identify what support people Those in work tended to have partners in work, need in order to remain in work; had qualifications, and generally fewer health problems than those who were not working. That • identify what the Government could do to said, some respondents continued to work enable and encourage people to work for despite acute or chronic health conditions. longer and to promote work opportunities for Reasons why such respondents with health those not actively seeking work; and problems remained in work, were complex and • explore general attitudes towards work and included financial and personal/practical reasons training for people aged 50 to 691. such as a desire for independence from state benefit, a strong work ethic, employer support 71 interviews were conducted with people aged and a perception that their illness was not 50-69 in three fieldwork locations during summer permanent. 2004, and six focus groups were run during November 2004. The respondents included Disengagement from the labour people in or out of work below and above state pension age (SPA)2. market Involuntary (push) and voluntary (pull) factors explained labour market exit for individuals. Push factors included major ‘shocks’ such as 1 The research followed a major quantitative research deterioration in health or redundancy and in study: Factors affecting the labour market participation some cases, they were strong enough as single of older workers (Humphrey et al) published by DWP in factors to cause labour market exit. Push factors 2003. also included reduced job satisfaction, changes 2 Currently 60 for women, 65 for men, rising to 65 for in own role or work itself, caring responsibilities, women between 2010 and 2020. Download this and other research reports free from www.dwp.gov.uk/asd/ recession and industrial restructuring, and Not all respondents had such positive employers’ fixed retirement ages. experiences while trying to remain in work. Views among this group were negative, not only in Financial security was the most important pull terms of how their employer might or did respond factor underpinning all others; those people who to their changing circumstances, but also about could afford to retire had the choice to work or their own contribution to the workplace. Some retire as they saw fit. Financial security, however, respondents felt that they were a burden and so never operated in isolation: it always combined did not think to ask for their needs to be with other push and pull factors. Other pull accommodated. factors included proximity to state pension age, looking after the home and / or spending time A small group of respondents had continued or with family and enjoying quality time and hobbies. wanted to continue working beyond SPA. Some of this group felt that their employers had an A number of key patterns were identified: important role in determining whether they • ill-health operated as a single push factor as continued to work in the future. Others who were well as with other push and pull factors self employed felt that their employment status (typically redundancy, a change in role or work gave them the choice to work or not. itself, reduced job satisfaction, proximity to Most respondents expected to retire at SPA and SPA, financial security or caring); considered that they had earned the right to do • redundancy operated as a single push factor; so. However: with other push factors (ill-health or industrial • some respondents felt that working longer was restructuring); or with one or more pull factors a matter of choice and it should not be (financial security, caring and a desire to enjoy enforced; quality time); • some respondents believed that extending • caring was identified as a push factor or as a working life agenda was a compulsory pull factor. People tended to stop work when extension of SPA. the combination of work and caring became too great, or when their own health or that of the person they were caring for deteriorated. Re-entry Caring typically combined with financial Older people found ways to re-enter the labour security, a desire to enjoy quality time and market after the age of 50 if they were in good hobbies, and looking after the home/spending health, were motivated to do so and had recent time with family. work experience. Irrespective of age, many respondents felt that work was available and Retention and attitudes towards that older workers were employable. Others, extending working lives particularly those who had fixed employment or salary expectations, felt that opportunities were Financial, personal and practical reasons were limited and had failed to find work. key drivers to remaining in work. Some respondents opted for self-employment so that Respondents who were most successful in re- they could continue working. entering the labour market tended to be educated or professionally trained and typically have a Some people’s health problems and caring strong work history, good work ethic and were responsibilities had been taken into account by motivated. Generally, those with lower incomes their employer and they remained in work. Those re-entered through necessity, while those with with positive experiences showed how higher incomes returned through choice. redeployment, opportunities to negotiate flexible working conditions, retraining or a move into Respondents who had been unemployed for self-employment helped to keep people in work. longer found it more difficult to re-enter the labour market. Respondents’ knowledge and understanding of pension plans (because of losses or risks that the labour market was limited: some felt that did not pay off). Others – both planners and non- they should give way and allow young people to planners – felt that they would have to live within take available jobs while others simply felt that their means, and that their lifestyle might have to they were too old to compete for jobs. The change in retirement. mechanisms used by older workers to re-enter the labour market were generally narrow. Those Respondents’ views: what should few respondents who had experienced Jobcentre the government do? Plus services were very disappointed with the support they had received. Respondents raised Respondents saw a role for Government in: the following issues: poor availability of specialist and well-paid vacancies, and eligibility for New • communicating pension information; Deal 50 Plus being too restrictive. • providing a stable and reliable income for people in retirement; Respondents on IB knew little about the types or sources of help and support available for people • regulating the pension environment to protect with a health condition or disability, and did not consumers; want to endanger their benefit status by taking work which they felt they might not sustain. • supporting flexible working practices, Respondents were not aware of the permitted rewarding working longer and enabling choice work rules or benefit protection (linking rules) around when to retire. that would allow them to try work without it Government support to help out-of-work older affecting their entitlement to benefit. people to re-enter the labour market was perhaps the area where respondents had most difficulty Pensions and retirement in making policy suggestions. Many people who were out of work considered that the barriers to Two groups of people emerged from the analysis re-entering the labour market were in terms of their attitudes towards saving and insurmountable, but were unaware of skills gaps planning for retirement: ‘planners’ and ‘non- and shortages in the labour market, available planners’. Planners included people who had support for them or the social and economic consciously organised and planned for their impacts of the ageing population. retirement, while non-planners had not made plans or in some cases had not even considered Recommendations for DWP their future pension situation. • to promote flexible working opportunities for While the concept of ‘planners’ and ‘non- older workers; and work with employers to planners’ helped to explain attitudes towards maximise the take-up of stakeholder and other planning and saving towards retirement, other occupational pension schemes; factors came into play in terms of whether individual or household plans came to fruition. • to provide an effective communications For example, push factors such as ill-health or strategy to underpin Government’s extending redundancy affected people’s retirement plans. working life and informed choice policies. As Similarly, unforeseen caring responsibilities and/ part of this communication, people need to or bereavement caused people to rethink their be better informed about opportunities for work retirement decisions. and the support mechanisms to help people to remain in or return to work. In terms of satisfaction with pension plans, planners were generally more satisfied with their retirement income than non-planners. However, some planners were disappointed with the performance of some occupational and personal Recommendations for The full report of these research findings is Jobcentre Plus published for the Department for Work and • to actively provide general labour market Pensions by Corporate Document Services information and advice on career change and (ISBN 1 84123 880 5. Research Report 281. training to older people on active and inactive September 2005). benefits to help them identify and understand It is available from Paul Noakes at the address available job opportunities. A key challenge below. is how to identify people aged 50 plus on inactive benefits who want to work and are You can also download this report free from: capable of work and help them back into www.dwp.gov.uk/asd/ employment. Other report summaries in the research series Recommendations for the are also available from the website above and Pension Service from: Paul Noakes, Strategic Research and • to raise awareness of its name, and its Modelling Division, 4th Floor, The Adelphi, services, and communicate relevant pensions 1-11 John Adam Street, London WC2N 6HT. to people below SPA, in particular to people E-mail: Paul.Noakes@dwp.gsi.gov.uk who are outside the labour market. Indeed, one option is to provide pension information to individuals via Jobcentre Plus.