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The Weekly paper of the New Communist Party of Britain

Not Always a Rosy Retirement

by New Worker correspondent

Last week the Trades Union Congress produced a short report entitled 'Creating a Healthy Labour Market', with a more helpful subtitle of 'Tackling the root causes of growing economic inactivity among older people'. Like many TUC reports it is a very mixed bag. It makes some useful points and recommendations, some of which are rather bland.

The report opens by noting that in recent years the number of people in the UK who are economically inactive has risen considerably, pointing out that there are now 440,000 more people of working age who are neither in work nor looking for work than there were three years ago when we still thought corona was a brand of beer.

These are generally older people, a fact which has led some to suggest that many people have decided voluntarily to take early retirement, cheerfully, or not, accepting a reduced income in exchange for more leisure time.

This, the TUC claims, is not the case. Instead, it a reveals that ill-health is the problem, with 2.5 million out of work due to long-term ill-health. This is an increase of 340,000 since 2019, with 1.5 million over 50 years of age (hereafter referred to as older workers). In all, over one-quarter (3.5 million people) aged 50–64 are currently economically inactive.

These are generally people in low-paying jobs. Two-thirds of inactive older workers had previously been in jobs in the five lowest-paid occupations, which account for four in 10 (40 per cent of) jobs.

This is confirmed by {Pensions Age}, the trade journal for the pensions business, which reports that over-50s in Britain who have been driven out of work for health reasons have a mere five per cent of the wealth of those who took early retirement by choice.

Whilst those who chose to retire have an average wealth of £1.24 million (which sounds a lot but includes houses and private pensions), for those who are out of work for ill health reasons the average wealth is only £57,000, slightly better-off at £137,000 are those who left work to look after family.

Wealth differences suggest older workers who are economically inactive due to illness or caring responsibilities are financially vulnerable, the report highlighted, and at current savings levels are unlikely to be to be able to afford a “moderate” standard of living in retirement.

Many older workers have left work early to take on caring responsibilities, particularly of elderly parents, a disproportionate number are unsurprisingly female workers.

The Tory Chancellor thinks that getting older workers back in work is essential “to harness the full potential of our country” and to “fix our productivity puzzle”, by which he means workers are not working hard enough.

The TUC welcome these pieties because assisting those older workers able and willing to work improves their material living standards and would improve mental and physical health.

It points out that to achieve the Chancellor’s objectives, a great deal needs to be done. The first priority is restoring the NHS by dealing with the recruitment and retention crisis to tackle the waiting list crisis, which is vital.

Instead of trying to force older workers back to work with benefit sanctions or increasing the state pension age, there must be good quality jobs, with flexibility to meet health conditions or juggling caring responsibilities.

More training is needed to allow older workers to keep their skills up to date or to reskill for new roles to increase their ability to remain in employment.

For those who are in fact too sick to work the TUC demands that the “safety net needs to strengthened to prevent this resulting in severe hardship, and levels of workplace pension saving must be increased to give more people the financial resources to have control over how and when they stop paid work”.

The TUC points out that it is vital to deal with the NHS funding and recruitment crises. It notes that there is a waiting list of 7.2 million people, many of whom will be prevented from working for precisely those reasons. At the same time NHS England alone is short of almost 133,000 staff due to unfilled vacancies, with a vacancy rate of just under 10 per cent, due to staff fleeing to become shelf-stackers in Tesco. In social care it is even worse, with a shortage of 165,000 jobs. This is related to the fact that UK health spending is 18 per cent below the average in Europe.