Keep on working after 65 – but where?

Keep on working after 65 – but where?

The need for a higher retirement age appears to be irrefutable. In Australia the over-60s are growing in number at approximately four times the rate of other demographic groups. At current trends, by 2050 there will only be 2.7 working Australians for every citizen over 65. In the 1970s, the ratio was 7.5 workers for each older Australian*.

We can’t just ignore the fact that there’s a lot less money to meet a much higher demand. But I don’t understand why anyone would think that raising the retirement age to 70 or even higher will even begin to solve the problem.

For decades, people over the age of 50 have struggled to find work. As a Senior-level NSW Executive Recruiter points out in the survey I’ve quoted above, “In Australian business, the fact is that your chances of landing a permanent job are MUCH reduced in your 50s and 60s, when competing with people in their 30s and 40s…” The same survey also found that older people are generally the first to go when a company is ‘downsizing’.

Many young bosses prefer working with people ‘like them’, which means the same age or younger. They might find it hard to manage people who are significantly older than they are. And they could find it difficult to justify spending money on training someone in his or her late 60s rather than someone 30 years younger. Yet, as technology continues to play a more strategic role in just about every workplace, it’s the people who didn’t grow up with computers who need training just to keep up.

There’s also the matter of health. Of course there are growing numbers of people in their 60s and well beyond who are fit, well and have much to offer. But, statistically, people over 65 are a lot more likely to need time off for doctors’ appointments and general illness. The National Bureau of Economic Research reiterates the obvious – it’s a fact of life that health declines with age. The biggest risk factor for chronic illnesses such as cancer, diabetes and heart disease is getting older. And, interestingly, health declines much more rapidly during the working years for those at the bottom of the income distribution than for those at the top. Which is not good news for people who face extra years of working in low-paid jobs that involve hard physical labour, such as cleaners and aged-care workers.

At the same time, according to an analysis of the latest official figures from the Australian Bureau of Statistics by the Brotherhood of St Laurence, youth unemployment has now reached crisis point in Australia.

So who is going to employ all of these over 65s? Where are all the jobs going to come from? Aren’t we simply giving the aged pension a different name – unemployment benefit?

*Attitudes to older workers Prepared by Westfield Wright for the Financial Services Council, January, 2012