Two thirds (66%) of employees surveyed believe they will work past the age of 65, according to new research from Canada Life Group Insurance. This has almost doubled since October 2012, when only 35% believed they would work past the traditional retirement age.
Almost one in four (24%) employees say that they will have no choice but to work beyond 65 because of the recession, while an additional 31% were already considering working beyond the age of 65 but are now likely to have no alternative. With annual pay rises being dwarfed by inflation according to ONS dataii, causing many to dip into their savings, it is unsurprising many feel they cannot afford to retire at the traditional age of 65.
With the removal of compulsory retirement ages, it is easier for people to continue to work beyond age 65 and ONS statistics show that there are already one million over-65s in the workplaceiii.
Poor pension provision leads to older workforce
Almost two thirds (65%) of employees say the rising cost of living means they will need to supplement their pension with a wage: this far out-weighs the proportion who wish to continue working beyond the age of 65 because they enjoy their job (28%).
Almost two-thirds (63%) believe they will not have a sufficient pension by the age of 65, while one in ten (10%) will continue working past the traditional retirement age to continue receiving valuable employee benefits.
Health concerns and career-blocking side-effects of an ageing workforce
Among employees planning to work beyond the age of 65, 18% believe that critical illness cover would be the most useful employee benefit. This is unsurprising given that almost a fifth (20%) say the issue that will most affect employees due to the ageing workforce is a change in working dynamic as older people have more health issues. An additional 16% believe income protection would be most useful.
Almost a quarter of employees (24%) believe that older workers will have to re-train or learn new skills to stay in work, while over four in ten (41%) respondents suggest it will be harder for younger people to move up the career ladder as a result of an ageing workforce. The 21-30 age group (50%) are most likely to say this, suggesting many younger workers have already experienced difficulty in advancing their careers as a result of fewer workers taking retirement aged 65.
Paul Avis, Marketing Director of Canada Life Group, comments:
“The concept of retiring at 65 and no longer earning a wage is fast becoming antiquated, as more and more employees accept they will be working long beyond the traditional retirement age. Increased life expectancies and recent economic difficulties have boosted the proportion who feel they will be forced into working longer than they want to in order to afford the rising cost of living.
“Employees considering working beyond the traditional retirement age should acknowledge the importance of appropriate workplace benefits, particularly as an older workforce will inevitably suffer from more health issues. Group benefits such as income protection and critical illness cover will ensure incomes are protected in the event of an accident or serious illness, preventing people from having to push back their retirement even further due to unexpected gaps in income.”
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