1. Humber LEP 50+Conference Fuller Working Lives 20 November 2015 Lis Robinson – Head of Work and Wellbeing in Later Life

2. 2 Department for Work & Pensions The Ageing Workforce : Why it matters Demographic change We’re living longer So the make up of our workforce is changing Over the decade to 2024 the number of people aged 50 to State Pension age will rise by 3.2m and there will be 200,000 fewer 16-49 In the next 10 years in the Humber region, there will be 2% fewer 15-49 year olds but 7% more people aged 50-64

3. 3 Department for Work & Pensions Good News There are more older people in employment than ever before: 9.5 million 50+ workers in the UK The corresponding employment rate for people below 50 has been broadly constant Attitudes may be changing? Recent polling said: Over 75% employers believe 50+ workers are a benefit, 65% highlighting reliability and 54% their role as mentors to younger employees. 87% disagreed that skills of older workers are not suitable for their business And people want to work longer? ½ respondents over 50 still want to be working between 65-70 39% would prefer winding down gradually with part-time work, rather than retiring Only 15% of non-retired over-50s said they would like to stop working altogether between 60-65 1/5 retirees wish they had worked longer, 38% of them because they miss the social interaction

4. 4 Department for Work & Pensions So what’s the issue? Despite the fact that we’re living longer, on average men and women still leave the labour market earlier now than they did in the 1950s. In 1950s the average exit age for men was over 67 and for women just under 64; Currently men retire at 64.8 years and women at 63.1 years. Leaving the market early has significant impact for the economy, for business and individuals

5. 5 Department for Work & Pensions Falling out of the workforce early is a significant issue

6. 6 Department for Work & Pensions The economic cost– GDP implications This could mean around £164 million in gross value added for Humber LEP.

7. 7 Department for Work & Pensions The Cost to Business The premature loss of older workers can lead to: Skills shortages Loss of knowledge and experience Lost opportunity for mentoring of younger employees. Higher recruitment costs Increased staff turnover - higher training costs and loss of output There is no systematic evidence that older workers are less productive than younger workers There is no evidence that increasing the employment of older people displaces younger people from the workplace – the reverse is true

8. 8 Department for Work & Pensions The Cost to Individuals

9. 9 Department for Work & Pensions In 2013 2.9m people o/50 left work early triggered by a life event: 1.0m (34%) Health condition or disability 0.4m (14%) Caring responsibilities 0.7m (24%) Retired 0.4m (14%) Unemployed - workplace factors, redundancy and Half of economically inactive older men and two thirds of women previously worked in one of four sectors: –Men – manufacturing, construction, transport, wholesale/retail –Women – education, health/social care, public administration, wholesale/retail The major factors that lead people to leave the workforce early

10. 10 Department for Work & Pensions Fiscal implications Leaving the labour market early increases the likelihood of claiming income-related benefits in retirement There are 2.9 million people out of work aged between 50 and State Pension age - of which, only 0.7 million see themselves as retired, yet 1.7 million think it is unlikely that they will ever work again Around £7 billion per year is currently spent on the main out-of- work benefits for people aged 50 to State Pension age

11. 11 Department for Work & Pensions The Local Picture Employment rates for 50-64 year olds are lower than those for 25-49 year olds across England – this is also evident in the Humber LEP area. Employment Rates across LEPs in Yorkshire and The Humber

12. 12 Department for Work & Pensions National Comparison As a percentage, the workless population is greater than the total population for 50-64 year olds across the region

13. 13 Department for Work & Pensions International Employment Comparison The UK’s 55-64 employment rate is just above the middle compared to other OECD nations at 61% however there is clear room for improvement to reach the employment rates achieved by the likes of Norway, Sweden, Switzerland and New Zealand who all achieve employment rates of above 70 per cent

14. 14 Department for Work & Pensions Government Response - Legislative Legislation to bring about the right conditions for change: Abolished the default retirement age –meaning people can choose when to retire Extended the right to request flexible working to all employees from 2014 State Pension age reform (currently rising to 67 by 2028) Introduced Pension flexibilities

15. 15 Department for Work & Pensions Government Response – influencing and supporting Promoting culture change Published Fuller Working Lives: a Framework for Action Business Champion for Older Workers report ‘A new vision for older workers: retain retrain recruit’. Focus on:  Retain - keeping older workers and their skills in the workplace…  Retrain - ongoing workplace training irrespective of age…  Recruit – stamp out age discrimination from the recruitment process” Back to Work Support Improved back to work support for older workers (Jobcentre Plus Older claimant champions) Increased trials and pilots: e.g. supporting carers in employment

16. 16 Department for Work & Pensions Toolkit guidance for managers of an ageing workforce DWP has been working with individual sectors to ensure employers have the guidance they need to support the on-going productivity of older workers and to adopt flexible approaches to work and retirement

17. 17 Department for Work & Pensions A new employer-led strategy Government intends to publish a new employer-led strategy to take forward the Fuller Working Lives agenda It will respond to and develop the recommendations made in the Business Champion report, Update the business case, and Engage the expertise of a range of organisations and employers to produce effective solutions We’d welcome your involvement

18. 18 Department for Work & Pensions FWL Business Strategy Group To support development of a new strategy, a working group of employers has been set up to drive tangible change that improves the retention, retraining and recruitment of people aged 50+ Six employer-led task and finish groups have been set up to look at:  Age Discrimination in recruitment  Skills  Managing an ageing workforce  Financial wellness  Health Management  Innovation

19. 19 Department for Work & Pensions What employers say Shell - Oil industry - Valuing Experience The right staff with the right skills at the right time is critical. Experienced workers have a huge amount of expertise. They may end up working for a competitor. The Co-operative Group (Co-Op) - Retail - Positively Changing Policy Employment decisions should be based on competencies, qualifications, skills and potential rather than chronological age. Co-op removed their contractual retirement age altogether in 2006. A Group-wide communications campaign and age positive awareness training for managers supported the process. Employees who choose to continue working are able to continue in the Group’s pension scheme, and draw on their pension whilst continuing to work for the Group. Co-op currently has 1,957 valued employees over the age of 65.

20. 20 Department for Work & Pensions JD Wetherspoon - Bar Industry – Reliable and Committed Feedback suggests older staff are particularly stable, with low absence, a strong work ethic and a commitment to the business. They are welcomed, from part-time bar work to managerial posts. Training available for older employees to progress to manager level. Turnover of pub managers at Wetherspoon is half that of the industry average. B&Q - DIY retailer - Offering Adjustments to Retain Workers. 28% of our 32,000 workforce are over 50, and many employees semiretired. Our oldest employee is 96 Recognise ageing population comes with some physical restrictions, e.g. injuries, bad backs and people becoming more frail, so they offer adjustments to utilise these people as well as it can.

21. 21 Department for Work & Pensions What it means to individuals Linda Britton (57) – Flexible Working Makes parts for the car industry. Her normal shift is 2pm to 10pm. Sometimes needs time off at short notice to provide emergency childcare for her grandchildren. Employer lets her change her hours, and make up the time later. A flexible employer is a reason why she stays.