June flash employment indices shows over 50s still most likely to be in long term unemployment

Thursday 12 June 2014

Saga's flash employment indicis for June shows that the number of over 50s in work continues to grow, as does their overall share of employment. However, there continues to be a more worrying picture for those that lose their job at an older age as they find it significantly harder likely to get back into work.

June flash employment indices shows over 50s still most likely to be in long term unemployment

Saga Flash Employment indices – June 2014 bulletin

Key points:

 The UK-wide unemployment rate (for persons aged 16 and over) during February– April 2014 was 6.6%, down 1.2 percentage points on a year earlier.

  • Figure 1 illustrates that the contribution of the over 50s to the job market has been steadily rising. The total number of workers in the UK grew by 5.5% between the start of this Parliament in May 2010 and February – April 2014, with employment for the over 50s rising faster than for younger workers. Over this time, the number of workers aged:
    • 65 or older has risen from 800,000 in three months to May 2010 to 1.098 million over February – April 2014, a very pronounced rise of 37.3% or 298,000 employees.
    • 50-64 has risen from 7.289 million in May 2010 to 7.930 million over February – April 2014, an increase of 8.8% or 641,000 employees.
    • 16-49 has increased by 3.2% or 666,000 employees, from 20.841 million to 21.507 million.  
  • The number of workers who are 50 or older has been rising steadily. At the start of the current Parliament in May 2010 some 8.089 million UK workers were 50 or older. That figure had risen to 9.028 million over the three months to April 2014.
  • Figure 2 illustrates the over 50s’ share of UK employment is continuing to rise. Over the three months to April 2014, we calculate that:
    • 70.4% of all employed people were 49 or younger, down from 71.0% one year previously.
    • 26.0% of all employed people were in the 50-64 age bracket, up from 25.6% one year earlier.
    • 3.6% of all employed people were 65 or older, up from 3.4% 12 months before.
  • Employment is not a zero-sum game and the over 50s have not been squeezing young people out of the job market. The number of employed over 50s is far lower than the number of employed 16-49-year-olds. Over February – April 2014, there were 7.930 million employed 50-64-year-olds, versus 7.628 million one year earlier. This compares to 21.507 million employed 16-49-year-olds over February – April 2014, versus 21.125 million over the same period in 2013.
  • Figure 3 shows that economic activity[1] amongst 50-64-year-olds has been gradually trending upward compared to economic activity amongst 18-24-year-olds. The economic activity rate amongst 50-64-year-olds is now similar to that of 18-24-year-olds. Over the three months to April 2014, we calculate that:
    • 71.5% of 50-64-year-olds were economically active.
    • This was just below the 71.7% economic activity rate of people aged 18-24.
    • 86.1% of those in the 25-34 age bracket were economically active.
    • 86.7% of those in the 35-49 age bracket were economically active.
  • Figure 4 presents a more troubling finding, suggesting that if older workers become unemployed, they are more likely to get trapped in long-term unemployment than their younger colleagues: [2]
    • The number of long-term unemployed people aged 49 or younger stood at 2.101 million over the three months to May 2010, the start of the current Parliament – falling to the 1.794 million figure recorded over the three months to April 2014. This represents a 14.6% decline in the number of long-term unemployed persons in this 49 or younger age bracket.
    • By contrast, from the start of the current Parliament to February– April 2014 the number of long-term unemployed people in the 50-64 age bracket has fallen only marginally, from 367,300 to 342,654. This represents a more modest 6.7% decline in the number of long-term unemployed persons in this age bracket.
  • At first glance, this paints an uplifting picture of over 50s’ lot in a labour market which has begun to build up steam as the UK economy is accelerating. This data suggests that businesses have turned to older workers – perhaps valuing their skills, experience and conscientious attitudes.
  • However, on closer inspection, the data gives more cause for concern. Many over 50s may have chosen to continue working, postponing retirement, not because they wanted to, but because economic necessity forced them to. Falling living standards – caused by low interest rates, subdued pension returns and elevated utility price inflation – may have forced thousands of over 50s to retire later or come out of retirement.[3]

Full report and graphs available

[1] A person is classified as economically inactive if they are unemployed and not looking for work. This definition will include: (i) retirees; (ii) all people aged below 16; and (iii) all school, college and university students who are no engaged in part-time/full-time work and who are not looking for such work.

[2] A person is defined as being long term unemployed if they are unemployed for one year or more.

[3] See: Gustman, Steinmeier and Tabatabai (2010); Goda, Shoven and Slavov (2010) and Banks, Crawford, Crossley, Emmerson (2012).

Share this page

Get In Touch

The Saga Group Communications Team only deal with enquiries from the media.

If you're not a journalist, visit our contact us page for a full list of telephone numbers.