Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
Quick links:
  • Home
  • The Actuary Issues
  • August 2013
08

Fewer people retiring early due to pension changes

Open-access content 4th September 2013

The growth of defined contribution pension schemes has made early retirement less attractive in the UK, giving it one of the EU’s higher rates of employment of older people, a report by the International longevity Centre has found.

It said 58.4% of older workers aged between 55 and 64 were in work, against 48.4% across the European Union.

'Unlike some other member states, the UK does not have the same culture of early retirement, and research has suggested that employers are aware of the need to utilise an older workforce in the not-too-distant future,' the Working Longer: An EU Perspective report said.

Private pensions are more common in the UK than elsewhere, and the move in that market from defined benefit to defined contribution schemes 'has reduced both the incentive and ability of people to retire earlier', the report stated.

The centre said the government should therefore put extra resources into tackling ageism and creating jobs for an older workforce.

Europe faces a significant skills gap due to demographic change, it said, with the UK alone expected to have 13.5m job vacancies over the next 10 years, but only 7m young people to fill them.

EU governments had collectively missed a target set in 2001 to achieve a 50% employment rate of older workers by 2010, with only 48.8% of this group in work in 2012.

Between 2002 and 2008, the average age at which workers left the labour market increased only from 60.1 to 61.4 across the EU.

One barrier was that the current cohort of older workers in Europe has low levels of education and qualifications compared to younger groups, the report found.

Employment rates for older workers varied considerably, from 77% in Sweden to only 13% in Hungary.

ILC-UK assistant director of policy and communications David Sinclair said: 'As our society ages, it will be increasingly important to make the most of the potential of older workers. Yet few European governments have got to grips with the challenges of an older workforce.

'Flexible working and opportunities for people of all ages to develop their skills are vital. We must tackle ageism whilst also offering older people the opportunity to retire gradually.'

Hymans Robertson partner Andrew Gaches said: 'The reforms currently going through parliament [in the UK] will mean that state pension age is in part decided by increases in life expectancy across society.

'While increasing state pension age may act as incentive to continue working, there are no guarantees older workers will choose to do so. People will only continue to work if they are healthy enough to do so and policy makers need to consider the issue of healthy life expectancy.'

This article appeared in our August 2013 issue of The Actuary.
Click here to view this issue
Filed in:
08
Topics:
Pensions
Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Senior Pricing Actuary

London (Central)
£95000 - £120000 per annum + benefits
Reference
118966

Senior Longevity Actuary – Reinsurance

London (Central)
£100,000
Reference
118949

Senior Capital Actuary

London (Central)
£90000 - £110000 per annum + + bonus + benefits
Reference
118965
See all jobs »
 
 
 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2020 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited, Level 5, 78 Chamber Street, London, E1 8BL. Tel: 020 7880 6200