We must not pension off our older workers
Making way for young jobless is a mistake, says minister
ROUTINELY pensioning off older workers to make way for unemployed youngsters would hurt the economy, a minister claimed yesterday.
Employees in their sixties tended to be more experienced, more productive and took less time off sick than younger staff, said pensions minister Steve Webb.
Ushering them into retirement early would be a mistake because jobless youngsters cannot simply ‘slot in’ to their vacant posts.
‘This is not the battle of generations,’ he said during a debate in Westminster yesterday. The Liberal Democrat was answering a question from Ulster MP Jim Shannon, who said that keeping people working for longer meant youngsters could not get a job. But Mr Webb said youngsters with no work experience were no substitute for mature employees who still had plenty to offer Britain’s workforce.
‘Older workers on average are very productive,’ he said. ‘If you pension off older workers early, the economy as a whole suffers.’
He added: ‘Often older workers are more experienced and highly productive. They take less time off sick.’ Previous efforts to reduce youth unemployment by retiring workers early have had no major impact, claimed Mr Webb.
Early in 1977, the Labour government introduced a ‘work release scheme’ to encourage those aged 59 to retire.
The measure was then extended to over-60s men in 1983 by a Conservative government with the aim of taking tens of thousands off the dole queue, but the move made no difference to the figures, said Mr Webb. ‘All it did was stick lots of men in their early 60s on benefit,’ he said. ‘It did nothing for youth unemployment.’
Mr Webb said studies showed there is ‘ no evidence that the younger workforce benefits if you pension off older workers’. He cited a study by the respected Institute For Fiscal Studies, which showed that there was ‘no evidence of longterm crowding-out of younger individuals’ by the over-50s.
Surveys by charities often showed that older workers face discrimination by employers who fear they
‘Faster at complex tasks’
will be slower and take more time off to recover from illness. But a study for the charity Age UK by the University of Essex revealed that older workers showed ‘little sign of a decline in overall productivity because older workers compensated with skills and experience’.
The report concluded that ‘while bottom line speed may deteriorate, overall efficacy offsets any impact to productivity’.
‘Younger people might be typically faster at carrying out repetitive tasks [but], in comparison older people are often faster at carrying out complex tasks that allow them to draw on their contextual knowledge and years of work experience,’ the research concluded. A separate study of German workers at a Mercedes Benz car plant found that older workers were more productive and less prone to errors than their younger counterparts.
Car maker BMW also set up a production line staffed only by older employees and found productivity went up 7 per cent in the first year.
The study also found that older people took f ewer short- term absences. But when they were absent on sick leave, it was for longer. Similarly, older people were found to have fewer but more serious accidents at work.
Researchers discovered that mature staff were motivated and as willing to work as f l exibly as younger workers.
Ros Altmann, a former adviser to the Treasury, said: ‘Keeping people in the workforce for as long as possible is good for the economy.
‘Once an older person loses their job, it can be nearly impossible for them to find a new one.
‘Yet all the evidence shows that older people are more productive, more loyal and have more useful experience in the workforce than younger people.’ She said ministers should be doing more to encourage older workers to stay on – at least in part-time roles – and even to retrain if necessary.