The Daily Telegraph - Saturday - Money
Generation cast out: over-50s now face ruin
Older workers are being pushed out of jobs and into retirement, forcing them to use their pensions to get by. Jessica Beard reports
‘Firms make older people’s lives hard. Age discrimination is absolutely rife’
Jenny Chapman, 61, a retired teacher
Hundreds of thousands of midlifers have been pushed out of their jobs and face poverty in retirement in what has been called a “national scandal” as they are forced to spend their pension savings sooner than they had planned.
Unemployment among the over-50s has rocketed and caused a nationwide brain drain. Redundancies have been higher among older workers than in other age groups since the pandemic began – more than 550,000 “silver workers” have left employment, official figures have shown.
Those over the age of 50 find it the most difficult to return to work. Two in five unemployed over-50s remain out of work for more than a year.
Many older workers have had to dip into pensions to get by. There was a 20pc increase in the amount of money taken out of savings pots between April and December last year compared with the same period in 2020, figures from the Office for Budget Responsibility showed. The taxman expects to receive £800m more every year as a result of retirement money being spent earlier than planned.
Chris Brooks of Age UK, a charity, said it was a “national scandal” that so many had been forced out of work. “People are leaving because they were pushed out and the Government isn’t doing enough to prevent it,” he said.
The £ 800m in extra tax revenue may discourage government action. Mr Brooks said the problem had “gone under the radar for so long and urgently needs addressing”.
“A lifetime of experience is so valuable for businesses,” he added.
Someone who earned £50,000, was made redundant at 55 and forced to retire would be £ 965,000 worse off than if they stopped working at the state pension age, calculations by AJ Bell, the stockbroker, found. They would lose £405,000 alone from missing out on pension contributions and investment returns over the period.
Stuart Lewis of Rest Less, an online community for over-50s, said: “The mass exodus of mid-lifers is in full swing. There are thousands who have given up and left the workforce involuntarily after struggling for months or years to find their next job. They feel shut out and left behind. This is happening while we live through one of the worst cost of living crises in decades.”
Deborah Lewis, 60, from Wigan, has been unemployed since May last year and has been forced to dip into her pension even though she is not ready to retire. She has repeatedly applied for relevant jobs but has not even been shortlisted, she said. “I lost a lot of confidence and started to question my own abilities. It’s really disheartening. It’s horrifying that I’ve been out of a job for 10 months. I’ve always secured a role very quickly in the past but now I’m not even getting an interview,” she added.
Rising prices of energy, food and fuel have left Ms Lewis with no choice but to spend her pension. “It feels like I’m being pushed into retirement. I still have so much to offer. I’m not ready to retire,” she said. “My pension may seem like an easy solution, but I don’t have a partner and it needs to last.”
Only one in five of those over the age of 55 who still wants to work is confident they will be able to find paid employment, research from Just Group, a pensions firm, found.
Jenny Chapman, 61, from London, said she lost her position at work, which gave her little choice but to retire last September.
The former teacher said she was squeezed out of her senior role into a lower paid job that would have affected her final salary pension had she taken it. “It was because I was an older woman. I have seen time and time again through friends and family that businesses make older people’s lives difficult. Age discrimination is absolutely rife,” she said.
Since she left that job Ms Chapman has had to supplement her income by tutoring. She also gives financial support to her two children, who are at university. “When my children applied for university I assumed I would still be working for years to come,” she said.
Cheryl Prax, 67, from London, was made redundant at 61 and resigned herself to spending her pension after years of applying for jobs. Ms Prax, who was an office property manager, said she sent 30 applications a week for 18 months but received no offers of employment.
“I gave up in the end even though I didn’t plan to retire until 67. At the start I didn’t apply for anything below my ability but I soon had to,” she said.
Ms Prax said she felt she had experienced age discrimination at first hand. “At one interview the employer said: ‘ We didn’t realise you were that old.’ I was only 51 at the time,” she added.