State pension age increase causing huge uncertainty for older workers, especially females
The alignment of state pension ages for women and men—while in some senses a milestone for gender equality—has created very real difficulties for those whose who will now not receive their State Pension when they had originally expected to.
As a result many older workers, particularly women, are living increasingly precarious lives because they are being forced to remain working in physically demanding and sometimes insecure jobs, new research has found.
Researchers from the University of Kent, Newcastle University and University of Edinburgh, in a wider study of extending working lives sought to understand how rises in the State Pension age to as high as 67 for those born between 1953 and 1956 are affecting people's lives, both in terms of work but also their personal lives.
Part of the research involved interviews with 59 employees aged 50 and over from a local government organisation (37 workers interviewed) and a hospitality organisation (22 interviewed). The sample group comprised both men and women in blue-collar, white-collar and managerial positions.
They found that, contrary to some views that abolition of mandatory retirement ages and changes in pension provisions are giving workers more freedom to manage retirement flexibly, there are many workers that are unable to stop working, even when in ill-health, due to State Pension age changes.
Not only this, many of those interviewed were worried by the precariousness of their jobs and the risk of restructuring (and being paid less as a result) or redundancy, as they are reliant on this income to provide for them now the state pension age has been raised. This is further exacerbated by many feeling that at their age they would be unlikely to find new forms of employment, thus making their current job their only viable source of income.
For workers in the hospitality organisation, there was also the issue of how physically demanding the work is, often causing ill health. This makes the prospect of working for several more years before receiving a pension unrealistic, despite no other options being available to them.
One interviewee said: 'I can't see me physically and mentally being able to do this job, you know, at those ages they're talking about. I think it's 66 for me ... I mean, that's ridiculous. I really cannot see me being able to cope with all the workloads, not in this job.'
Furthermore, many women interviewed were in poor financial situations because they had got divorced and failed to secure much financial support from this process. Prior to this, they had expected to rely, in part, on their husband's pension. However, after the divorce they had to go back to work with no option of early retirement.
Many of these women are also living in rented accommodation now or paying a mortgage and so have no buffer in the form of equity in a home or the ability to downsize and increase their incomes.
Conversely, though, both women and men who were married and/or owned a house outright or were close to paying off their mortgage were able to use this as a buffer against a precarious job or the rising state pension age, giving them some degree of freedom over their retirement options.
Professor Sarah Vickerstaff from the University of Kent's School of Social Policy, Sociology and Social Research said: 'It is clear there is are huge numbers of UK workers living precarious lives. They are many years away from receiving a pension they were otherwise expecting to draw at 60 and they are often working in physically demanding or very insecure jobs. Furthermore, with many female workers often unable to rely on a second income from husbands, who often have better pension provisions, there is little option for them but to keep working, even if the work is causing them health problems.'
The researchers argue that the risk of State Pension ages rising further still, perhaps to as high as 70, is unrealistic and will cause even more hardships for large numbers of the population and will have a detrimental effect in many ways on UK society. State-provided financial support mechanisms are required to enable people to exercise greater control over the timing of the end of their working lives this means allowing people who cannot carry on working to take a State Pension at age 65.
The findings have been published in a paper entitled Understanding older worker precarity: the intersecting domains of jobs, households and the welfare state in the journal Ageing and Society. The paper was co-authored by Dr. David Lain, Newcastle University Business School, Professor Wendy Loretto, University of Edinburgh Business School and Dr. Laura Airey, University of Edinburgh Business School.