At the Employers Forum on Age (EFA), we have long been championing the benefits of working past 65 and while the real health rewards of working longer have now been scientifically proven, there is also a financial imperative to working beyond 65 which is of equal importance.
Retirement age is an issue that affects us all. The fiscal reality is that the UK economy can no longer afford a culture of early retirement. Most of us will have more than a third of our lives left at pension age; such changing life patterns mean we are still juggling mortgage commitments and education costs in our sixties.
There is also a strong economic urgency to stop forced retirement, since, on top of the current recession the UK is now facing a very real pensions crisis. In 2008 the tipping point was reached and there are now more people in Britain over 65 than under 16. With fewer young people coming into the workplace and a greater number of older people needing pension payments, the sums just don't add up anymore. Removing barriers to longer working life will prove to be good for the individual, good for the economy and good for business.
The rise in the number of people expecting retirement to be a matter of individual choice, not a decision imposed on them, means employers are taking notice and thinking how to respond to this shift. Despite fears that losing the default retirement age will bring problems around managing the end of working life and workforce planning, many businesses are waking up to the fact that older workers are a valuable asset.
EFA members who already operate without a retirement age report that engaging with older workers and motivating them to stay in the workplace actually helps fill skills gaps and provides them with a more diverse workforce; one that better connects with their customer base.
There is no evidence that suggests age directly affects performance. Staff at all ages need good management and relevant training opportunities. Physical capabilities do change as we age, and some physical jobs may become harder. But with the right management, an older worker who doesn't want to retire can become a valuable asset in a different role as knowledge, skills and experience are retained within the organisation. And in light of this week's research, keeping that knowledge and those skills alive can have enormous benefits to the individual, that no-one would want to be denied.
Enlightened employers, ironically including all central Government departments, are developing policies which allow employees to continue working for as long as they wish, and are able, to do the job. In practice well-designed and effective performance management systems will put to rest most concerns about operating without a Default Retirement Age (DRA).
Removing the DRA signifies a major shift in the way many organisations run their businesses, but the shift brings big positives to the employer as well as the employee. Flexibility around retirement age is an exciting opportunity, a combination of more flexibility in the workplace and less rigid working expectations means that many people are now enjoying the reality of pursuing several careers over a lifetime. Removing the DRA will not force people to work to their dying day, but will give the individual choice about when they retire.
We have highlighted this issue to the Government and have asked them to commit now to ending the DRA in 2011, thereby giving employers the necessary time to prepare for the changes.
Denise Keating is chief executive at the Employers Forum on Age
