Recent labour market data reveals a surge in economic inactivity among workers aged 50-64. As of June to August 2023, an additional 252,000 individuals from this group have exited the workforce compared to figures from the same timeframe in 2019.
The current statistics denote that 3.5 million people in the 50-64 age bracket are economically inactive, a notable rise from 3.2 million during June to August 2019.
There has been a simultaneous increase in the economic inactivity rate, which has ascended from 25.5% to 26.7% within the four-year period.
Economic inactivity traditionally encompasses factors such as early retirement, long-term illness, and familial caregiving.
This recent data has amplified concerns that a considerable portion of older workers are involuntarily stepping into retirement, leading to significant financial and personal repercussions.
In a survey by retirement specialist Just Group, which included over 1,000 retired and semi-retired individuals aged 55 and above, almost half (45%) confirmed they had retired sooner than they had originally planned.
A majority of these respondents attributed this early retirement to circumstances beyond their control.
Delving deeper into the reasons, a third (33%) cited health issues or physical disabilities as the cause for their premature retirement.
Additionally, 15% reported redundancy or the inability to secure a job, while 10% had to retire ahead of schedule to cater to a family member’s care needs.
Stephen Lowe, group communications director at Just Group, provided his insights on the matter: “Today’s figures illustrate that not everyone keeps working until they collect the State Pension. For some people they can choose when they retire but a significant number don’t have that luxury.”
He further added: “Our research demonstrates that nearly half of retirees over the age of 55 are leaving the workforce earlier than expected with many driven out due to factors beyond their control.
“It’s a harsh reminder that people cannot bank on being able to choose the exact point when they retire and in those circumstances a back-up financial plan is extremely valuable.
“It also raises questions about how much help is available for older workers looking to get back to work and whether the government could do more to bring their skills and experience back into the workforce to help drive economic growth.”
