More than half of those over 50 who have left their job since the start of the pandemic took early retirement, a greater percentage than the UK average of 49 per cent, according to research from Phoenix Insights.
Research on Scotland’s over-50s’ economic inactivity during the pandemic has been published by Phoenix Insights. According to the data, the number of economically inactive persons in Scotland between the ages of 50 and 64 is at its highest level ever. This is in line with the trend in the UK, where more than 3.5 million adults over 50 are economically inactive.
According to Phoenix Insights, 52 per cent of Scottish workers over 50 who have left their job since the pandemic began cite early retirement as their primary reason for doing so. Only the South West, South East, and East of England have a higher percentage of people who give this reason when compared to the rest of the UK, 57 per cent, 54 per cent, and 55 per cent, respectively.
The data also shows that in Scotland, early workplace departures by people over 50 are frequently caused by illness and disability. Around 19 per cent of this population, or almost one in five, have given up their jobs because of illness or incapacity since the pandemic’s start. This is a little bit more than the 18 per cent average for the UK.
Additionally, over 50s who retire early owing to factors like poor health or childcare duties may experience financial vulnerability because their assets may not be sufficient to cover retirement income requirements. In Scotland, 31 per cent of adults do not have any type of pension. The cost-of-living crises may also be motivating some people in their 50s to hunt for new employment in order to fill any financial shortfalls. The average pension for Scots between the ages of 50 and 64 is £157,500, which is less than what is required for a “moderate” retirement income.
Phoenix Insights director Catherine Foot says: “Economic inactivity across the UK has remained stubbornly high since the coronavirus pandemic, with over 300,000 individuals between 50 – 64 currently out of work and not looking to return5. Across Scotland, a majority of these individuals have taken early retirement, while others have left the workforce due to ill health, job dissatisfaction, or caring responsibilities.
“It’s important not to dismiss economic inactivity among this group as a case of rich baby boomers choosing to enjoy time on the golf course. Stereotypes like this mask real financial and health vulnerability among a group whose successful return to employment is critical to the UK’s productivity and prospects for economic growth, and hugely beneficial to support people’s long-term finances. Around one in three people in Scotland have no pension provision at all, and at current savings rates, many will fall short of a decent standard of living in retirement.
“The UK government announced several measures to encourage over 50s back to work in the Spring Budget, but more targeted action is needed. To enable those in their 50s and 60s to remain in meaningful work for longer, we need to make work more accessible for a wider group of people, with greater flexibility and opportunities to recruit, retrain and retain colleagues.”