HOW OLDER WORKERS WHO REFUSE TO RETIRE ARE STOPPING THE YOUNG FROM GETTING STARTED
Changes to the default retirement age will block even more young people from entering the labour market, a new survey suggests. Bosses say that new Government rules, which come into force in October, will mean they no can longer get rid of their older workers at the top of the career ladder – so will have less money to hire new, young staff at the bottom. Experts predict the impact on the youth jobs market could be “profound.”
Previously, employers could force a worker to quit their job at the age of 65 – but from next month older workers will be free to stay in their jobs for as long as they like, possibly into their 70s and 80s. While this is good news for them, a new study suggests that their refusal to leave the workforce will block younger workers from entering: 22% of employers said that the biggest practical impact of the change would be having “less capacity to take on younger members of staff.”
In many sectors, senior employees command salaries of well over £100,000. This amount would fund four graduate roles at the same organisation. No wonder 46% of employers predicted the change will have a negative impact on their business.
Paul Griffin, head of employment at law firm Norton Rose, which commissioned the study, said:
“Scrapping the default retirement age was a bold move although to some extent inevitable. There’s no doubt that workers have a significant amount to offer their employers after the age of 65, but the knock-on impact on employers’ capacity to take on younger talent could be profound. It’s an issue many feared would be sparked by the change – this survey confirms that it’s very much a reality.”
The number of older workers has already ballooned, with many forced to keep on working due to a lack of decent pension or any other savings. It is expected to keep on rising, particularly as the baby boom generation (born after the Second World War) are starting to reach 65, and opt to keep on working.
And there are also fears that this change could impact graduates already in jobs, too. By refusing to leave the workforce, older employees will stop those below them from being promoted, which will have a trickle-down effect to the junior levels at any organisation. If older workers refuse to move on, how can younger ones hope to move up?
*Should older people be forced to retire at 65, to make room for younger workers?
Is it unfair that they’re allowed to hog space (and money) at the end of their careers – while young people are struggling to get their careers started?