Is ill health the main driver behind the over 50s exodus?

The Covid pandemic brought about what many are calling a mass exodus of older people leaving the workforce, leading to rising rates of economic inactivity among the over 50s. Recent research shows that far more people are dropping out of the workforce due to economic inactivity – meaning they are neither in work nor actively searching for work – than for unemployment. According to figures from the Office for National Statistics (ONS), 244,000 people were unemployed between July and September 2022, compared to 623,000 who became economically inactive in the same period.

The ONS also reported that a record 2.5 million people were economically inactive due to long-term ill health in summer 2022, up from around two million in 2019. Meanwhile, a recent report by the Health Foundation found that 700,000 more people in the UK were economically inactive than before the pandemic, of which 300,000 were between 50 and 69 years-old; and by the second quarter of 2022, the single biggest reason behind the increase in economic inactivity in this age group was ill health.

The figures suggest that long-term health issues are one of the main drivers behind the increasing number of older workers leaving the labour market altogether in recent years, but is this the full story?

A complex issue

A recent report by the Institute for Fiscal Studies (IFS) revealed that, while there has been a significant rise in economic inactivity due to ill health in the last few years, it doesn’t necessarily mean that older employees have quit the workforce as a result of poor health. It says there are, in fact, other issues at play, such as people retiring early or losing their job and then becoming ill.

“Research from the IFS shows that, while economic inactivity due to ill health has risen significantly for 50-64s, the surge in people in this age group leaving the labour market has been driven by people retiring,” remarks Luke Price, senior evidence manager for work at the Centre for Ageing Better. “This presents two possible problems: first, an apparent worsening of health among people who were already out of work in this age group (making it unlikely that they will return) and a rise in people who could potentially still be working but have chosen to count themselves out of the workplace in favour of a different kind of lifestyle.”

Jon Boys, labour market economist at the Chartered Institute of Personnel and Development (CIPD), believes the increase in economic inactivity among older workers is due to a combination of reasons – and that these reasons are contested.

“CIPD research shows that around 42% of the increase in inactivity of older workers since the pandemic can simply be explained by shifting demography. Many people, including researchers at the Bank of England, have pointed out that the large increase in inactivity due to sickness and ill health is caused in part by long Covid and NHS waiting lists.

“However, the recent research by the IFS suggests that early retirement is a bigger driver than sickness. The truth is probably somewhere in the middle. Many people have the means to not work. Pension freedoms introduced in 2015 allow people to access money from age 55, and the housing market has boosted the wealth of homeowners. Then there is the question about a change in preferences as the pandemic forced people to re-evaluate their working lives. Each of these factors is difficult to quantify.”

Ageism and ableism

Price adds that, while poor health may not be the primary driver of older employees leaving the workforce since the pandemic, ill health has consistently been the main reason that people aged 50-64 are out of work – alongside retirement.

“We are more likely to acquire long-term health conditions as we age – particularly if our lives have been spent dealing with financial hardship, other forms of deprivation, discrimination and insecurity. For this reason, it is imperative that decent work is accessible to people managing long-term conditions who want to work, so that these inequalities are
not made worse.”

Indeed, there is also the glaring issue of older workers with health conditions being forced out of the labour market early, and whether this is in part due to ageist and ableist attitudes in the workplace. According to a study by think tank Demos, in partnership with the Physiological Society, most respondents aged 50-64 felt they had no choice but to leave work early, mainly due to experiences of ageism or ableism at work, as well as inadequate support from their employer or the NHS.

“Ageism and ableism are definitely an important part of this picture – and they overlap,” comments Price. “Our research highlighted employees’ concerns about the stigma employers might attach to long-term conditions which could lead them to being stereotyped and seen as someone who needs regular and extended time off work.

“Sometimes, despite an employee’s best efforts to manage a health condition at work, poor workplace cultures, processes and procedures around long-term health conditions can lead to older workers dropping out of work and left struggling to access secure, high-quality work elsewhere.”

However, Boys feels that the increase in inactivity since the pandemic cannot specifically be attributed to ageist and ableist attitudes. “This is a heavily researched area now and it has not emerged as a key theme. This does not mean that there is not a base level of discrimination that existed pre-pandemic, and continues to exist now, that is too high. Organisations therefore need to make sure their policies and processes are clear, objective, structured, and transparent so that they support more equal outcomes.”

Flexible working

The rise in economic inactivity in the over 50s, and the link with poor health, has in turn contributed to significant labour shortages this year, so it’s crucial that employers support those employees with health issues and ensure they are retained better.

One fundamental way of doing this is by offering flexible working. “Employers need to offer more flexible jobs that allow workers recuperating from illness, or having to balance caring responsibilities, to be able to work, especially at a time of severe skills shortages,” remarks Tina Woods, CEO of Business for Health.

Flexible working is the single biggest factor that would enable people out of work in their 50s and 60s to return to the labour market, adds Price. “Research shows that flexible working practices, such as compressed hours and remote working, can help people stay in work. Advertising a role as flexible could also increase applications overall by up to 30%.”

It’s also important for employers to ensure older workers feel confident in disclosing any health issues and to provide the support they need to help them stay in work.

“Age-friendly employers will support staff and line managers to have early and sustained conversations about health in the workplace,” says Price. “These conversations can be difficult but can be made easier if employers ensure managers receive appropriate training and know what support they can and should offer to their staff. Age-friendly employers can also make sure they have clear policies and processes in place for supporting workers with health conditions or disabilities. It should be communicated clearly to staff that managing health conditions is a normal part of working life, and that requests for support will not be stigmatised.”

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