Raising state pension age wont necessarily increase supply of or demand for older workers

Raising the state pension age is only a small part of the battle to balance the economic books, according to the Chartered Institute of Personnel and Development. With so many older workers not even working up to the existing state pension age, the greater challenge is improving the management of older workers to ensure they want to keep working, and to keep working productively. An abolition of the mandatory retirement age, as recommended by Lord Turner, would remove the ëejector seatí option from employers, and encourage better management of older workers.

Duncan Brown, Assistant Director General of the Chartered Institute of Personnel and Development, responding to the publication of Lord Turnerís Pensions Commission Report, said:

ìRaising the state pension age may well increase the notional supply of older workers, but it wonít necessarily increase the actual supply of them, or demand for them.

ìOne quarter of men and one third of women aged between 50 and the current state pension age are already not in the labour market. These people illustrate the real pensions and retirement challenge. If we want people to work longer, then we are going to have to find ways of ensuring that employment is attractive to older workers, and that they have the skills to make a contribution to the workforce.

ìToo many employers are lazy in their attitudes to older workers, happy to place them in the ëout trayí for years before they actually retire. This plays a part in declining job satisfaction amongst older workers. Keeping people working longer is one thing, but keeping them working productively and making full use of their skills and experience is a greater management challenge.

ìThe chances of an increase in the state pension age achieving the desired objectives and boosting UK productivity rest on the willingness and ability of employers to adapt their employment practices to engage older workers more fully, to motivate them, and to reduce their desire to retire early. If the government were to abolish the mandatory retirement age altogether, as Lord Turner recommends, they would remove the ëejector seatí option from employers and encourage a more careful focus on effective management.î