Older Workers: Job Market Opportunities
(2 years, 9 months ago)
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Baroness Altmann
To ask Her Majesty’s Government what steps they are taking to ensure that older workers can secure new opportunities in the jobs market.
Baroness Altmann (Con)
My Lords, I first thank the House of Lords Library staff for their excellent help with the background statistics for this debate. I also thank the Centre for Ageing Better for its helpful briefings. I declare my interest as a board adviser to the not-for profit community interest company Bravestarts, which is already helping many older people to find ways to return to work in later life. I am also an adviser to the International Longevity Centre. I also thank all noble Lords who have attended this short debate today.
For many decades now, average life expectancy has been rising and people have had longer periods in retirement. Recognising the dangers that this would pose to future public finances and growth in a rapidly ageing population, Governments have pursued policies of increasing state pension ages, abolishing mandatory retirement ages and encouraging longer working lives. Indeed, this House is a live example of the value added by the experience, maturity and energy of older people who are still working. Older workers bring valuable talent, skill sets, patience and wisdom, which are often lost when recruitment focuses only on the young.
The ideal scenario for many, as they enter their 60s and even 70s, may be to reduce working hours from full-time to part-time, which is why the trends towards more flexible employment are most welcome. They will allow people to build extra income both now and in the future, as well as boosting their pensions and overall economic growth.
The employment rate for over-50s and over-60s, especially women, had been steadily increasing, boosting the economy. The National Institute of Economic and Social Research showed that people retiring just one year later than previously can add one percentage point to economic growth each year. However, if more older people pull out of employment altogether, this source of economic growth disappears, the economic activity will remain permanently lower and the pension savings of those who are no longer working will be unable to last as long.
This is why there is a concern that, since the pandemic started—since December 2019—the indications are that the employment rate for those aged between 50 and 64 fell from 72.7% to just 70.9%, reversing a well-established long-term trend. Indeed, I argue that the jobs statistics released recently suggest that perhaps the single biggest challenge in the labour market at the moment is how we help older people to stay in or return to work. Despite record numbers of job vacancies—1.3 million—and with labour supply currently lagging behind demand, 600,000 fewer people are in work now than two years ago, and economic inactivity has risen in the past months, largely driven by the over-50 age group, particularly women.
The largest proportion of the economically inactive are the older women who are less likely to have private pensions or have much less private pension. That indicates that the pandemic may be having more worrying knock-on impacts than perhaps have yet been factored into economic forecasts, if it has reduced the ability and perhaps desire of people over 50 to stay in work and may have increased health inequalities in the population, which were already stark, with a 20-year differential in healthy life expectancy across the country. The employment gap for older workers relative to the average in the population and the disability employment gap have both widened. Once again, those trends of concern are reversing the positive gains seen up to 2020. It will be important to see whether those trends will reverse after Covid. I certainly hope so.
I commend the Government on their October 2020 Plan for Jobs programmes offering financial incentives for employers who are considering hiring new staff. I welcome the Restart scheme and the October 2021 expansion of support packages, with the lifetime skills guarantee, the national skills fund, skills bootcamps for adults and the over-50s champions in jobcentres.
We are seeing a potential that needs to be carefully observed by the Government. In our ageing population, commitments to encouraging longer working lives are important for long-term economic growth as well as individual well-being. The coalition Government asked me to be their older workers’ business champion. The plight and needs of the over-50s in employment or wishing to return to work were made clear in my report, A New Vision for Older Workers, with recommendations based around helping employers and individuals with what I called the three Rs: retain, retrain and recruit, which are all the essential ingredients of a successful strategy for increasing jobs, labour force participation and opportunities for the over-50s in the labour market.
Indeed, as work becomes physically less demanding, having the opportunity for people to enjoy working in later life is important. I know that it is also important to my noble friend the Minister and her department. I ask her to take back to her department the need for published evaluation and evidence on the effectiveness of schemes that have commendably been introduced and specifically designed to help the over-50s back into work. What works best? Is her department working on any detailed research projects, perhaps in collaboration with a university or the excellent departmental officials, to understand the interventions that can best assist in retraining, retaining and recruiting older staff who might otherwise be at risk of leaving the workforce?
Might the Government consider incentives for employers to create specific programmes to ensure that older people are seriously considered rather than overlooked when it comes to in-work training? Many older people are willing to accept lower pay in order to participate in training programmes or programmes to help them change career but find that they are not widely available for older applicants. With a number of employers, I organised schemes for older apprenticeships, but older people often did not seem to believe that they should apply because “apprenticeship” relates, in their minds, to younger people. Might the Government consider the same kind of principle but maybe calling such schemes “career changer” incentives or “new career” programmes, to ensure that employers are encouraged to offer opportunities for training to new recruits at older ages? Individuals may be more likely to apply.
I also hope that my noble friend will consider whether companies might be required to report on what they are doing to ensure they are providing an age-friendly environment at work, one that offers the flexibility for part-time, but also includes in retraining those of all ages and career stages, fairer consideration of older applicants when recruiting and proper age audits as part of their diversity, training and recruitment strategies.
Making older workers feel valued is really important for all our futures. In the context of pensions, I have concerns about people pulling out of the labour market early. Are they just using their private pensions to bridge themselves from age 55 to 65, until their state pension starts, but have nothing left later? Will my noble friend encourage the Treasury to monitor and conduct research into what is happening when people are taking money out of their pensions? Making workers feel valued is important. Benefiting from the wisdom that comes with age and being part of a successful workforce can help with our Covid rebuilding programme.
Lord Davies of Brixton (Lab)
My Lords, I thank the noble Baroness, Lady Altmann, for the opportunity to discuss this important issue. I agree that the central issue here is what we can do to enable older people to choose to stay in work or to return to work.
Over all this discussion, we have the pandemic and what we hope is a move away from it. It has had impacts across our whole social and economic life, not least in its effect on patterns of work for older people. Since the start of the pandemic, we have seen a steep reversal of trends in employment. There had been a consistent increase in employment rates among older workers since the mid-1990s and a fall in inactivity rates, but between 2019 and 2021, the department’s figures for employment show that the rates for 50 to 64 year-olds fell by 2.8 percentage points for men and 3 percentage points for women.
The Institute for Employment Studies has calculated that if pre-Covid-19 trends had continued, there would be almost half a million more older workers in the workforce than we have today. This reversal of the earlier trend clearly comes at a cost for those involved: to individuals who cannot afford to lose either the income or social structure that work provides and to society as a whole, with reduced output of goods and services.
To the extent that this reflects older people choosing of their own wishes to enjoy more leisure, as against income, it can be welcomed but there is little evidence that this is the main or significant driver. The truth is that most of those who have given up employment did not have a choice but were forced out of the labour market through lack of work opportunities, ill-health or family responsibilities. The question, therefore, is what we and the Government can do about it.
In suggesting some policies, I base my remarks in large part on the excellent and timely report from the TUC, published on 23 February, Older Workers after the Pandemic: Creating an Inclusive Labour Market. I urge the Minister to read it, if she has not already done so. The TUC’s report makes it clear that increasing older workers’ participation in the labour market will require major changes in the workplace to ensure that older workers have the skills they need and that jobs and workplaces meet the needs of an ageing workforce. This goes alongside the need to ensure that those who are unable to continue working into their mid-60s are not penalised as a result, which will require an overhaul of working and pension-age benefits.
As pointed out by the TUC, there are class and ethnic dimensions to the challenge we face in offering older people the opportunity to keep working. People in low-paid and manually intensive jobs are at far greater risk of being forced out of the labour market early. Those working with heavy machinery and in elementary occupations such as cleaning or security are particularly vulnerable, closely followed by people in caring and other service occupations, retail and customer service. Together, these occupations account for just three in 10 jobs in the labour market, but almost six in 10 people who leave the labour market come from these sectors. Plans to tackle labour shortages by helping more older people stay in work must tackle the structural discrimination that means workers on lower pay are more likely to be pushed out.
At the same time, while black and other ethnic-minority workers are less likely to retire early than their white counterparts, those who leave the labour market early are significantly more likely to do so because of poor health and more than twice as likely to do so because of caring responsibilities. From an analysis of the Labour Force Survey, the TUC found that just 17% of black and minority-ethnic people between the ages of 50 and 65 who are economically inactive have retired compared with 40% of economically inactive white people, reflecting the wide ethnicity gap in average pension wealth.
So what can we do? First, particularly as we emerge from the pandemic phase of Covid, workplaces must be made safer for all workers through improved health and safety guidance and stronger enforcement. The Government should work with unions and employers to ensure that we address workers and skills shortages and deliver the Government’s stated ambition of a high-wage, high-productivity economy.
Secondly, we need to ensure that older workers have the skills needed to thrive in the labour market by giving them the right to a mid-life career and skills review and to access funded retraining and by providing tailored support for older workers at risk of long-term unemployment or of falling out of the labour market.
Thirdly, we should help older workers to manage disabilities and health conditions by ensuring that employers put in place reasonable adjustments for disabled workers and tackle workplace discrimination and by strengthening flexible working rights to allow older workers to manage workloads.
Finally, we have to look at reforms of the benefits system so that people of all ages who are unable to work can maintain a decent standard of living. We must pay attention in that area, which affects older workers most acutely.
The Earl of Leicester (Con)
My Lords, I thank my noble friend Lady Altmann, with whom I find myself sharing an office as of this week. I refer to my interests relating to land-based and tourism businesses in north Norfolk, as recorded in the register.
One of the things I am learning as a new boy in this House is that, prior to speaking, it is a good idea to see who you are up against in the debate. The answer, as a quick whip through Wikipedia led me to discover, is Peers with knowledge and experience on this subject far deeper and greater than mine. I will therefore limit my contribution to my experiences as an employer in land-based and tourism businesses, which I hope will illustrate the benefits that businesses derive from employing older workers and, of course, the benefits that older workers receive from continuing to work into their later years. Both these factors feed into greater benefits for the economy as a whole.
I was concerned that, as a young man of 56, I might not be able to speak authoritatively on older workers. However, I have learned that the Government class older workers as those aged 50 and above. Living longer and in better health, and with the removal of the statutory retirement age, we can expect to continue to see high levels of employment in this group. According to the Centre for Ageing Better’s report The State of Ageing in 2020, one in three workers was 50 or over.
This is borne out in our statistics at Holkham, where I live and work. Some 35% of the staff employed are aged 50 and over; 27% are 55 and over; 16% are 60 and over; 10%, or 27 people out of a workforce of 274 employees as of four days ago, are 65 and over; and 4%, or 11 people—I am rightly proud of this—are 70 and over. The gender split is evenly balanced across the age bands. This trend in our companies towards employing older workers has increased slightly in the last decade.
In the 55-and-over group, staff are employed across a broad variety of positions, including room stewards and guides, car park attendants, visitor services, retail, housekeeping, houseman, tractor and trailer drivers, a gamekeeper, academics and in administration and cafés. I have to admit that the vast majority are in lower-paid positions, but at the real living wage of £9.90 or the next rate, £10.50 an hour. Staff in this age group enjoy the flexible, part-time and/or seasonal nature of the positions, although I have to add that a good number are full-time. They enjoy interaction with people, and are good at it, and being able to make use of their skills and knowledge. While most report needing some form of income, often additional to their pension, they are often more motivated to provide an excellent service in what they do and, frankly, to keep themselves busy and the grey matter working.
Grouping people together from the age of 50 to 70 and over to highlight the pros and cons of employing this age group is done with the caveat that not all are the same, but we believe that the key benefits and advantages are as follows. I am pleased to report that the list of benefits is longer than that of disbenefits. Older workers are dependable, reliable, punctual and trustworthy. They are respectful and recognise that they are here to work and do a good job. They bring a wealth of broad-ranging experience, from ex-police officers to teachers, former senior directors, marketing specialists and, of course, skilled ex-manual workers. Their experience benefits less-experienced, often younger people. It provides excellent insight and ideas into improving work processes and practices. It also leads to us very quickly giving this group of staff accountability. They have the experience and confidence to be trusted to get on with it. Typically, they have excellent customer service skills. They go above and beyond in their knowledge and care. They do not have dependent children and are therefore less likely to have emergency issues, and are more willing to work weekends or bank holidays.
There are disadvantages. Conversely to the above, they might have elder care responsibilities. A lack of compulsory retirement age can lead to the requirement for a performance management process if someone is no longer performing or their health capability impacts on their ability to fulfil the position. This has not been an issue for us yet, but I suspect that it may be in the future. They are also typically less likely to be IT savvy, particular in terms of new functionality or shortcuts with systems. They are probably unlikely to be the people in the organisation who innovate or streamline, as their previous experience and technical knowledge can be somewhat outdated.
I have an observation on interviewing older job applicants. Quite often, candidates will say things like, “I’m really old, so you probably don’t want me”. That is a sad reflection of a lack of confidence or a poor experience when applying for other positions. Having had recent experience of working with DWP work coaches on the Kickstart team, my team is concerned that the DWP needs to ensure that adequate resources are in place to support the further expansion to 50-plus support. Work coaches need to work more collaboratively with local organisations.
I take slight issue with the assertion by the noble Lord, Lord Davies, that most people have been forced out of work. My experience is that they have generally retired voluntarily. It may have a geographical influence inasmuch as they might have retired to sunny north Norfolk, but I can think of only one person for whom this was the first job he had had in five years. I hope that this has been a useful illustration for the debate.
Baroness Greengross (CB)
My Lords, I thank the noble Baroness, Lady Altmann, for securing this important debate. The Office for National Statistics published data in November 2021 showing that, since the end of the Government’s furlough scheme during the pandemic, many over-50s have fallen out of the workforce. The figures showed that, in September 2021, 362,000 over-50s were unemployed and 3.5 million people aged between 50 and 64 were economically inactive.
As we know, one of the key challenges we face in this area is discrimination and some outdated ideas about age and work. Since the Equality Act was passed in 2010, it has been illegal to discriminate against someone based on their age; this includes age discrimination at work. To be clear, this age discrimination is not just against older workers. It also includes young adults, who often face considerable challenges due to discrimination.
Why am I talking about young workers in a debate about older workers? Since I ran Age Concern England for many years, people believe that my passion and area of knowledge is solely ageing. In fact, much of my earlier career and later voluntary work was in supporting young people. From 2006 to 2012, I had the privilege of being an equality and human rights commissioner. In truth, human rights have always been my main area of interest, rather than ageing or focusing only on a particular stage of life. My work in advocating for older people has always been focused on ensuring that people’s human rights are protected and not changed or diminished after a certain number of birthdays; that is pure discrimination.
Despite being illegal, age discrimination is still rife. One of the key reasons for this is unconscious bias against older people in work—and, in fact, in society generally. This is often reinforced by structural bias, whereby organisations continue to work within structures and policies that assume that the human life course is much the same as it was a century ago. The human life course has changed and continues to change; as we know, it depends on change. A baby born in 2022 will not live the same life as someone born in the 20th century. The idea that we go to school until we are 18, get a qualification so that we can get a job, work until we hit our 60s and then retire is totally out of date. In 2022, someone who is 50 could easily spend another 25 to 30 years in the workforce, yet people in their 50s are too often dismissed as “older” when in fact they may live and work for many more years, often with life experience and talent.
The Deputy Chairman of Committees (Lord Russell of Liverpool) (CB)
My Lords, the bells are not ringing for some reason but there is a Division going on in the House. I move that the Grand Committee adjourn briefly. Officially we are meant to do so for 10 minutes, but I suggest that we resume once all noble Lords participating have indicated to me that they have voted successfully.
Baroness Greengross (CB)
My Lords, too often, even people meaning to do the right thing inadvertently reinforce age discrimination. An example is the campaign by various ageing organisations in the UK and internationally to create a separate UN convention for older persons’ rights. There are two problems with that. First, it is not clear who we count as old. As we know, people age at different rates and the ageing process affects people quite differently. If we are saying that people over 50 are older, when life expectancy in the UK is currently 81 years and an increasing number of people are living to 100, that is, frankly, ridiculous. Worse, it says that when someone is older, having had a certain number of birthdays, their human rights are different and covered by a separate UN convention. Separate conventions may do good work to protect the rights of disabled people, where we can clearly define what is a disability, but with ageing it is much vaguer.
Worse, our understanding of ageing is generally built on a lack of understanding and an unconscious or, at least at times, conscious diminishing of older people’s contributions to society. We do not need a separate UN convention; we do not need to treat people differently. Instead, we need to treat a 73 year-old worker not as an older worker but as a worker, with the same human rights as everyone else. If a 73 year-old worker develops a disability, we should support this worker in the same way as we support a 53 or 33 year-old with a disability. Instead, we label older people pensioners, defining people over a certain age by their eligibility to receive state income and dismissing their potential contribution to society.
To be clear, I am not suggesting that we abolish the state pension, and I believe it was an important part of developing our welfare state in the 20th century, but in 2022, we need to understand that not only do many workers work well beyond the state pension age but it is often good for a person’s health and quality of life to do so. One of the biggest challenges we face is isolation and loneliness, something often experienced by people who have retired or are no longer economically active. This can lead to depression and is a contributing factor towards people developing dementia.
What steps can the Government take to support older workers to secure new opportunities in the jobs market? Our first step is to challenge unconscious bias and outdated ideas about ageing and work. We must do more to enforce anti-age discrimination measures in the Equality Act. This starts with education and challenging those outdated ideas. Crucially, it is also about challenging the idea that older people are to be treated differently, including by those wishing to help them. Instead, we need a strong economy that provides good jobs for all adults, whatever their age, who are willing and want to work, and makes it possible for them to do so.
Baroness Barker (LD)
My Lords, it is a great pleasure to take part in this debate on a subject to which I first had to pay attention in the run-up to the millennium, when the organisation for which I was quite a young worker at the time, Age Concern, held a “debate of the age”, looking strategically at big questions to do with an ageing society. One of the advisers to that was the then Ros Altmann, and the driving force and inspiration behind it was the then Sally Greengross. It is a delight, 20 years on, that they are still taking the fight on this subject.
I am glad that we had the very informative briefings from the Library and the Centre for Ageing Better. I found a paper that I think crystallised the issues and speaks in many ways to what the noble Earl, Lord Leicester, said. The Age Smart Employer network in New York produced a paper that came up with a number of lessons for employers in recruiting and retaining older workers. One is that older people have skills and experiences that cannot be readily taught, such as critical thinking. They retain business knowledge, knowledge about networks and the historical memory of the organisations for which they work. It is absolutely true that they tend to have, on average, more technology gaps, but those can be filled and taught. To take Zoom and the House of Lords three years ago as an example, we have moved light years in a short space of time. You can learn that.
But this paper really goes to the heart of what the noble Baroness, Lady Greengross, was saying: the best teams are different. They do not have groupthink; they have different skills, and sometimes that comes from different generations. One thing that older people have is an insight into customers, which is particularly important. I have in fact been to Holkham Hall, as a paying customer, and I can testify to the teamwork and atmosphere that the noble Earl, Lord Leicester, talked about.
Perhaps I was having a particularly bad bout of insomnia, because, during Covid-19, I came across one of the most informative programmes, “Farming Today”—skip the “Today” programme and go straight to that. Long before anybody else was talking about shortages of HGV drivers, “Farming Today” was talking about problems with getting milk from farms and so on.
The noble Lord, Lord Davies, is right: Covid has brought to the surface a whole load of things that many people have known about but that we have never approached in any kind of coherent fashion. There is a case for looking at sectors of work and the age profiles of people in them—and for not being afraid to take on and address some of the prejudices and what people might be shying away from in looking at that strategically.
This is a subject where we have broadly known for a long time what the causal factors are. Different Governments have brought to the table different initiatives, none of them very coherent or long term. There is a real problem, in that different Governments approach this issue differently: is it a matter of mitigating potential draws on the welfare benefits budget, is it about developing a future plan for work, is it about skills deficits or is it about the fact that we have never really—not for want of trying—got to the very heart of how we get apprenticeships to work, in terms not just of specific skills for specific jobs but of equipping young people for working life, which is something to which older people have quite a lot to contribute?
So I will go back to where I started, which was 20 years ago with the noble Baroness, Lady Greengross, trying to take an informed and strategic view of this, listening to academics and doing foresight work with government, as far as was possible, to look at the changes in technology and medical science that were going to affect the health of the population. If we were to do that in the way that the noble Baroness, Lady Altmann, suggested—not as a knee-jerk reaction but really looking at what has come to the surface post Covid and at the future of work over the next 20 years, when we will not have the influxes of short-term and seasonal labour that we have had in the past—we should have a thoroughgoing look into the demographics of ageing. Apart from anything else, the big tech companies and the people behind them will have something to say on this, because they have begun to look at this area of work because they appreciate that the market of young people, which they have traditionally relied on, is perhaps now changing, and they need to look at that in a different way.
So I very much welcome the contributions in this debate, and I hope that, with the enlightened Minister that we are lucky to have in this House on this subject, we might perhaps take a step towards a new strategy for multigenerational workforces.
Baroness Blake of Leeds (Lab)
My Lords, I add my thanks to the noble Baroness, Lady Altmann, for bringing the debate into this forum. I hope that we can move forward together in such an important area. I also thank the staff and all the people who have sent us briefing notes on this important issue, and I particularly thank everyone who has contributed today—the wealth of experience is quite something, and we should really celebrate that and make sure that we pull together.
Perhaps I may add my own humble experience. I had the role of social policy manager for the Yorkshire and Humber Assembly, back in the day when we had such glorious bodies. I remember well the debate of the age, and I helped pull together a document. Moving on through my role in local government—I should declare my interest as a vice-president of the LGA—UNICEF encouraged local authorities to move towards child-friendly cities. That was its big thing. As a consequence, cities—Leeds, in my case, but also many other communities—have moved on to declare themselves as age-friendly towns and cities. It is an interesting development. In reflecting on the work of the noble Baroness, Lady Greengross, they have moved on to intergenerational work, which is fascinating. They give all the elements and sections of communities a voice.
I should like to bring to the debate a recognition that no one department or policy area can solve the problems that we are talking about. It is depressing that we are still grappling with issues that were highlighted decades ago when the demographic impact of an ageing population became apparent. I look forward to hearing from the Minister what is working well as a result of the Plan for Jobs programme, what more is being proposed and how new proposals will be successfully implemented, especially in the light—as we have heard, particularly from my noble friend Lord Davies—of recent evidence highlighting the impact of the pandemic on older people. It was a cruel virus that particularly exposed structural weaknesses to a terrible degree for many people.
Linked with that is the rising imperative of dealing with skills shortages and employment needs across all sectors nationwide. We have learned that pre-pandemic, we were already starting to see a drop off in economic activity in the over-50s to the extent that by state pension age, half were not working. That represents a loss to the economy but, importantly for many, as we have heard, a huge loss to them of the financial and social benefits of working. There is poverty for some in old age, and the whole issue of loneliness is a pandemic in its own right.
I echo the comments of the noble Earl, Lord Leicester, on the importance to economy. Almost a third of the UK workforce is aged 50 and over, which is reflected in key workers—and how dependent were we on key workers during the pandemic? What does it mean for us as a society that 3.4 million key workers are over 50? What are the most common causes of people leaving the workforce before they are ready to do so? They are ill health, caring responsibilities and disability at an early age. We need to consider carefully all those areas— in particular the socioeconomic factors that highlight chronic inequality. Consider that there is a 20-year gap in disability-free life expectancy between the richest and poorest areas for women and an 18-year gap for men. That all points to the need for a real assessment of the support needs for people with health conditions to enable them to stay in employment. A key factor surely in the levelling-up agenda, which we have not talked about today, has to be how we address those issues. Are we joining up policy areas to achieve an integrated approach to dealing with the problems mentioned?
It is obvious that in the workplace today there is a critical need for retraining and supporting employment opportunities for older women. Skills shortages are being identified across a range of sectors as one of the major obstacles for businesses in planning the future viability of services, as well as the economy. Recognition of the transferability of skills and experience is a sensitive issue and needs to be part of a bespoke, locally based skills programme. Devolving resources and responsibility to local areas will be key to achieving success in these programmes.
We need to recognise upfront that previous back-to-work schemes have not worked, particularly for older people. The outcomes for the over-50s are much lower than for other age groups. A fresh approach is overdue and urgently required. Organisations such as the Centre for Aging Better have undertaken research, as I am sure we have all seen, and highlighted very sensible and practical ways to achieve success in 50-plus employment support programmes. We know is that target-driven approaches do not work. We need to have a real and honest debate, as we have discussed, on real and perceived discrimination against all people and, particularly in this scenario, against older people.
We have had a lot of statistics today and I do not want to repeat them. However, I want to ask about those who have fallen out of the labour market for good, and not through choice. How exactly does this fit with the Government’s stated ambition to extend working lives, increase productivity and level up the UK? I would also look at some of the evidence of the terrible experiences that the WASPI women had.
I have a lot of questions and the Minister will be very pleased to hear that I have run out of time to ask them all. In finishing, can we have confidence that the Government will produce bespoke, evidence-based schemes specifically for the 50-plus cohort? Will they also commit to funding public campaigns, which can be delivered at a local level, highlighting the importance of older workers? With those comments, I look forward to further debate on the matter as we move forward.
The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office and Department for Work and Pensions (Baroness Stedman-Scott) (Con)
I thank all noble Lords for their contributions. They have saved the best debate until the end of the day. It has been one of quality and challenge, which is a good thing.
I congratulate my noble friend Lady Altmann on securing this debate. She has been a tireless champion for older people, before and after entering this House, and speaks with great knowledge on the area of older workers, resulting in positive action. Her work as Pensions Minister is well known, but before taking up that post, she had already set the agenda for older workers as their first business champion. Her report A New Vision for Older Workers: Retain, Retrain, Recruit laid the groundwork for the Department of Work and Pensions’ 2017 strategy Fuller Working Lives, which we are still delivering through the 50Plus Choices team. I am delighted to respond to her question today and to provide details of the new and continuing work which the Government are undertaking on behalf of this incredibly important group.
To quote the noble Baroness, Lady Blake, I will run out of time. I am sure she will be happy at that point but, where I have not answered a question, I undertake to write to all noble Lords and place a copy in the Library.
As noble Lords have said, older workers are vital to our economy. The proportion of the population aged 50 and over is projected to increase from 42% in 2010 to nearly 50% by 2035, or 29 million people, so it is essential that the Government and employers make every effort to help and encourage this group with enthusiasm, experience and expertise to enter, stay in and return to work.
Firms with fewer older workers are missing out on the improved productivity, which all noble Lords have talked about, generated by social mixing and a transfer of knowledge between generations. When I ran my charity, I was always delighted when we had more mature members of the workforce with experience because when the younger ones were finding their feet and having those junior moments, rather than senior moments, it was great to be able to get the experienced ones to mentor them. I remember so well that some of them got into pretty deep water and the people with life experience helped them out of it. It kept them in the workforce, so I do understand that.
Dismissing older workers as being past it and allowing them to underestimate themselves is not just damaging to the individuals who are denied access to opportunities to grow, develop and earn. These attitudes are also damaging to individual businesses and to our economy—that was a very important point made by the noble Baroness, Lady Blake. We know that age diversity in the workforce is not just the right thing to do but that it can bring benefits to business, and many employers value the experience and loyalty that older workers can bring, as well as broader advantages such as fresh perspectives, knowledge-sharing and improved problem solving. I remember so many times when we had difficulties—which I am sure will resonate with some noble Lords—and someone would pipe up to explain what was done 10 years ago, which was really helpful.
I know that the pandemic caused catastrophe to some people’s employment but it has created particular challenges for the over-50s. Older workers took longer to come off furlough than their younger counterparts, and some of those who left have not returned to the labour market at all. Even before the pandemic, job-seeking presented particular challenges for older people. Evidence shows that those in this age group who lose their jobs are at greater risk of becoming long-term unemployed, and once they return to work, they are likely to earn substantially less than in their previous job. Data suggests that people aged over 50 who lose their jobs are twice as likely as other age groups to be unemployed for at least two years, which can mean that older workers are forced into early retirement that they may not want or are unable to afford. That comes to the point that my noble friend Lady Altmann made about people using their pensions to get them through that period.
I say to the noble Lord, Lord Davies, that I will find that TUC report. We will read it and see what we can learn from it.
The Government’s older workers agenda, which, as I have mentioned, was influenced and informed by my noble friend Lady Altmann, had been making steady progress in addressing these issues. Pre-pandemic employment levels for older workers were at a record high of 10.7 million and the employment gap between over-50s and the 35 to 49 age group was narrower than ever before. However, the pandemic has sadly reversed this positive momentum and we have seen encouraging trends slip into reverse. The Government are watching the data carefully and are determined not to allow this setback to become a backward slide.
Labour market support and demand is there. We have huge numbers of vacancies and I am sure that, around the country, among our more mature population, there are people who could ably fill them. We must help them to believe that and apply for those jobs. That is why I am delighted that the Chancellor announced a £500 million boost for the Plan for Jobs to ensure that more people of all ages, including those aged 50 and over, get tailored Jobcentre Plus support to help them find work and build the skills they need to get into work.
As part of this, the new Way to Work programme will ensure a laser focus on securing work for every customer. It requires us to use every interaction, every employer relationship and all the work provision we have available to help people achieve their potential by finding a job, and in doing so support our country’s recovery.
I know that there was concern that we were going to use that as a sanctions bonanza. Nothing is further from the truth. All the jobcentres that I have visited have welcomed this programme as a real opportunity to provide tailored support to all ages. I can assure noble Lords that nobody is rubbing their hands together saying, “How many sanctions can I do today?” They are saying, “How many people can we get into work today?” The package will provide more intensive, tailored support for older jobseekers in the first nine months of their UC claim. This extra time will allow work coaches to spend longer with customers, developing strategies to overcome any barriers to work that they might be facing.
My noble friend Lord Leicester mentioned employer engagement, which was of course identified in my noble friend’s report in 2015. If we are to help people enter or re-enter the labour market, our relationship with employers is absolutely critical. They are the ones who create jobs and know the skills they want, and we have to be really good at matching them up and supporting people not just to get a job but to stay in it. I always found that getting someone into work was good, but keeping them there was the best.
The Government send this message out loudly and clearly to employers, including through the current business champion for ageing society and older workers—I am sure that we can come up with a better title than that; I do not know what kind of brand that gives us—Andy Briggs, CEO of the Phoenix Group. The business champion does incredible work in promoting suitable employment practices and measures to support those with disabilities or health conditions to stay in, progress in or remain close to the labour market.
The noble Baronesses, Lady Barker and Lady Blake, both raised cross-government co-ordination. I am delighted to say that the DWP works closely with other government departments to bring together and advance the full range of projects that could promote better employment outcomes for older people. We collaborate closely on the mid-life MOT—I know that my noble friend Lady Altmann will be pleased about this—with the Money and Pensions Service, the Office for Health Improvement and Disparities and the National Careers Service. This helps people plan ahead to prevent health, skills and pension challenges for a fulfilling later working life, with information on pensions, skills and health. We work with the Department for Education to highlight the interests of older people in relation to the Government’s lifetime skills guarantee, which provides free courses for jobs and £375 million of funding for new skills boot camps, made available through the national skills fund.
I will answer as many of the questions as I can, but I hope that noble Lords will forgive me if I do not address them all. My noble friend Lady Altmann asked whether the Government would consider incentives for employers to create programmes. On that, I say: please do not just sit in this House if you have a good idea—let us have it. We will write to my noble friend with any other information we have on that.
My noble friend also asked whether the Government would consider ensuring that ageism in the recruitment process is not tacitly accepted, as appears to be the case now. When our work coaches work with over-50s, they sometimes take them to interviews—they do not let them go on their own sometimes—and do the sales pitch. So we are doing everything we can to make sure that age does not prevent people getting where they need to.
My noble friend asked whether the Government would consider a career-changer scheme. If noble Lords have any suggestions on that, we would love to hear them. I cannot answer all the questions on that. I know that my noble friend has encouraged me to ask the Treasury to do some research about taking money out of pensions. This is in my portfolio as the Minister responsible for research, so I will go back and talk to the team about that to see what we can do.
The noble Lord, Lord Davies, talked about the number of people who have left work: 41% of the people aged 50 to 65 who have come out of the workforce since the pandemic were using a private pension, savings or investments to fund their retirement, but they decided that retirement was now for them. Some of that is really sad.
My noble friend Lord Leicester, who is a very successful businessman, made the point that older workers are reliable and have a broad range of experience and maturity. As I have said, they also have a good influence on the younger workforce. I am in the bottom class for IT—my Private Secretary will endorse that—but I have found that more mature people are pretty good at it, to be honest. We should not make too many judgments that they are not. They can help young people.
The noble Lord, Lord Davies, talked about the mid-life MOT. It is a forward-planning exercise that is helpful to the people we are trying to help.
On the Plan for Jobs 50-plus programme, the offer, which my noble friend Lord Leicester raised, will ensure that older jobseekers receive more intensive tailored support, as I said. They will get the support from the work coach that they need in a flexible way. I know that Kickstart was raised in terms of putting more resources into it. I should be happy to have a meeting with my noble friend to learn more about that because we want to learn how it could be enhanced. We have that many programmes that we want to make sure that they have the best resource possible.
I will mention the noble Baroness, Lady Greengross, who is a noble friend to us all. What an outstanding career she has had in supporting older people. She has made the House richer for her membership and participation. I agree that we should treat everybody and not put them in little silos. I will now get a message saying that I have overrun. Do not worry. We have a national employer team who I meet on a monthly basis. The focus of our next meeting will be older workers. I will try and get back to noble Lords to tell you what the team is doing. There is no place for age discrimination. I just say to the noble Baroness, Lady Barker, that apprenticeships for older people are working well. I am pleased about that.
I finish by saying that the noble Baroness, Lady Blake, absolutely summed it up. Getting people into work is better for the economy and their health, and we must make sure that people are talking about their destiny in the workforce, not what perhaps might have happened. With that, I thank all noble Lords for their contributions.