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As the baby-boomers of the swinging 60s edge towards pension age, often without the desire or the finances to retire, employers need to prepare for the workforce challenges this may create, actuary Douglas Anderson says.
By the 2020s, the UK will see an increase in 60-somethings who want to continue working - introducing both challenges and opportunities for employers. Specifically, the ban on contractual retirement ages creates both a threat to competitiveness and an opportunity to harness the experience and wisdom of older workers.
To tackle these head on, employers need to begin early in challenging some of the misconceptions and changing any unhealthy habits of their employees.
Where will all the sexagenarian workers come from?
The volume of sexagenarians is set to significantly increase, fuelled by the baby-boomers of the 1960s, more of whom are likely to work for longer than previously anticipated. The latest population projections reveal that the ranks of sexagenarians will grow from 7 million to 8.5 million by 2030, a rise of almost a quarter.
On the one hand, this is good news - it means that significantly fewer premature deaths have occurred, thanks to advances in healthcare. On the other hand, this boom will result in a greater demand for work and a growing reluctance among older workers to retire voluntarily. The changing environment of workplace pensions and the shift towards individual responsibility for pension saving means that growing numbers in their 50s have not saved sufficiently to enable retirement. We have also seen workplace pension schemes raise retirement ages to cope with an improving life expectancy.