New Government research strengthens case for flexible approach to retirement

April 2008

Research out today from the Department for Work and Pensions (DWP) has further challenged the traditional approach to retirement. The report confirms previous research findings from the Chartered Institute of Personnel and Development (CIPD), which show employees wish to work past the state retirement age for both personal and financial reasons. In response to the new research from the DWP, the CIPD is calling for Government to scrap the default retirement age of 65 and do more to encourage flexible working for older workers.

The CIPD report, Future demand for working among older workers, surveyed 1,000 workers aged between 50 and 64 years and found that almost two fifths (38%) of individuals plan to carry on working beyond 65. Currently, only 11% of the workforce work beyond State Pension age.

Interestingly, among those who said they did not plan to work past 65, 31% would change their mind if their employer allowed them to work flexibly; highlighting the unsuitability of a one-size fits all default retirement age.

Individuals in both the DWP and CIPD studies cited social reasons for working beyond state retirement (DWP, 67%; CIPD, 38%) as well as for the personal challenge it represented (DWP, 53%; CIPD, 52%).

Charles Cotton, Reward Adviser at the CIPD says: "Both our own research and the report published today from the DWP show that people are increasingly eager to work past the default retirement age, for social, personal as well as financial reasons.

"However, it is clear that Government policy could do more to encourage more older workers to stay on by extending the right to request flexible working beyond parents and carers and making pension arrangements more flexible. It should also remove the default retirement age of 65, rather than wait until the 2011 policy review, as this is proving to be a bureaucratic barrier for HR professionals and a barrier for many older workers who wish to work beyond retirement age.

"Forcing older workers into retirement with the default retirement age not only penalises those employees who enjoy work or need the income, but it diminishes the pool of talent for organisations who might otherwise employ workers past 65. It also condemns far too many workers in the years before their 65^th birthdays to bad management that fails to make full use their talent, experience and potential."

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