Working lives are being transformed

One in five New Zealanders aged 65-plus are still working and that number is predicted to climb to one in three. Technology, workplace disruption and an ageing population are transforming end of working careers.

We're living longer and the longevity revolution is cause for celebration although it does create some fundamental issues, says Chris Phillipson, Professor of Gerontology at Manchester University (below).

“We’re immersed in cultures designed for half as long as the ones we’re living in."

Professor Chris Phillipson with OS sign.

“By and large our cultures in the past have told us broadly the rules for certain areas of a life course."

"But because of the way life expectancies have increased…. all our systems; healthcare systems, social care systems, income systems are still struggling to adapt.”

Changing patterns of healthcare and employment are already having an impact and affecting some more than others.

There are many different employment models in Europe, reflected in the way working lives are being reshaped, says Professor Phillipson.

“We have gradual retirement, flexible retirement, there’s a European word that’s come in; ‘unretirement’ - we specifically use it to mean people who are still in work but would like to retire but they can’t because they’re under pensioned."

“These are the ways end-of-working-life is changing and it is completely transforming the world we live in.”

Employment rates high

Older New Zealanders no longer think they have to retire or step fully away from the workforce at the age of 65.

Unlike most other countries, there is no retirement age in New Zealand and one in five seniors is continuing to work, whether that's an hour a week, contracting, consulting, part-time or even full-time.

That's predicted to rise to one in three by 2031.

In fact, New Zealand is among the top three of OECD countries when it comes to employment rates for older workers.

“New Zealand is a striking example of exceptionalism in the field of employment – certainly when compared with Europe where they’re struggling with around 15 per cent of 65 to 69 year olds [who are working],” says Professor Phillipson.

Sweden and Finland have higher rates of employment for older men and women, but other parts of Europe, particularly Greece and the Mediterranean countries have very low rates, especially for women, he says.

“All OECD countries see extended working lives as the answer to their prayers in terms of economic problems.”

Professor Phillipson believes it poses some interesting questions which need to be addressed:

  • Will the participation keep growing, especially at older ages?
  • Is it desirable that it keeps growing?
  • The problem is some groups are more able to participate than others because they’ve got the health, they’re in the right industries.
MSD Tom at work

Tom continues to work because he enjoys the challenge

Professor Phillipson says an extended working life is usually available only to a select few.

“If you actually look in any country at the people who work after 65, they’re not actually drawn from a cross-section of industries, they’re actually drawn from particular sectors, and a high proportion are self-employed."

“The problem with the policy is it’s actually fundamentally discriminatory because it’s good for people to participate but it penalises those potentially who can’t.”

Other challenges include the following:

  • Are there policies in place managing longer working lives; re-skilling people, training people, preventive health – tackling people’s needs mid-life?
  • Will working longer increase social inequity?

Those continuing to earn have greater capacity to pay bills and meet expenses but a labourer, builder or tiler find their skills unable to be used as their bodies wear out before those of teachers or lawyers.

Unintended consequences

In addition to certain sectors being excluded, there are also differing life expectancies.

“Working class people [in Europe] have not been improving their life expectancy after 65 at the same rate as middle class people,” says Professor Phillipson.

“At the same time, we’re implementing policies that increase the age at which people can get the pension; that becomes a major source of inequality.”

He believes there’s a strong argument for a flexible pension age.

“Having a single age for your pension seems to me really problematic when your life expectancies are so variable.”

“Europe’s been very happy to extend working lives or extend the age at which people can get the pension – 68.  

“It’s been less happy to think about the implications for how people are going to be supported from their late 50s into their 60s so there’s a bit of a mismatch, I think, between pension policy on the one side and the labour market on the other.”

There are other consequences from extended working lives.

“If you have people working into their late 60s, a lot of the activities they would have been doing if they weren’t working, aren’t done – grandparenting roles, civic roles, all of those activities which keep communities going which are often done by people over 50,” says Professor Phillipson.

He says there were striking results from an OECD study looking at the relationships between employment rates and caring.

“Sweden, the country in Europe with the highest employment rate for older workers had the lowest amount of informal care,” he says.

“Italy, on the other hand, which had the lowest amounts of employed, had the highest level of carers.

“Those questions for me are rather important actually and I think they ought to be in the back of people’s minds in terms of thinking about policy.”