Impacts of ageing for developed economies

In my second blog on the Ditchley Foundation conference on the implications of ageing in developed economies I’ve digested the discussion on the consequences of ageing. (Read the first post here)

Healthcare

It was striking that the conversation was dominated by healthcare. We distinguished between ‘true’ age-related healthcare costs, associated with chronic conditions and long term care, as opposed to the costs of the last year of life, which arise whenever someone dies and may actually be higher for early death (when people are more likely to benefit from costly interventions).

There was agreement that ageing is not the main driver of health costs, with improving technology and rising expectations considerably more important.

Participants questioned whether US health spending was an unusual outlier, or the inevitable trajectory for other advanced economies. While American delegates tended to be fatalistic about health costs, participants from other countries pointed to their success in checking rising costs and maintaining health spending at a lower share of GDP (usually with better health outcomes, since healthcare only has a small impact on a society’s health). Continue reading “Impacts of ageing for developed economies”

The end of forced retirement – today!

The 6th of April 2011 marks a milestone in the employment rights of older workers. Employers will no longer be able to issue forced retirement notices to their 65+ workers, meaning that for the first time employees in this age group will have the same legal protection as their younger colleagues.

Such a step has been needed for years, and can surely only be a positive move for the 900,000 people – and rising – who already work beyond age 65.  Chart 1 shows the upwards trend in people working at age 65 and above, and how this has increased by over 50 per cent going back to May 2005. While not everyone wants to continue to work after 65, for those who do the end of forced retirement will restore personal choice and economic independence, allowing people continue to build pension provision and benefit from the social networks that many workplaces bring.

Chart 1: numbers in employment aged 65+

So we congratulate the Government for sticking to their guns and ending this deeply unfair practice.

There have, however, been a couple of minor changes to the transitional arrangements. The Department for Business, Innovation and Skills had originally proposed having a blanket end to forced retirement on 30 September 2011 i.e. within six months of the last notice-issuing day (yesterday). However, last minute changes to the transitional arrangements have meant that employers will still be able to give up to a years notice to their employees – providing they are 65 before October 2011– meaning workers could be forced out until April 2012. In addition, it will still be possible to agree an extension of up to a furher six months, meaning the final forced retirements could take place as far away as October 2012. This is disappointing for many, but for some it will be considered preferable to being forced out of work immediately.

So what’s likely to happen in the post-DRA world? Continue reading “The end of forced retirement – today!”

Phasing out the Default Retirement Age

After many years of campaigning by Age UK and our predecessor organisations, the Government announced in July that it would be phasing out the Default Retirement Age (DRA) in 2011. This is great news for people approaching State Pension Age, as the choice of when they retire is effectively being handed back to them, with their employer no longer able to tell them to leave simply because of their age.

The Coalition Government made it clear that they would end this unfair practice, with a commitment to ‘phase out the DRA’ appearing in the Coalition Agreement. This was good news indeed, but nonetheless as the DRA is abolished there will undoubtedly be other issues that arise. The Government ran a consultation over the summer on how to achieve this aim, which raised some issues that will need to be faced by both businesses and employees. They did, however, offer a fairly firm timescale, with an end to retirement notices being issued after April 2011, and therefore no forced retirement at all from October.  Continue reading “Phasing out the Default Retirement Age”

Introducing ELSA for the 4th time

As the dust was settling from the Spending Review, the world of UK ageing research gathered at the Royal Society last Thursday for the launch of the fourth wave of the English Longitudinal Study of Ageing. ELSA, as it ubiquitously known, is the single best source of data on experiences of later life in England. It tracks a group of people aged over 50 every two years, returning each time with detailed questionnaires and medical tests. After a day of presentations from researchers, focusing on everything from energy prices to sleep patterns, I joined a panel, chaired by Sir Michael Marmot, tasked with summing-up and reacting to the findings. So what were my first impressions?

Royal Society, London
Royal Society: Flickr user SBishop

Drawing some of the bits of the jigsaw together, first of all, the report shatters a few myths about getting older: people have better experiences of sleep as they get older; the number of people in later life who are underweight is very low; withdrawal from organised social activity in late old age is far less common than you might think; and caring for your partner is a greater burden than caring for your parents.

These snapshot findings are startling enough, but the real strength of ELSA is the portrait it can paint of change over time. With data now available from 2002 to 2008 a picture of the last decade is starting to emerge.  We know that on average older people now have higher incomes, driven by wealthier groups reaching old age with a higher share of non-state income than previous generations; spending on energy has risen significantly, as had spending on essentials overall, for poorer households; the credit crunch led to a noticeable decline in average personal wealth between 2006/07 and 2008/09; and over a longer period there was also a concerning decline in satisfaction with life and an increase in loneliness.

The single most positive change over the decade I picked up was the population-wide decline in cholesterol levels, evidence of the impact statin prescriptions have been having.  But the news on health in general is far more concerning: within each age group there is no clear evidence that health has been improving over the course of the last decade. Given that life expectancy has been rising fast, this implies people are living for more years with ill-health and disability – so called, extension of morbidity. The researchers were careful to say these were early findings; but if they’re backed up by other sources, this is a very serious trend, both for personal wellbeing and the national finances.

Finally, ELSA wave 4 paints a new portrait of inequality in later life. In some areas the evidence suggests that inequality is entrenched, but not growing worse – examples include quality of life, loneliness and many measures of health. But on other measures inequality in later life increased. Income inequalities widened over the period, and there is also evidence that opportunities for older workers are becoming polarised, with poorly educated people being much less likely to benefit for the general rise in 50+ employment.

These are just a few minutes’ reflection on a few hours of presentation; they merely scratch the surface. The latest ELSA report, like its predecessors, will be worth returning to for years to come.