Working longer – the reality ‘behind the headlines’

Senior businessman in office working on laptop

By Heather Cameron

With no shortage of headlines highlighting the record employment rate in the UK, and the increasing number of older workers widely reported, it may seem that the outlook for the ageing workforce is a rosy one. But do these headlines hide the reality?

Recent analysis from Age UK argues that the headline employment rate doesn’t tell the whole story about working longer, “making it an insufficient – and even misleading – tool for public policy decision-making”.

The statistics

The most recent official figures show that the employment rate (the proportion of people aged from 16 to 64 who are in work) is the joint highest since comparable records began in 1971, at 74.8%, while the unemployment rate is the joint lowest since 1975.

Data also shows that the employment rate for people aged 65 and over has indeed increased since the 2008 recession. It is currently at 10.4%, up from 7.3% in 2008.

Age UK has also recognised the increase in employment rates for older people, noting that, in fact, the older the age group, the greater the increase in employment. However, the average number of hours worked has declined since the recession, indicating a more complex and perhaps less reassuring situation than the one portrayed in the media.

The biggest drop was for 50-54 year old men, whose average hours declined by 29%. For men aged 60-64, the average number of hours declined by 8 hours (over 22%), while women aged 50-54 experienced a fall of 18%.

The only age group not to see a decline was women aged 60-64, which is likely to be as a result of the raising of the State Pension age.

Choice or necessity?

The change in the State Pension age was justified on the grounds that it gave people more choice and more scope to continue working if they wished to.

A recent CIPD survey found that the most common reason for wanting to work past 65 is that employees believe it will help keep them mentally fit, followed by wanting to be able to earn a sufficient income to continue to do the things they enjoy.

As Age UK suggests, it may be that the reduction in working hours is a good sign if it is due to older workers choosing to wind down their hours, maybe to enable them to juggle other responsibilities such as caring for their grandchildren, while still earning a wage.

However, the research suggests it may be less through choice and more as a result of the changing labour market such as increasing underemployment (working less hours than they would choose to) or increasing insecure working practices driven by the rise in self-employment and the ‘gig economy’.

As it is likely working fewer hours will mean less income, this could be a cause for concern since it will be more difficult for older workers to maintain their standard of living until they meet the State Pension age and for them to save enough for retirement.

Another issue highlighted by the CIPD, is that most employees don’t believe their organisations are prepared to meet the needs of the over 65s, suggesting that there is a need for employers to also review their practices in terms of managing older workers.

Final thoughts

It is clear that while, for some, choosing to work beyond the traditional retirement age will be a lifestyle choice, for many it will be a necessity. Any substantial reduction in working hours for these older workers could consequently pose a real issue.

It would therefore make sense for policy makers to heed the warning from Age UK not to rely on the headline rate of employment for older workers, and rather look beyond it to the reality of many struggling to get and keep the secure, well paid jobs they want and need.


If you enjoyed reading this, you may be interested in reading our previous post on the pros and cons of the gig economy.

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Zero future for zero hours in a fair economy?

By Stacey Dingwall

The Office for National Statistics (ONS) has released its second annual update on the number of people employed on zero hours contracts, which suggests that in August 2014 UK firms were employing 1.8 million people on such contracts.

What is a zero hours contract?

According to Acas, the term ‘zero hour contract’ (although not defined in legislation) can be understood as “an employment contract between an employer and a worker, which means the employer is not obliged to provide the worker with any minimum working hours, and the worker is not obliged to accept any of the hours offered”.

Use of the contracts has been a highly controversial issue in recent months, with high-profile retailers such as Sports Direct (who employ 90% of their part time staff on zero hours contracts) coming in for criticism of their “exploitation” of their employees. The sports retailer is also facing legal action from hundreds of their workers due to their exclusion from the company bonus scheme, thanks to the nature of their contracts.

Increasing or not?

The ONS’ first Analysis of Employee Contracts that do not Guarantee a Minimum Number of Hours found that between January and February 2014, 1.4 million UK workers were employed on zero hours contracts. Despite the inevitable headlines depicting the new figure as a direct increase from the 2014 analysis, the ONS was careful to warn against this in its latest analysis, noting that it covers a different time of year than the first release therefore the number of contracts reported may be affected by seasonal factors.

The latest release also includes data from the Labour Force Survey (LFS), which indicates that the number of people employed on zero hours contracts in their main employment, between October and December 2014, was 697,000 or 2.3% of all people in employment. The figure for the same period the year before was 586,000 or 1.9% of people in employment although again, the ONS are careful to stipulate that they can’t be certain how much of this ‘increase’ is due to greater recognition of what constitutes a zero hours contract, as opposed to new contracts.

The Economic Research Council suggested that a lot of the jobs that have been created recently have come with much less security and guaranteed pay. And the UK Commission for Employment and Skills have noted that 33% of people on zero hour contracts would like to work more hours (either in their current job or in a different one), compared to just 13% of people not on a zero hour contract.

Zero hours and the general election

The issue of the use of zero hours contracts looks set to become a key feature of parties’ campaigns in the upcoming general election. Current Secretary of Business, Innovation and Skills – Liberal Democrat Vince Cable – has already put forward legislation (clause 151 of the Small Business Enterprise and Employment Bill, currently before the House of Lords) which would see exclusivity clauses in contracts (which prevent those employed on zero hours contracts from seeking additional work to supplement their income) banned.

The Conservative Work and Pensions Secretary, Iain Duncan Smith, has however defended the contracts, arguing that they “provide people with a flexible way of working and the freedom to arrange jobs around other commitments” and “allow employers to be competitive in response to market trends”.

What of the other parties? Labour has vowed to “end exploitative zero hours contracts” and introduce “new rights” to employees on such contracts, however has stopped short of proposing to ban employers from offering them altogether. Somewhat embarrassingly for the party, figures released by the Independent Parliamentary Standards Authority (IPSA) and seized on by the tabloids, have indicated that over 30 Labour MPs employed staff on zero hours contracts in 2014.

The Green Party is firmly against the use of zero hours contracts altogether: leader Natalie Bennett has been calling on the government to place an outright ban on them since 2013. UKIP leader Nigel Farage has also criticised the long-term use of zero hours contracts by employers, and has called for large employers to be subject to a code of conduct as to how they are applied.

Zero hours contracts aren’t a financial necessity

In these times of budget cuts, many local authorities have argued that they have no choice but to offer some of their workers zero hours contracts. One area in which this has been particularly prevalent is in the provision of social care, with some employees paid on a ‘time and task’ basis, i.e. only for the amount of time they actually spend with a client, which can be as little as 15 minutes in some cases.

In 2012, Southwark Council took the decision to move away from this approach, after feedback from care workers and service users indicated that it did not allow workers to carry out their duties with the required level of compassion. The Council carried out a review of their homecare services and found that extending the length of visits greatly helped in keeping service users healthy in their own homes and out of hospital and residential care. It also noted that the costs of providing longer visits had been ‘passed on’ to their care workforce over time through the use of zero hours contracts and, wishing to end this, announced that from October 2014 they would be eliminating their use altogether, and offering guaranteed hours of employment to their staff.

Immediate reaction to the release of the latest figures has been plentiful; it now remains to be seen whether it is reflected in party campaigns in the forthcoming general election.


The Idox Information Service has a wealth of research reports, articles and case studies on zero hours contracts and other employment issues. Items of interest include:

The decent jobs deficit: the human cost of zero-hours working in the UK

Give and take? Unravelling the true nature of zero-hours contracts

Zero hours contract: not all bad news

Zero-hours contracts: myth and reality

Flexibility or insecurity? Exploring the rise in zero hours contracts