Older people and employment in Scotland: research

Chapter 3: The extension of working life: expectations, motivations and aspirations

3.1 Older people's expectations

Within the sample group of older people there was wide variation in expectations about how long they wished to remain in paid employment. Participants across the age range of the sample group were subject to a range of constraints and opportunities regarding the timing of retirement.

Some participants in their early fifties expressed a wish to retire as soon as possible. For these individuals, remaining in employment until state pension age ( SPA) meant working for longer than they wished to. However, other participants in their sixties and seventies anticipated working indefinitely. Age per se was not a key determinant of participants' expectations, plans or attitudes towards extending working lives. Rather, socio-economic and cultural contexts, health status, and gendered social roles and relationships all interacted to shape individuals' employment experiences throughout their lives. This in turn influenced their orientation towards employment in later life.

This chapter presents key themes in the data relating to people's motivations and aspirations for engaging in paid employment throughout their fifties, sixties and seventies. The analysis considers the extent to which participants' motivations to work were rooted in choice or necessity.

3.2 Positive motivations for extending working life: choice

Around half of the sample group identified a range of positive factors associated with work which motivated them to continue in paid employment.

3.2.1 Intrinsic enjoyment of the job

Nine participants indicated that enjoyment of their work was their main motivation for continuing in paid employment up to, and even beyond, state pension age. They did not necessarily have a fixed retirement age in mind, but rather viewed their employment as being open-ended. These participants tended to be relatively financially secure, and they were aware of being able to choose to stop working when they ceased to derive enjoyment or satisfaction from their work.

Those participants who anticipated a financially secure retirement tended to have more than one of the following sources of wealth: housing which they owned outright and could sell to release equity if necessary; an inheritance from their parents or other relatives; at least one occupational or private pension; and savings that they had built up over time. This meant that their financial security was not wholly dependent on earnings from work. Thus, the ability to choose when to leave the labour market was closely linked to the accumulation of wealth over the life course.

A few participants explicitly rejected the notion of retirement altogether, on the basis that they were doing jobs that they enjoyed and saw no division between their work and the rest of their lives. Although the sub-set of participants who were self-employed was very small, there was some indication in the data that individuals who were self-employed were more likely to view their work in this way:

"Work and life for me kind of overlap. I don't work to earn money to do the things I love to do; I find a way to get paid for what I love doing […] I can continue doing that however old I am" (self-employed female, aged 50)

3.2.2 Positive impact of work on physical and mental health and well-being

Many participants framed their desire to continue working in terms of the positive effects that they perceived paid employment to have on their physical and mental health. Work was viewed as a good way of keeping physically active, and the social contact involved in working was deemed to be beneficial for mental health. Some also believed that the mental stimulation involved in work had a protective effect in terms of preventing the onset of dementia.

Seven of the participants in the sample group were over state pension age. For five of these participants, their primary motivation for continuing in paid employment was the desire to retain a sense of meaning and purpose in their lives. They also appreciated the social contact associated with working:

"To be honest I don't really need to work just now, but I'm doing it for company and for getting a purpose to get up […] when he told me I was going to be part-time I didn't even ask him what I was going to get paid. To be honest with you, I can't remember what the basic salary is." (male employee, aged 70)

Work was also regarded as providing a necessary structure to the day or week. A number of participants claimed that they would return to employment post-retirement if they found themselves getting bored. Indeed, one participant had done just that:

"I think just to keep interested, or to keep a sort of structure in my life. I just feel that if I was left on my own for 7 days a week to work out what I was going to do I would just waste a lot of it" (female employee, aged 69).

For some participants, work was such a strong element of their social identities that it was difficult for them to imagine themselves not working:

"If I'm fit and healthy I want to still keep working. Because I've got a good work ethic and I'm not the type to sit about watching Jeremy Kyle. Sorry, not for me. (female employee, aged 59)

3.3 Negative motivations for extending working life: financial necessity

A third of the older people sample group (including two of the seven individuals who were above state pension age) cited financial considerations as the key motivation to continue working.

This subset of older people indicated that the timing of their retirement would be closely tied to whether or not they had sufficient financial resources to ensure a reasonable standard of living without income from paid employment. Some of these participants were already working beyond state pension age; others anticipated that they would need to continue working beyond state pension age in order to maintain their standard of living:

"Keep some income in the house, make sure the mortgage is paid off, also I don't think my pension is going to be enough to give me a decent standard of living" (male employee, aged 59).

"I think the state pension will be so miniscule that I will have to work […] I think I'll be working till the end" (female employee, aged 55)

3.3.1 Desire to retire before state pension age

Thirty-seven participants were under state pension age. Of these, ten indicated that they would like to retire before they reached state pension age but could not afford to do so, either because they would not have access to any other source of income, or because any private or occupational pension income they might receive would be inadequate to cover household costs. This subset of participants viewed state pension age as their de facto retirement age. From their perspective, they were already extending their working lives beyond what they considered to be desirable:

"It feels a wee bit like an anchor or ball and chain, work at the moment. And it's purely financial." (female employee aged 62)

3.3.2 Loss of access to state benefits

For a small subset of participants, continuing in paid employment was a necessity due to a family member losing access to state benefits. This loss of income from benefits put a considerable strain on household finances, and participants subsequently increased their working hours or sought additional employment in order to enable their household to survive financially. This had a significant impact on participants' quality of life and well-being.

For example, one sixty-year old woman, who worked in a low-paid job, had recently needed to take on a second job at the weekends after a family member (who lived with her) lost his benefit entitlement. At the time of interview, she was working at least forty hours a week, whilst struggling with multiple chronic health problems including diabetes and osteoporosis. When asked how she felt about her work, she said:

"Well, I wouldn't need to get the weekend job if I had more money coming in […] [I feel] angry, very angry. And I get depressed because of it." (female employee, aged 60)

Another female participant, aged sixty-four, retired when she reached state pension age, but had recently re-entered the labour market when her adult son lost his benefit entitlement, which meant that their household income decreased by £400 per month. As a single parent, this participant was unable to rely upon another adult in the household to earn an income, and so she decided to become self-employed:

"I had to think about how I could make £400 a month. Because it's already tight" (self-employed female, aged 64)

3.3.3 Critical life events

Critical life events such as divorce, serious illness, redundancy, bereavement or the onset of unpaid caring responsibilities often had negative long-term consequences for participants' access to financial resources and/or their position in the labour market. Other financial crises, such as underperforming endowment mortgages, also had a long-term impact on participants' finances.

For many participants, such events and circumstances at a previous stage in the life course had limited their subsequent earnings potential, their ability to save, and their pension fund. The data gathered in this study demonstrate a range of ways in which unanticipated life events can increase the necessity to continue in paid employment in later life:

"When my marriage broke up, there was only £2000 left to pay on this house but because he escalated that much debt, I had to basically start again so that's why I'm in this situation, so it's not really my fault […] I would need to work until I'm about seventy-five" (female employee, aged 59)

"I am sixty now […] In 2011, I kind of took partial retirement so I do four days a week […] I had to do that to cash in basically a lump sum and then pay off wife number two" (male employee, aged 60)

It is worth noting that for a small number of participants, negative life events such as the death of a parent, or a serious personal illness had actually led to an improvement in their financial circumstances. This, in turn, had afforded them an increased level of choice regarding the timing of retirement. For example, two participants had been covered by critical illness insurance. They had suffered heart attacks and subsequently received substantial payouts from their insurance companies. This money enabled them to pay off their mortgages, which meant that they perceived themselves to be more financially flexible in terms of retirement planning. A number of participants had also inherited property from parents, which had allowed them increased autonomy over their retirement timing.

3.4 Sufficiency of pension provision

More than half the sample anticipated that their pension income in retirement would be insufficient to meet their living costs. Many participants expressed considerable anxiety about their anticipated pension income:

"Stupidly we haven't got a private pension, so we've only got the state pension, so it does make me think 'would I be able to live in the comfort that I'm used to all my life?' " (female employee, aged 59)

Even those participants who had an occupational or private pension were doubtful that their pensions would be enough to cover living expenses:

"I do not think we will have enough resources to keep us. To pay all the bills. […] I think your whole pension would get swallowed up by council tax […] I just don't know how we're going to do it really" (female employee, aged 51)

Several participants claimed that they would need to continue working, at least part-time, after retiring from their current employment in order to supplement their income. This is explored more in section 3.5.

Interestingly, some of the lowest-paid employees in the sample tended to express the least concern about their pension entitlement; they estimated that their state pension would be more or less equivalent to their current earnings. Their comments indicated that they had become accustomed to living on a low income, and therefore didn't think that losing their salary and instead receiving their state pension would make much difference to their income.

3.4.1 Lack of information regarding pensions

There was a widespread lack of knowledge and understanding amongst participants relating to their own pension provision. Many participants admitted that they did not know how much money they had saved into their pension, or when they would be able to claim their pension, or how much money they would receive out of their pension. Often, participants had a number of different occupational pensions from different jobs, and this led to the sense that their pension provision was fragmented, complex, and difficult to get a handle on:

"My issue is because I've had so many different industries, I've got bits of pensions all over the place that I need to just get my head down one day and pull them together, and find out exactly where I am with them, when I can retire...." (female employee, aged 53)

"I could end up with another 10 jobs before I retire. So I don't want to have lots of teeny weeny bitty pensions that don't actually add up to anything" (female employee , aged 51)

Participants commonly claimed that they did not know how to access unbiased, trustworthy information and advice about pensions. They also expressed a preference for paper-based information resources rather than online resources. Only a handful of participants had arranged a pension forecast or approached organisations such as Citizen's Advice Bureaux or Age Scotland for help with understanding their pension. Several participants expressed regret that they had not invested in a pension earlier in their working lives; it was only now that they were becoming aware of the consequences of their actions in previous decades:

"I made the mistake of burying my head in the sand a little bit and not worrying about the future" (male employee aged 60)

There was very low awareness of Pension Credit amongst the older people, and none of the participants above state pension age were claiming Pension Credit. There are a number of potential explanations for this lack of awareness: it was not relevant for those participants below state pension age; Pension Credit is insufficiently advertised amongst pensioners; those participants above state pension age and in work may have felt that their incomes were sufficient, or assumed that they would not be eligible for any income-related benefits.

3.4.2 Rise in state pension age for women

The rise in state pension age for women was regarded as particularly problematic. There was a widespread sense of successive governments unfairly "shifting the goalposts" for women. This meant that women were required to revise what in many cases were long-held expectations about retirement timing. Many female participants offered powerful accounts of their perceptions of how the rise in state pension age impacted negatively upon their current and anticipated future quality of life and well-being:

"I think it's really unfair to keep people going until….I thought 65 was bad enough, you know […] the way the retirement age keeps getting pushed back […] you want to enjoy it, you know, I've seen so many people who've got to retirement and then died. And you don't want to do that either" (female employee, aged 53)

"I think changing the pension age is ridiculous, I think what they've done to women is absolutely iniquitous" (female employee, aged 66)

3.5 Employment aspirations in later life

3.5.1 Career development

Participants were asked whether or not they had the opportunity to undertake further training and career development in their current jobs, and whether or not this was something that they were keen to pursue. Several key themes arose from the data.

No training opportunities: Participants in low-skilled jobs, such as cleaners and machine operatives, were most likely to indicate that there were no opportunities for them to progress in their jobs.

A lack of interest in career development: Approximately half of the forty-four participants indicated that they were not interested in any form of career development. Most linked this lack of interest to their age and stage in life:

"I think I've reached a stage in my life where I'm more thinking about retirement than I'm thinking about taking on new challenges and whatever." (female employee aged 55")

"I'm not really looking for more training or more responsibility" (male employee, aged 59)

"I'm not looking for progression, obviously at my age I'm not, I'm looking for a job which pays me enough, which gives me structure in my life" (female employee, aged 66)

Internalised ageist attitudes: Many of those older workers who claimed that they were not interested in career development presumed that employers would not be willing to invest time and resources into their development because of their age:

"I think at my age I don't think I would take the chance anyway because if it was me with a company I'd be looking for somebody that's got quite a few years then train them up to do that higher up job because it's going to last. As I say, I've only got five or six years to go" (male employee, aged 59)

"I've reached a point in my working life where I am really looking for a position to pay the bills as opposed to a career, if you know what I mean. I am realistic enough to know that I am 63, nearly 64, and it is fairly unlikely that I am going to be getting a real career type job" (unemployed male, aged 63)

Desire for career development: The participants most likely to express enthusiasm for career development were generally in their early to mid-fifties, educated to degree level, and employed in professional occupations. They recognised that they had at least a decade of working life ahead of them and were keen to use and develop their skills and qualifications:

"I enjoy this job, but on the other side I want to use my qualifications as well, it's nice to work in what you have training for" (female employee aged 50)

3.5.2 Part-time working

A substantial majority of participants expressed a desire to remain in their existing jobs, but work fewer hours as they approached retirement. However, only two participants said that their employer offered reduced working hours as a form of "flexible retirement". Several other participants thought that it was unlikely that their employer would be willing to accommodate part-time working; they envisaged leaving their current job at some point and taking up a different part-time job elsewhere, as illustrated by the following quote:

"I don't know if there would be an option to go part-time […] it's not really encouraged, part-time, and I don't know if that's because, you know, they've got to pay the National Insurance and then a pension for somebody else […] So I could maybe do something else part-time with less money and less responsibility, if indeed there is anything available at that time." (female employee, aged 55)

Those participants who anticipated working beyond state pension age in order to supplement their pension income also expressed a strong preference for part-time, rather than full-time work. On the whole, participants wanted what they often referred to as "little jobs" -i.e. jobs that would provide some income, but without high job demands or responsibilities. The following quote encapsulates this view:

"I think I can probably see myself getting a little job in B&Q or something. No hassle. Just be nice to customers, or Tesco, or whatever, because you see a lot more older people now working in these […] just a part-time job." (male employee, aged 60)

Older people's preference for a "little" part-time job post-retirement clearly links to points made in the previous section relating to a lack of interest in career development within this sample group. It also supports the finding reported earlier in this chapter, that older people's key motivations for extending working lives were to increase income and maintain a structure to the week.

This aspiration for part-time work amongst those participants who had yet to reach state pension age was mirrored by the experiences of the seven participants who had continued to work beyond state pension age. Six of these seven participants worked part-time. It is interesting to note that of these six participants, five had continued to work more through choice rather than pressing financial need. Whilst the income they received from employment was useful, it was not their main motivation for extending their working lives. In light of the small number of participants above state pension age, it is important to be cautious in interpreting this finding.

3.5.3 Unpaid voluntary work as an extension of working life

Several participants claimed that they wished to continue to work in some capacity beyond retirement, even if this was unpaid voluntary work. Underpinning this was a desire to remain active and engaged with the world, and a sense of wanting to contribute to the wider community, as the following quotes demonstrate:

'I never want to be in a position where I am not working in some capacity […] I always want to be involved in something, whether it is a paid capacity or not a paid capacity. […] I never want to be sedentary or idle.' (self-employed male, aged 50)

'If I could afford not to work, I would volunteer at something. Just to keep you busy type of thing. Meeting people and doing that because I think other than that I would become very insular in the house.' (female employee, aged 60)

This positive attitude towards voluntary work in retirement suggests that work, whether paid or unpaid, was viewed by many participants as being good for their physical health and mental well-being. However, one participant, in the context of expressing anxieties about her financial situation in retirement, offered the opinion that older people might increasingly be expected to volunteer in roles that would previously have been paid jobs:

'I do not think we're going to have enough money to live off […] There are local authorities that are expecting people to volunteer to do these things now and not actually get paid to do so. I think that is quite unrealistic. There is this push that there is suddenly going to be all these people volunteering and doing services that have been paid for in the past.' (female employee, aged 51)

Nevertheless, there was a general view within the sample group that as long as individuals were both financially and physically able, voluntary work would enrich their retirement and their engagement with the wider community.

3.6 Summary

There was much variation in what older people considered to be an appropriate retirement age. In addition, participants' views differed widely in terms of how much choice they felt they had over how long they would continue in paid employment.

Half of the sample of older people identified positive motivations to continue in paid work, such as their enjoyment of work and the positive impact of their work on their physical and mental health and well-being. The same proportion of older people also made reference to their financial circumstances when discussing decision making about the timing of retirement. More critically, for a third of the older people sample, financial considerations were a key motivator in the continuation of work. This subset of participants did not wish to work until state pension age, but could not afford to retire.

A key finding from the interviews with older people is the general lack of awareness and understanding of pensions provision, alongside the fragmentation of pension provision for workers who have been employed by a number of organisations over the course of their lives. In terms of employment aspirations in later life, the main theme in the data was that those older people who desired to continue working in later life generally wanted to do so on a part-time basis. Very few participants expressed a wish to engage in career development or further training; those that did were in their early fifties, and already employed in higher skilled and relatively well-paid jobs.