Older workers keep jobs as young pay price of pandemic
Sharp rise in unemployment as redundancies hit record high, ONS figures show.
10th November 2020 11:30
by Rebecca O'Connor from interactive investor
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Sharp rise in unemployment as redundancies hit record high, ONS figures show.
The ONS update on employment in the UK published this morning (November 10) showed a sharp rise in unemployment and a record high in the number of redundancies between July and September.
Beyond the headline data were some changes in employment patterns among different age groups and between men and women.
Employment among 16 to 24-year olds is at a record low, falling by 174,000 in work between July and September 2020 to 3.52 million.
By contrast, the number of people aged over 65 who are working increased by 66,000 in the quarter, to 1.32 million.
The figures also showed a record decrease of 99,000 in the number of self-employed women and a record rise in the number of women entering full time employment, up by 165,000 to 8.72 million.
However the ONS said this change in status from self-employed to employed could in part be attributed to people changing the way their work is classified, rather than changing jobs.
Becky O’Connor, Head of Pensions and Savings for interactive investor, said: “Older people past retirement age appear to be choosing to hang on to their jobs or find new work, possibly because of the impact of the pandemic on their retirement pots.
“Young people could be paying for the impact of the pandemic for decades to come. The drop in employment for 16 to 24-year olds is worrying not just for now, but also their career progression, pay and pensions later on.
“The pension contributions you make early in life can have the biggest impact on your eventual outcome in retirement because of the effects of compounding and growth.
“So young people could feel the deferred pain from this period of unemployment in 40 to 50 years’ time.
“The rise in the number of women entering full time employment and a decrease in the number of self-employed women suggests a flight to security, amid measures for the self-employed that have fallen short of help for employees in many cases since the start of the pandemic.
“It’s possible that the ability to work more flexibly and from home has enabled some women to return to full time work.”
“There has been a drop in all types of employment for men, apart from a slight rise in part time or full time self-employed work.”
Figures from the interactive investor Great British Retirement Survey showed that one in five people approaching retirement, aged between 60 and 65, expect to carry on working past retirement age, while one in five 66 to 71-year olds said they would hold on to their jobs.
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