Dr Emily Andrews and Naomi Clayton.

Q66 The Chair: Welcome to the Economic Affairs Committee’s fifth evidence session of our inquiry on preparing for an ageing society. We are delighted to welcome our two expert witnesses: Dr Emily Andrews, the deputy director for work at the Centre for Ageing Better; and Naomi Clayton, the chief executive at the Institute for Employment Studies. Thank you both very much for coming today; we are really glad that you are here. The session is being broadcast live on parliamentlive.tv. A full transcript will be taken; we will share it with you shortly after the meeting so that you can make any corrections you feel are appropriate.

Can I start by asking you a general introductory question? I will start with Emily then go over to Naomi. In our sessions so far, we have heard a lot about the over-50s; there is a lot of interest in that group. Which trends in the employment of over-50s in the UK would you highlight as being of note? In particular, are there any striking statistics that characterise the employment rate or character of employment of those groups that you would like to bring to our attention?

Dr Emily Andrews: The key trend is that employment rate growth since the millennium, particularly since the recession or the financial crisis, has been driven by this group. The employment rate among 50-to-64s has risen enormously since 2000: it has gone up from around 60% to approaching 72%, which is a huge increase. The number of over-65s in work has tripled since the millennium.

The first trend I would like to highlight is that this change has happened in the workforce. We have already experienced this massive amount of change. The increase has happened among men, but the increase has been much bigger among women. It is interesting to think about what is driving this. There is definitely something around health generally. For women, there is the rapid equalisation of the women’s state pension age. There is also a cohort effect here. We had a generation of women moving into their 50s and 60s who were just more attached to the workforce anyway. This is maternity policies feeding through; they are more likely to be in work than their mothers or grandmothers were. That is the high‑level picture.

You know, I assume, that there are some problems with the Labour Force Survey, so the question about what has happened in the short term is a little more uncertain. It seems that the pandemic has somewhat put the brakes on that growth. The gap in the employment rate between under-50s and over-50s is now wider than it was on the eve of the pandemic.

We need to remember that there is a huge amount of variation underneath that. While we have seen a lot more people working for longer, there are also people who are not working for longer. There is big variation by gender, ethnicity, employment history, geography and, of course, age. That is the other thing: the 50-to-64s, or the 50-to-70s, is a hugely varied group. While we have seen this big climb in employment over 50, among the over-60s, employment is still pretty low. In fact, it falls below 50% by 64. With the state pension age reaching 67 by the end of this Parliament, that is something we cannot take very lightly.

You asked me about the striking statistic. For me, the most striking statistic is that, among the over-25s, the highest rate of adult poverty is among people aged between 60 and the state pension age. Contrary to what we hear about this being a gilded generation—of course, there are very many wealthy people who are older—there are high numbers of people, almost one in four, aged 60 to state pension age who are in poverty. That is the group who most need to keep working but may face the greatest challenges in doing so.

Naomi Clayton: We would note very similar trends. First of all, we have seen a reversal of these longer‑term trends. There has been a reversal of the increase in employment rates for people in their 50s and 60s. Three-quarters of all employment growth since 2000 was explained by people over the age of 50.

Noting some of the issues around the Labour Force Survey—we have to be cautious when we are looking at some of those shorter-term trends—it appears that this trend has stalled since the pandemic. In the last five years, employment for older people has stopped growing for the first time since the 1990s. Around three-quarters of the total growth in economic inactivity has been among people aged 50 and older—at least, that is what the statistics estimate—with nearly 1 million fewer over-50s in the labour market since the pandemic started. We estimate that around 500,000 people aged between 50 and 64 would like to work but are not currently actively participating in the labour market. From wider research, we know that just one in 10 older people get support to find work each year. We have seen a reversal of the trends that we saw in the 2000s.

It is worth touching on some international comparisons and how the UK compares with international counterparts. We have wider employment gaps for older people compared to other countries. We are mid-ranking in the international tables for employment rate gaps. If we moved from the estimated current position up to the top quarter of countries that have the lowest employment rate gaps, we would see around 350,000 more older people in work, so we do fall behind some of our international comparator countries. In many countries, people with limiting health conditions—particularly older people with limiting health conditions—have better employment chances and, over time, we have seen their employment outcomes improving. The data from the UK suggests that that has not happened in the UK in the same way. We have not seen those improvements.

There is one last point that I would make around the trends for older workers. As Emily has already said, people over the age of 50 are making up a growing share of the workforce over time. In future, as that boom generation of people in their 50s and 60s becomes older and we see a lower birth rate and lower immigration rate, we are likely to see a smaller and older working population in the future.

The Chair: Thank you very much. That was an excellent introduction.

Q67 Lord Agnew of Oulton: The question that they have given me to ask you has already been answered in our briefing notes, unless you disagree with the statements that the main motivators back into work or to extend work are the need for money or because there is stimulation from what you do. Those seem very obvious to me.

I am particularly interested in health. We have heard about this from previous witnesses. Emily, you were saying that there are huge disparities in geography, gender and so on. What about health? If we are to try to do anything and to recommend that we get more people working—I was interested in your comment about what I would call the dead zone between 60 and 67—for me, it is about health. Can you tell me whether I am right or not?

Dr Emily Andrews: You are and you are not. Health is the main driver for people in this age cohort to move out of the labour market involuntarily. Half of everyone who is economically inactive due to health, which is what everyone is terribly worried about at the moment, are over 50 or aged 50 to 65. They make up one-third of the workforce and half of the people who are economically inactive due to health.

We looked at the numbers on this. When the new Government came in, I was very aware that there was a lot of rhetoric and discussion around health and what we were going to do to support people with long-term health conditions to remain in work or return to work. There seems to be an underlying argument that doing that will solve 50-plus employment—that is, if health is the main reason why people are out at this age, then, if we make work more accessible, have better return-to-work policies, do more job carving and have more part-time jobs, that will in itself increase the 50-plus employment rate.

Our analysis suggests that that is not quite right. There is an age effect that, in essence, compounds the health effect. The disability employment rate gap—the gap in the employment rate between people who have a long-term condition and people who do not—is higher over 50 than under 50. That does not prove there is an age effect going on; it could just be that you are more likely to have more complex health conditions as you get older and this just reflects that. However, when you look at the number of people reporting whether their conditions are work-limiting, there is not much of an increase over 50, which suggests to me that there is an age effect that is layering over that health effect.

My contention—we will talk more about policy recommendations in a moment, I am sure—is that it is really important that we have a response to supporting disabled people to access good work. My goodness, we are wasting talent in this country. If we do that by itself, and we do nothing to think about making sure that this works for people in their 50s—and, in particular, those in their 60s—it will leave that group behind.

Lord Agnew of Oulton: Naomi, what is your thinking on this?

Naomi Clayton: The evidence suggests that ill health is the most common reason for people in their 50s and 60s being out of work. Health is often not the only reason why somebody is out of work. Often, there are multiple factors behind whether somebody is choosing to work—or has had to leave work, where it has not been a choice. We know that redundancy, lifestyle choices and caring responsibilities all impact and combine when somebody makes a decision about whether to work or whether they can work.

We also see a fair amount of variation according to the type of job that somebody does or the type of occupation that somebody works in. We know that physically demanding work is one of the most important predictors of whether somebody leaves work for health reasons. In the pandemic, we saw some quite significant differences in the reasons behind people leaving the labour market. Men in well-paid professional occupations were far more likely to choose to retire early because, financially speaking, they were able to make that decision, whereas people in lower-paid occupations, which may well be more physically demanding, would often leave the labour market for health reasons.

It is often a combination of factors. There are also differences according to the type of jobs that people do, as well as the type of jobs that people can access. I am sure that we will come on to this but access to flexible work is a big factor in whether somebody can choose to stay in work or return to work. Access to flexible working is hugely valuable for many people, especially those over the age of 50.

Q68 Lord Turnbull: There are two narratives here that appear to conflict. One of them is that the average age at which people leave the labour market is getting later; the other is from a chart from the Centre for Ageing Better about employment rates at particular ages. It is very striking that 80% of people aged 50 are still working; that then drops to 20%. It is now slightly higher. How do you reconcile these two things? People are retiring later, but we are not yet seeing a big impact in filling this gap between the 50s and the drop thereafter. This is a target area. We are trying to get more of those people into work.

Dr Emily Andrews: The Institute for Fiscal Studies did some work, which we funded, a few years ago; it looked specifically at the increase in the state pension age from 65 to 66. It showed that there has been a sort of smoothing. Where we used to have a big spike in retirement at state pension age, there is now a bit of a bump, but the transitions on either side of it are basically much more even.

Historically—very short-term historically, not long-term historically—the people who have worked for the longest are wealthier and healthier, weirdly. What kind of job do you want to do when you are older? You want to do flexible jobs, such as a bit of consultancy work where you are invited in for your expertise. Those are very white-collar jobs that, generally, people who could probably afford not to work can access.

My concern is that we are now seeing the very under-pensioned Gen X coming through. Perhaps that is a bit of a strong term but, certainly, Gen X does not have lovely defined benefit pensions, and auto-enrolment kicked in quite late on in their working lives. This says to me that, in future, we will see more people in that 60s group working because they have to. The increase in the state pension age did have a statistically significant effect on the propensity of 65 year-olds to work, but from quite a low base. We have a long way to go. Does that answer your question?

Lord Turnbull: Yes. The answer is that we are going to fill in the non-working 65 year-olds, but it is not going to happen all that quickly.

Dr Emily Andrews: No. We have a lot more to do to the labour market and to workplaces in order to make that happen.

Naomi Clayton: I would just add to that. We have talked about the importance of access to flexible work. People who are in greatest need of working longer for financial reasons are often the least able to access flexible work. People who are working in caring, leisure and other service occupations are the least able to access flexible forms of work. There is certainly an issue there in terms of equality of access to flexible working.

Dr Emily Andrews: That is potentially why self-employment is so high among this age group. On the one hand, that is potentially good, but what worries me about self-employment being high among this age group is people who would rather have the security of employment and a job not being able to get one due to ageism in recruitment.

Q69 Lord Petitgas: I want to rebound a bit on Lord Turnbull’s point. In some of the earlier presentations we have had, there has been a bit of hope that all these silver cohorts will provide a boost through their ability to work longer, et cetera, which will therefore somehow delay or cushion some of the issues that we have with the demographics. My sense is that you have said, “We had the big boost before the pandemic and, since then, if anything, it has worsened”. Is it fair to think that the upside potential of these cohorts to work longer as we go forward on this curve is limited? We have maxed out unless something happens: we give people real flexibility; we find better drugs to keep them going; or those who are not capable of doing consulting can somehow adapt. That is what it feels like to me.

Dr Emily Andrews: It is fair to say that the stuff that was going to happen by itself has probably already happened. It is now time for active labour market policies. Over the last 10 years, we have had moments of interest in this issue but much less actual policy activity, other than the increase in the state pension age, which is a big lever that the Government could pull. It is effective, but that effectiveness will run out as it gets older. When the state pension age went up from 65 to 66, the rate of absolute poverty among 65 year-olds doubled. People just eke out another year if they are not currently working. If someone is still working before state pension age, they just do another year, but most people are not working at that age.

Q70 Lord Blackwell: I would like to come on to some of the policy implications in a minute, but, before I do, I want to follow up on this point about the analysis. You said that there are often multiple reasons why people leave the workforce but, in principle, you could put the people who have left the workforce before retirement age into three buckets. One is simply unemployment. They have lost their job and cannot find another one: “I want to work, but I can’t find another job”. Secondly, they could be ill and unable to work because they are sick or disabled. Thirdly, it could be voluntary: they have chosen early retirement as a lifestyle option. Can you, in any crude way, put people into those three buckets and tell us what the proportions are?

Dr Emily Andrews: Yes. Let me see if I can do the numbers; you can correct me if I am wrong. You have missed one bucket. On the reasons why people aged between 50 and 65 are out of work, around 6% are unemployed; around one in three are retired; around two in five are out for health reasons; then another one in seven are out due to caring responsibilities. I wonder how many of you know people who have retired early but health is really the reason why they have retired. If you can afford to leave the labour market and your health is failing, you describe yourself as retired. If you cannot afford it, you say, “I am out of work for health reasons”. That is your broad picture; this is how I would look at it.

Lord Blackwell: The one in seven for health reasons could be either people who are unemployed but then find that they are better off on sickness than unemployment benefit or people who have chosen to retire for sickness reasons. It is interesting. You are saying that only about one-third are retiring voluntarily.

Dr Emily Andrews: Yes. Caring responsibilities comes under “looking after home”. Some of those people might choose to be out. Broadly speaking, if people say they are out for health reasons, there is a sense that it is involuntary. Unemployed people are those who are looking for a job and, if they are in the benefits system, have been judged fit for work.

Lord Blackwell: My second question is about this drop in the employment rate from 80% down to 30% between the age of 50 and retirement age. You said that it has been going up partly because women in this group were not in the labour market in such numbers, which pushes the numbers up as they work through. If you isolated men out of this group, is it still true that the number of men working longer is going up?

Dr Emily Andrews: Yes. The employment rate for men aged 50 to 64 has gone up, just not by as much as women.

You missed one thing in your buckets. It is interesting: when you said, “buckets”, I was like, “I wonder whether they are the same as my buckets”. I put the barriers to work in this age group into two buckets. There is a set of practical barriers that are not inherently age-related but happen to cluster at this age, such as having a caring responsibility or a long-term health condition. That can happen to anyone at any age.

Again, there is an argument that you can do things about that. You can create paid carers’ leave and give carers a right to return when they have to go through a period of sorting out their parents and all that stuff. If you do that, will that be enough to lift the boats and increase 50-plus employment? To an extent, yes, but it misses out the other set of barriers, which are attitudinal.

One, which I believe we want to talk about, is ageism. That includes ageism towards us, which is huge, and internalised ageism: “I can’t do it. I don’t deserve it. A younger person should have this job”. There is also what I call a paucity of imagination around what the decade of our 60s really means. People still base their understanding of their 60s on their parents and grandparents. This affects how they treat other people in the workplace and their own expectations for themselves.

Lord Davies of Brixton: I do not quite get the difference between the last two: the internalised ageism and the lack of imagination.

Dr Emily Andrews: They are not fully distinct. I added paucity of imagination only quite recently but there is something around people thinking, “Oh, that’s odd”, rather than, “No, you shouldn’t be here”, or, “Obviously, you don’t want this opportunity”. It is a kind of benign ageism, I suppose. You are right. I would be very happy to call it all ageism.

Lord Blackwell: If I take unemployed people, what barriers do they face in getting jobs? What, in policy terms, might one do to address those?

Naomi Clayton: When we are talking about factors and buckets, I would caution against trying to oversimplify things. As I was saying, people often face multiple barriers and have multiple things going on in their lives that affect their ability to work and the decisions that they make around work. When people cite ill health as the reason why they are not participating in the labour market, it is normally the main reason, but there are others that work alongside it. Employer behaviour and practice can also compound the impact of some of those things. It is really important that we look at individual factors and the job-related employer factors, too.

Lord Blackwell: Presumably, some of the people whom we would class as retired in my buckets may have taken voluntary retirement because their employer offered that and they would not otherwise be retired.

Naomi Clayton: Yes. There may be a number of decisions behind that relating to how they feel about work and how they are treated at work. We know that older workers, for instance, are more likely to report not receiving support from their managers. That can be particularly important when you are trying to manage a health condition, whether it is a physical or a mental health condition.

On the individual factors, I would add skills and qualifications into the mix. A significant number of older people—it is estimated at 6 million—have difficulties with numeracy and literacy, which can impact their employment outcomes. Skills and qualifications are definitely part of it.

Emily has already talked about ageism. That is the most common form of discrimination within the workforce, but, when employers think about their policies with regards to diversity, equality and inclusion, they do not necessarily think about age as part of that. Ageism is a big factor alongside the support that people are getting in work.

The flipside is that, if we can get these things right, access to good work can be protective of people’s health; I just want to emphasise that.

Dr Emily Andrews: On the unemployment point, Naomi has already picked up on this, but we know that only one in 10 people who are out of work in this cohort access back-to-work support. When they do, the outcomes are much worse. Only one in five people over 60 on the Work and Health Programme got a job.

When you read evaluations of back-to-work support, it is so depressing. There is a sense of, “Obviously, the over-60s did worse on this programme. That reflects labour market conditions”. We can shrug our shoulders about that but, if we do, we cannot increase the state pension age. Those two things are not compatible with each other.

In the support that we offer people who are unemployed to get back to work, we need much higher standards for this group. We know that there is still a bit of a tendency in some places to park people. These people are seen as harder to get back into work, so people who are target driven are therefore less inclined to support people in their 50s and 60s.

I know that we want to talk about international examples but, internationally, in the programmes that have been successful at supporting unemployed people in their 50s and 60s back to work, employer engagement is hugely important. On the one hand, it is about actively selling older workers to employers generally; that is something we do at the Centre for Ageing Better through our Pledge. On the other hand, there is an individual brokering point. In general, this is something that our employment support system is not good at the moment. There are pockets of good practice but the jobcentre is pretty underpowered when it comes to employer engagement.

Lord Blackwell: It would be interesting to know what proportion of this group initially leave the employment market because of the action of their employer, in terms of redundancy, as opposed to people who initially leave the labour market because of their own choice.

Dr Emily Andrews: I do not know that number. What I do know is that people who are made redundant at this age are the least likely to return quickly to work. Of course, it is a quick return to work that is so important.

Q71 Lord Liddle: Following up on that point, this is anecdotal but I was a Cumbria county councillor in the 2010s. It was an era of austerity and budgets had to be cut. Our workforce went down from something like 10,000 to 6,500. Most of that was achieved through early retirement deals for people who decided they could afford to retire. What about the future? That kind of final salary retirement provision is eroding fast. Will the option of taking early retirement as a result of job losses decline in future?

Dr Emily Andrews: I would expect so. People who are not on defined benefit pensions are aware of the need to keep working for longer. Some people who are not on defined benefit pensions know that; some people do not.

Local authorities are interesting. We have 500 employers in our Age-Friendly Employer Pledge network, which is a free programme that we run. One of the most represented sectors is local authorities. It is not that difficult to convince most local authorities on this agenda. That is generally not from a recruitment perspective. It is about who they have: “Gosh, we’ve looked at the numbers. Loads of them are over 50. How are we going to make sure we do this well? How are we going to make sure we do the best we can with this demographic? How are we going to keep hold of the skills? How are we going to make sure that people are still developing?” That is a very different mindset to retiring people off. It is a good point.

Q72 Lord Verjee: It seems to me that a lot of unemployment at older ages is caused because it is much cheaper to hire a younger person. When you make someone redundant, you lose him or her completely. Is there any policy that we should be looking at to encourage keeping older people in the workforce? Should we subsidise it? Sometimes, we subsidise youth employment. In my business, it is much cheaper for me to employ, rather than an older person, a much younger person with the same skill level although maybe not the same experience level. Are there programmes we should be thinking about to facilitate older people staying in the workforce?

Dr Emily Andrews: I always find it odd when people say this to me. I have spent most of my working life in the charity sector. Prior to that, I was in the public sector, where it is more of a thing that people get more money as they become more senior. You pay people for the job they do. That is within your gift. In my team, the oldest person and the youngest person—the oldest person recently turned 70; the youngest person is in their early 20s—are on the same salary because they are at the same level. We are asking them to perform the same responsibilities, or the same level of responsibilities, but they are doing them in different ways. As you are in the private sector, you will know much more the complexities around that.

I am very keen on a Kickstart for older workers. If you reinvested just 3% of what we are saving by increasing the state pension age, you could fund 40,000 places on a Kickstart-style programme for the over-50s. They are currently trialling something like this in Northern Ireland. To me, that kind of intervention would tick a lot of boxes. That would not be for retention but to help people return to the labour market.

In all the co-design work that we have done with people who have been out of work for a while, we always hear that people really want job trials. As we get older, if we are going to shift into doing something new, we need to experience ourselves into it. Job trials really help us to do that. That also pushes through the inherent ageism on the part of the employer about what they think a worker looks like. Part of this is about the assumption across the labour market that we pay people for the job they do.

Naomi Clayton: There is something around the role of positive campaigns. We have seen examples of this internationally. The Netherlands, for instance, has run a very successful campaign around the positive reasons for retaining older and more experienced workers. When it comes to retention, there is something around working with employers to raise awareness and change attitudes.

There is also something around supporting employers to adopt more of the practices, including flexible working, that enable older workers to stay in work and enable employers to benefit from older workers staying in work.

Q73 Lord Burns: I would like to move on to the question of how well placed the different segments of the over-50s are to deal with automation and the digitisation of the economy, including the advance of AI. Looking at the experience of my family, the 50-to-55s—or maybe the 50-to-60s—were the first generation to be brought up with the internet and computers at home, which means that those who are in the over-60-and-beyond segment become even more challenged. They have a group of people coming behind them who are a good deal more digitally literate than they are. Is there a very stark contrast between these different parts of the over-50s group? What can we do to help people along this track?

Dr Emily Andrews: You are right to segment it. While most people who are not digitally literate are older, that does not mean most older people are not digitally literate, if you see what I mean. You are right. It is a really important distinction.

Within individual workplaces, we always encourage reverse mentoring with the employers we work with. That is where younger and older workers are on a kind of buddy scheme, so that the older worker has someone to ask, “Can you explain to me again how I save the thing in the thing?”; the younger worker can ask questions as well. Emphasising the reciprocal nature of that and making it explicit, so that no one thinks they are a burden on anyone’s time, is really important.

From everything I read about automation and AI, you should not listen to anyone who tells you that they know what is going to happen, but—I am now going to do that—the research suggests that AI in particular is going to impact white-collar jobs. It is going to be about integrating those tools into white-collar knowledge work in order to save time and do things more efficiently.

The key skills that you are going to need to be a white-collar operative in that AI-enabled world are problem-solving and prompt engineering, which is about knowing how to ask what you want from it and how to judge whether what it says is right. All of the people skills stuff, such as people management and strategic thinking, is what matters, and those things develop with age.

On digital inclusion, it is really important that we learn the lessons of the huge amounts of technological change we have already had in the workplace and make sure that people are supported, but, when it comes to the specific changes that will happen due to AI, we really need to worry about what it is going to do to the newer entrants to the workforce.

Naomi Clayton: When you hear very specific forecasts or projections around AI, you should take them with a large pinch of salt. As AI changes the world of work, it is going to displace some jobs and lead to the creation of new jobs in much the same way as technology has been changing the world of work for a long time.

A larger number of jobs are going to be augmented rather than replaced. It is about what it does to the skills that people will need in work. As Emily says, we are seeing a greater need for creativity, critical thinking, problem-solving, team working and resilience—all skills that get developed with work experience over time. There is a real question about how you make sure that young people are being given chances to develop those skills, which older people might have had more opportunity to develop over time.

One of the challenges that older people may face is more job-specific training, as skills needs and job roles change. Older workers are less likely to receive job-related training, which is an issue in general. Through our work with older people and the research that we have done, we often hear that older people would prefer to access work-specific training rather than more basic digital skills training.

There is an issue in terms of access to training opportunities full stop, which relates to public investment in adult education and employer investment in training. We have seen that fall over the longer term. There have been quite significant drops in employers investing in training and quite significant inequalities in access to training, with older workers less likely to receive job-related training.

Lord Burns: One’s instinct is to think that, if you are going through a period of rapid change, it is the older people, who are more resistant to that, who are going to be most disadvantaged by it, in a sense. You are making the argument, which I find quite compelling, that they have already been subject to and have seen change in the past in their lives; and that, in any case, many of the skills that they have developed are going to continue to be relevant in the wider workplace.

Dr Emily Andrews: Yes.

Lord Burns: Are we suffering prejudice from the word “go” because of the thinking that the older generation is going to be less adaptable?

Dr Emily Andrews: We have to make sure, as Naomi was saying, that this lack of access or instinctive passing over of older people for training does not happen. There is some evidence that AI training or training in using AI tools is less likely to be offered to older workers. That is coming out internationally. Again, it reflects the pattern of training in general. We have to be careful with that. Is this going to change day-to-day work more than email did? We have been through this before.

Lord Burns: It is easy to look at this in a very static way. If we are going to go through a period where there is a real shortage of labour and a real shortage of people to fill the jobs that we want, the need for people is going to change the way in which employers face up to this. In mid‑Wales, for example, which I know well, where you have a rather older population, I notice a much higher proportion of quite elderly people on tills and suchlike in supermarkets. The shortage of people in the labour market is forcing people to take on people whom previously they might not have done and give them suitable training.

Dr Emily Andrews: Some of the most enthusiastic members of our Pledge network are in the hospitality industry, which is facing skills shortages. They want to know how to recruit people who are 50-plus.

Naomi Clayton: There is a greater imperative on employers to act, to do things differently and to invest in training because of the changes that we are seeing in the labour market, with the smaller workforce and with significant skills shortages.

Lord Burns: In that sense, there are some public policy issues, but there is also a realisation that employers are going to have to face up to this. They are going to have to change their behaviours if they are going to operate successful businesses against this background.

Dr Emily Andrews: Again, what is so interesting is that the change has happened. There are employers who have woken up to this and who have got ahead of the curve, and there are employers who have not. It is going to be interesting to see what happens to them.

Q74 Lord Londesborough: Good afternoon. I want to follow up on Lord Blackwell’s question and look at the Government’s policy options. Looking at the UK, 65% of the 55-to-64 age cohort are in employment. There has been progress over the last 25 years, but the progress appears to have stalled since the pandemic. Naomi, you mentioned the Netherlands. The Netherlands has a 75% rate, as does Switzerland. Iceland, which always seems to be a bit of an outlier, is at 81%. That is a significant gap.

Bearing that in mind, the question I have here says, “What is the Government’s primary consideration?” That is a bit binary. I am going to ask you to rank the policy options; we are going to use buckets again. The first is health; the second is skills and retraining; and the third is general employment practices, such as employer engagement and flexibility. How would you rank those three buckets? What is going to move the needle at the rate we need in order to go from 65% to 75%?

We should also bear in mind that the Government have stated very publicly that the overall economic activity rate across the whole working-age population is to go up from 75% to 80%. That is bringing 2 million people into employment. It is fairly clear to me that, if we do not address the over-50s or the 50-to-70 brigade, there is no chance of that national statistic happening. Perhaps I will start with you, Naomi, in terms of your expertise in employment. How would you position those three areas in terms of government policy?

Naomi Clayton: That is a great question—and quite a difficult one to answer, in many ways, because all of these things are interdependent. We know that health is the biggest reason why individuals are out of work. It is one of the biggest barriers. The Government have recognised this and recognised the importance of the NHS and the wider health system.

It is interesting that, prior to the pandemic, employment rates for people with health conditions were improving. This suggests that there is more that can be done in other areas. For me, one of the most significant issues is employer practice. We have already talked about the impacts of ageism and age discrimination in the workplace. We have talked about the importance of access to different forms of flexible working. Within that, too, are recruitment practices and job design. All of these things really matter to whether an individual, particularly an older individual, is able to stay in work or, if they have moved out of employment, to return to work. Employer attitudes and behaviours are incredibly important.

Lord Londesborough: Does that require government policy? I am mindful that we have the Employment Rights Bill going through this place at the moment. Clearly, it is the private sector that has by far the greatest impact, since it employs 75% to 80% of the workforce. Is this a cultural issue as much as anything in trying to get employers to reappraise the workforce and see the opportunities in terms of hiring the old, or does this need to be dictated through employment law? Is it a combination?

Naomi Clayton: It is a combination. It is about making sure that there is a sufficient floor in terms of employment rights; obviously, work is ongoing on that. Work is also ongoing to assess the impacts of the current proposed reforms. Within that, we need to review statutory sick pay, because that has an impact on somebody’s ability to return to work and on their health.

Lord Agnew of Oulton: What do you mean by “review”?

Naomi Clayton: Review the level.

Lord Agnew of Oulton: Up or down?

Naomi Clayton: Up, because it is relatively low at the moment.

Lord Londesborough: By international standards?

Naomi Clayton: Yes. Alongside legislation and employment rights is work to change employer behaviours and attitudes, which is why we have suggested that the Government get behind the age-friendly campaign that the Centre for Ageing Better is leading.

I would extend it to skills, too. We have talked a bit about skills and the importance of access to training in enabling people to progress in work and to stay in work but also to return to work. One of the big issues is that, yes, we have seen falling public investment in adult education and skills, but we have also seen really significant falls in employer investment in training. That needs to be addressed. There is a positive move in terms of flexing the apprenticeship levy and enabling employers to invest in different forms of training through that; this is particularly important for older workers because apprenticeships are not always the appropriate form of training, particularly for older people. I would extend employer-facing government policy to skills as well as to employment practices.

Q75 Lord Liddle: Do we not need a sort of separate charter of grandparents’ rights? The needs of grandparents are different from those of parents. For instance, you would like time, at your request, to be able to go to a medical appointment, which, as a grandparent, you are far more likely to have than other people. You would want time to be able to get off work if there was a crisis involving looking after a child in the family, where you had to substitute for the parents for some reason or other. You would possibly want more holiday time that was unpaid. Should we not be thinking more radically about what kind of rights people of my generation would want to have in order to encourage them to continue working?

Dr Emily Andrews: I absolutely agree that we need to think more radically about the different forms of care that people are doing at this stage of life. For some people, that is looking after grandchildren. For some people, that is looking after their parents. For some people, that is looking after their spouse. The point is that caring is a key part of this stage of life. As you say, we have unpaid carers’ leave. We need to move towards paid carers’ leave. There were some interesting recommendations made by the Joseph Rowntree Foundation in the last couple of years around a right to return after a period of care modelled on maternity leave. In particular, if you have to look after a parent who is very sick, such as a parent with dementia, sorting out social care can sometimes take a long time. The ability to have a period of time off when you know you can return to work afterwards would make a real difference to people.

Lord Liddle: To make employers keen on this, you would not want to push their costs up hugely. You would have to create a framework of rights where the older person makes some financial sacrifice as well.

Dr Emily Andrews: That is where the extension of unpaid carers’ leave is an option.

Q76 Lord Petitgas: I could not agree more. I was going to get to this point about the employer cost. Given the macro benefits of having older people going back to work, which obviously include a reduction in the health bill, is there a way for us to create a new framework? Maybe there is not as much in national insurance. Maybe there are lower social costs for the state in the employment of older people. Otherwise, older people—beyond ageism and all the other things—are a more risky proposition.

I declare an interest: I have a small SME. The person who runs my SME is not really keen on this. I am pretty keen on it for all the reasons we have talked about, but there is more risk because the person is more likely to have health issues, in some people’s view. Therefore, there must be some form of incentive. As I said, there is this Bill coming through Parliament. Maybe there needs to be less national insurance. Maybe we need to find ways; otherwise, employers are going to struggle to employ these people.

Dr Emily Andrews: People used to say that about women of childbearing age but we have culturally moved beyond that.

Q77 Lord Londesborough: We have gone on a bit of a diversion but, coming back to my core question, how would you rank the Government’s policy priorities: health; skills and training; and employment practices? What is going to move the needle most?

Dr Emily Andrews: If those are my three choices, I would choose employer practices because they unlock a lot of the other stuff—although it is all of it, right? It is an interesting question. What is the Mayfield review doing at the moment? It is having to go around trying to work out how we get employers to change their behaviour with regards to people’s long-term health conditions and disabled people without spending any money and without putting any more burdens on employers; that is what it has been tasked to do. I thought the first report was very good. If there are good outcomes from that, this review has a good chance of getting to them.

What can you do within those constraints? Enforcement costs money but, right now, adding more rights beyond the Employment Rights Bill without doing more around the enforcement of the existing rights and the new rights would probably be silly. We know that not many people go to a tribunal because of an age discrimination case and that that is not because there is not much age discrimination in the labour market, so we definitely need to look at enforcement.

If you were going to add new rights, the one I would probably push on is more rights around other forms of care. There is also the stuff that the Health Foundation’s Commission for Healthier Working Lives put out recently around more of a framework around employers having to keep hold of people when they are on long-term sick leave and more pay protections for people who are long-term sick. It has made some really sensible recommendations that I would suggest you look at.

In terms of other things that the Government could do to move the needle on employment practices, I have talked about the jobcentre and employment support services doing much more on supporting what employers are doing. We currently have the 50-plus champions. The previous Government put them in place, and we think that they are great. There are not that many of them. They are employed by Jobcentre Plus at the regional level. They have injected some energy into what jobcentres are doing around this age group. A lot of them are actually doing employer engagement, but it is about giving them more time and more of an explicit remit to engage with employers and support them both to understand who the demographic is then to directly broker people into jobs.

In Germany, the active labour market policy for this age group that has been hailed most is a German programme called Perspektive 50plus. It was about brokering between a work coach and the employer, which was so important, then having ongoing support once the person was into that job. There is a role for the new jobs and careers service to do more of that, supporting employer change.

Again, more support for small employers to understand how to implement flexible jobs would make all the difference. There was a pilot on that; it was cut short recently. It would be really helpful if pilots could be allowed to run so that we could learn things from them. There is some scope there, and it could be within the remit of the jobs and careers service.

Lord Londesborough: I have a brief supplementary question, which is on an interesting angle. How well do you think the current young are being prepared for longer working lives? Is an 18 to 20 year-old who is entering the employment market and who may well have to go on working to the excess of the age of 70 being prepared for a longer working life? If not, what should be done about that in terms of their expectations?

Naomi Clayton: I would split that question into two: first, on how young people are being prepared for longer working lives; and, secondly, the infrastructure that is in place to support longer working lives, particularly if 50-year careers increasingly become the norm. We have spoken a bit about the core employability skills that are so important. It is about making sure that young people have good problem-solving, critical thinking and team working—all of the skills that people need in work, which are increasingly important and which will give young people flexibility and resilience as the world of work continues to change over time.

There are ongoing debates around the curriculum and the degree to which it supports the development of those skills, as well as around young people’s access to extracurricular activities that really help to develop those skills. We have seen big inequalities in access, in particular, to extracurricular activities. There is a bit of a question mark around the removal of maths and English requirements from apprenticeships, including around what that does to young people’s ability to adapt in the labour market later in life.

In terms of that infrastructure, it is about making sure, particularly as the job-specific and more technical skills needed for jobs change, that people have access to opportunities to retrain and upskill across their working lives and have access to really good careers advice and guidance.

Dr Emily Andrews: There is something that has been kicking around for quite a long time, which has been variously called the “midlife MOT” or the “midlife review”. We are very pro this. It has taken on different guises. Some large employers are taking it on, mostly those in the financial services industry where they see it as part of their role. Other employers, including employers in our Age-Friendly Employer Pledge network, are getting interested in midlife MOTs more and more. Those are not for young people but are an intervention that is seen to kick in around the mid-40s as a moment for people to think about their finances, their future financial position, their career aspirations and what their career might look like over the next 20 years.

Again, a pilot on these was run under the previous Government. What saddened me very much was that it was cancelled early because it was having a hard time recruiting employers. That is what happens with pilots. It is hard. It takes a long time when you are doing something new. It is such a shame that it got cut off just at the moment when it really could have taught us something. A lot of money was spent on it and there was some good learning in it, but it is not as rich as it could have been if it had been allowed to run to the end. There is definitely room for more testing in that midlife MOT space.

Broadly, on this point around upskilling and skills, I often say that we do not really talk about 50-plus retraining because all 25-plus skills policy is a total nightmare. All adult education over 25 is a really troubling picture in terms of the levels of investment that have gone down, but it is worth noting that around 14% of starters on sector-based work academy programmes are aged over 50. That is tiny compared to the workforce, but that is exactly the kind of programme we need to be targeting people to get on. Like you say, we need a job focus. That is what sector-based work academies—or SWAPs, as they are called now—are: really job-focused training programmes.

One of the most important things that the Government can do is take what we call an age-positive approach. If you are not going to do targeted 50-plus programmes, you need to have 50-plus standards, with high attachment or recruitment standards around the number of people you want to participate in these programmes and with much higher performance standards in terms of outcomes.

Q78 Baroness Liddell of Coatdyke: Building on what Lord Londesborough has been saying, can we be more specific about ageism, for example, as the population is ageing? What legislation is required to deal with some of the difficulties and the obstacles for a thriving working population that is ageing? Does the Equality Act 2010 need to be reviewed to meet the needs of this ageing population?

Dr Emily Andrews: That is interesting. I am looking behind me at my boss, who probably has thoughts. If there is something that I have left out, we will write to you in answer to that question about the Equality Act. Again, my concern is around the enforcement of what is already there. Are people empowered to go to tribunal? I would say that first.

If there is a legislative approach, we need something to oversee it. One thing that we do not have in England, which we do have in Wales and Northern Ireland, is a commissioner for older people and ageing. That would be quite a good place for a review of the Equality Act to sit as far as it pertains to age. One of my core recommendations would be that England needs a commissioner for older people and ageing who is appointed by the Government, is independent and could start to review some of this.

I heard this get asked last week: “Is there a number? Can we do something like the gender pay gap? Is there something like that?” Again, there are lots of people in this space who really think that there should be a number. I find it difficult to come up with one. What would be the right number? There are lots of employers that have loads of older workers and are very ageist because they are not hiring anyone new at that age and are not giving people the opportunity to progress; they just have people who are there. So it is quite difficult to get the number. That is my vague answer; if I can give you something more precise, I will write to you with it.

Naomi Clayton: In nearly all OECD countries, there is a form of legislation that prohibits explicit age discrimination. The big issue, as Emily has said, is around enforcement in terms of proving that discrimination has taken place, as well as the cost and procedural barriers. Enforcement feels like the major issue here—as well as, as we have already discussed, general attitudes and practices among employers.

Dr Emily Andrews: There was a piece in the Metro this morning with two people who have come via our big public “Age Without Limits” campaign. One of them was told explicitly by a recruiter, “Oh, we think they are looking for someone younger”. That is illegal. Illegal stuff is happening all the time. Often, it is couched in terms of, “We think you have a bit too much experience for the role”; that is a classic. There is a lack of cultural awareness that ageism is bad.

Naomi Clayton: There is a focus on organisational fit, which is quite vague.

Dr Emily Andrews: Yes. That disadvantages younger workers, older workers, disabled workers and anyone who does not look exactly like the person who is recruiting—or five years younger than they are, preferably.

Baroness Liddell of Coatdyke: I look forward to hearing from you.

Lord Burns: Are you in a position to say anything about how successful or otherwise the Older People’s Commissioner for Wales has been?

Dr Emily Andrews: We will write to you; I do not know it but I know that we know it.

Lord Burns: Maybe we need to speak to them.

Dr Emily Andrews: Yes, talk to them.

Q79 Lord Razzall: You will, I think, find that this committee will agree with you about age not necessarily being a bar. In answering a number of the questions, you have both raised a number of issues about programmes that have been tried successfully. It would be helpful for us if you could list programmes that you think have been successful, both in the UK and abroad. You have touched on a number of them. It would be useful if you, Emily, could pull that together.

Dr Emily Andrews: Sure—let me get my list together. Part of the problem is that we at the Centre for Ageing Better are a What Works centre. People say, “What works to get people over 50 back into work?”, and I say, “I don’t know because no one has tried hard enough to find out”. One of my key recommendations to the Government—it is one of the most impactful things that the Government could do—would be to add an explicit age element into all the evaluations of their active labour market policies, because they should evaluate all of their age-neutral programmes, to understand how well they are working for people in their 50s and 60s and to understand, if they are not working, why not.

That said, what seems to work? We have done co-design work for people who have been either long-term unemployed or economically inactive. The Greater Manchester Combined Authority is currently piloting a programme called Support to Succeed, which has a 50-plus element. That is very much about moving the people who are the furthest from the labour market towards work. If you have been out of the labour market for a long time, a lot of it is about confidence building—getting out of the house, seeing yourself doing something and seeing yourself in a new situation—before you could then think about going into work. That is what Support to Succeed has done; we will have an impact evaluation of that in a few months, because that evaluation is wrapping up at the moment.

We have partnered on a much smaller programme in Middlesbrough with people who are unemployed and who are Jobcentre Plus clients. If you read any evaluation of a good employment support programme, you have a key worker and a caseworker with whom you have plenty of time and who can both tailor their approach to your individual needs and deal with the different problems that you have. That is what this programme in Middlesbrough has had. It has been very successful. Some 20% of those people have moved into work. These are people who have spent months cycling through different programmes. What did it take? It basically took one really good, highly trained coach with enough time to spend with them.

In our written evidence, we have specifically broken down the international factors. We have drawn on Korea, the Netherlands, Canada and Germany. A key factor is coaching support, often in the form of group coaching. We have trialled group coaching for people who have recently been made redundant. That can be really successful for people to process it together with a confidence-building element. There is job search help, for example on how to write a CV. If you have not written a CV for 30 years, that is really important.

Then there is the final piece, which was present in Germany, Canada and one of the other countries: employer engagement. It is a specific sell of those workers to employers.

Naomi Clayton: There are lots of things that we can learn from past programmes about effectiveness and what works best in employment support. The starting point is to go back to the figure of just one in 10 older people accessing support to find work each year. There is this starting point of the fundamental issue of access to support, which is why it is really welcome to see the Government developing the new jobs and careers service. If you go back to 2009, 500,000 people were visiting jobcentres without appointments. That has since changed fundamentally, obviously, and Jobcentre Plus is no longer open to the public. A lot of jobcentres have closed, so there is this issue of access to support. It is very welcome that the Government are focusing on that.

Particularly when it comes to employment support, it needs to be accessible and closer to where people are. Older people are more likely to access support through faith groups, libraries and other council services. It is fundamental that any new services are accessible to individuals, and that the DWP and Jobcentre Plus work with the types of community organisations and services that can support access and awareness of the support available.

We know that support tends to work best if it is on a voluntary basis; if advisers have relatively small case loads; if there is consistent adviser support so that you are building up that trust and consistency; and if support is tailored to individuals’ needs, as we have been saying throughout this session. Often, there are multiple factors as to why somebody is not in work or struggling to return to work, so it is really important that support is tailored to individuals’ needs. We ran a big commission on the future of employment support. We have said that any new provision and support absolutely need to be tailored to the needs of over-50s; and that we should set clear targets for older people, too, as well as publishing performance data so that we can drive up standards and practice.

In terms of specific support, there were a number of things here. When the new deal for over-50s was previously introduced, it was the first national employment programme that was specifically designed to support older people back into work. Having that tailored support and that personal adviser approach, making sure that support was individualised, is critical.

Lord Razzall: Did that work?

Naomi Clayton: It did to an extent. It was very successful in supporting people back into work, but there were some changes to the financial incentives that were built in. One of the lessons from that initiative, in terms of sustaining those employment outcomes, is around in-work support. We know that that is often critical to sustaining those employment outcomes over the long term.

There is a lot that we already know about what makes for effective employment support for individuals. There is a lot that we have learned through various iterations of mid-life career reviews. Often, the issue with things such as that is getting employers on board, but also low levels of awareness, so we need to look at how we can raise awareness, too. There are examples from other countries where they have implemented initiatives that enable those kinds of career discussions and reviews with people, which are really important for people in terms of staying in work and progressing in work.

Lord Razzall: Have other countries done that through legislation or just through encouragement?

Naomi Clayton: Predominantly, things like that are through specific initiatives and investment in specific programmes.

Q80 Lord Davies of Brixton: We previously did a study about getting people back into work; if you have not read it, that is our fault, not yours. Most of the members were keen on work coaching and individualised support in general, but we were steered off it. I cannot remember exactly how we worded it in the end but we were steered off it because it is fearsomely expensive to do it for everybody. Is there any way of identifying which candidates would most likely benefit from that intensive individual support, or is this where one of your pilots is relevant?

Naomi Clayton: We proposed, in the commission, that we had different forms of support: lighter-touch online support, which would be much more widely available; and more specialised support for people who face specific disadvantages in the labour market, such as somebody is disabled, who has a health condition and/or who is an older worker. This comes at a greater cost, but there is a greater need there. With these things, the costs and benefits often even out. The evidence consistently shows the need for tailored, individualised support, particularly for more disadvantaged groups.

Dr Emily Andrews: Do not discount online support for people in this age cohort. It is not the answer for everyone but a Select Committee did some polling during the pandemic asking people aged 50 to 70 who were out of work how they would most want to receive employment support. The most popular answer was “online”. No one wants to be a service user. People are independent. People say, “I want to look after myself. I want to get the information myself”.

The service that we have proposed is an online starting place for people that allows them to go through and pull together their CV, looking at different decades of their life, because it gets harder to write a coherent job application as we get more and more experience. We developed a tool to help people both to do that and to think about skills that they developed through doing different things that were not necessarily paid work. If they had 10, 15 or 20 years when they were caring, what skills did they develop there? The idea is that there is a self-service element that then allows people to speak to a coach if they want more help. Porting people into a coach was important.

Someone recently looked at me wide-eyed when I talked about coaching being the answer. She said, “But it doesn’t scale”. No, it does not, but the return on investment of active labour market policies is incredibly strong. I would advocate for people, particularly in this age cohort, presenting at the jobcentre to be given more intensive support much more quickly. There is a real risk if people are left with the standard level of JCP support, which is pretty low for the first couple of months. If you were to give that person a more intensive intervention earlier on, they would be more likely to move into work more quickly.

Lord Turnbull: Much of your evidence has been around this question of whether we have instruments and attitudes that were designed for one era and are still with us, which we have not got rid of and moved on from; and whether many employers still have the view of getting people out of the door rather than getting people on to the next stage. Last week, I went to the funeral of a Civil Service colleague who retired aged 51 and had 18 years after being given a three-figure sum to go. I hope that those attitudes have gone and that we are now looking at more constructive ways of dealing with efficiency.

I agree very much that there is this question of whether dealing with people by the cheapest possible means is the right answer. It does not help that many government departments still work on the idea that there are things called running costs, for which there are targets set and which Mr McFadden is chasing out there, and there are programme costs. By cutting running costs, you get a more immediate result, but I suspect that, in the long term, you do not get the best results. We need to re-examine the balance between things such as your MOT support and your pre-separation report. They may cost more in the long run but, if they are properly designed, it may well be that they have a very good return.

We need to work on that and not blindly cut the running costs. We have done exactly the same thing with invalidity benefits. We have cut the running costs and allowed the programme costs to go completely wild. We have the same opportunity in this field.

Q81 Lord Lamont of Lerwick: First, my apologies for having slipped out of the committee for a few minutes earlier. My question is primarily for Emily but, if Naomi has a comment on it, I would be interested. Your organisation, the CfAB, urged the Government to commit to an employment rate of 75%—an actual specific target for people aged 50 to 64—by the specific date of 2030, and, furthermore, to have a means of measuring progress towards that target over the period. I do not think that you commented on this explicitly, although it was perhaps implied in your exchanges with Lord Londesborough, but is setting a target like that, which is really specific and sounds very ambitious, consistent with the sort of progress that we have seen in the past? What are the levers that would enable you to get to this specific target, or are they just the things that we have been discussing this afternoon? Is that all, because I doubt if they would be enough?

Dr Emily Andrews: We have recently updated those targets in response to the Government—we have heard about this—now having an 80% employment rate target. We looked at the three countries that have an 80% employment rate. We have heard about them: the Netherlands, Switzerland and Iceland. We looked at what it would take for us to start matching those, and we have come out with a new set of targets that we have judged on what would be reasonable both internationally and based on different trends. That was an 80% target for 50-to-59s; I am afraid that I do not remember the target for 60-plus precisely, but we have a new, precise set of recommended targets.

As for the efficacy of them, the Government’s Labour Market Advisory Board recently set out a set of labour market outcomes measures that are apparently going to be tracked. I was very disappointed to see that a 50-plus target was not on there; there are targets for other groups that the Government are apparently going to be pushing forward on. What I was pleased to see was that all of their employment rate targets go up to 66. That is quite right because that will be the upper end of working age, but we do not always see that. That will do it in and of itself because, if your target goes up to 66, you really need to get people in their 60s working.

Then there is the question of what the lever is to reach that target. This is the thing that always worries me about putting out the target: if you want to get there the quickest, does that mean incentivising the wealthiest to stay in work? That may be the easiest way to keep people in work but that does not support the people who most need to stay in work, if you see what I mean. That is the problem with it. It is important to have a target as an aspiration. To set a government intention around this group in the same way that they do with NEETs, for example, is really important.

There are levers that we have not discussed. We have talked about having standards for all programmes, which could make a huge difference. That is not just an overall target but, when we are spending money on active labour market policies, we should have performance and attachment targets for this age group. That in itself could make a lot of difference.

If you were a Government who wanted to watch and see what happens, you could stop at what we call the age positive and age curious, which is the evaluation. That would not move you far enough, so you would have to go more age-targeted, which would mean Kickstart-style back-to-work schemes for people in this age cohort.

Naomi Clayton: I would view the 80% employment rate as a longer-term ambition that the Government have. It is a good ambition to have, particularly if it supports more cross-government thinking on this issue. If you are going to get to an 80% employment rate, you need to look at how to close those employment rate gaps, whether you are looking at the disability employment rate gap, the gap for older people, or the geographical and spatial gaps in employment rates. You need to work on all of those.

Like I said, it is a good ambition if it supports more cross-government thinking on this issue because, as we have seen, there are a number of factors and issues here. This is not just an issue for the DWP. It is also relevant to the Department for Education. We have spoken about health at length. That is a huge issue, as is what happens next on employment rights and with the industrial policy. All of these things matter and combine to impact on future employment prospects. I hope that, with the right kind of reforms and decisions, we can get towards that 80% employment rate.

Q82 Lord Davies of Brixton: Bearing in mind that our report is about what needs to be done to prepare for an ageing society, what would each of your top three recommendations be for what needs to be done? The question here says, “recommendations for the Government”, but it is perhaps not just the Government who need to do things.

Naomi Clayton: I would start with some of the existing reforms that are taking place, particularly with the new jobs and careers service. Through our commission on the future of employment support, we looked at how you support better employment outcomes across different age groups and looked specifically at older people. As that new service is developed and implemented, we absolutely need to make sure that it is age positive and age inclusive. This means coming back to some of the things that we have spoken about in terms of providing tailored one-to-one support, building on advisers’ skills and capabilities, meeting any additional support needs, and making sure that those services are accessible in communities. That is really important and needs to be backed by clear targets and performance measures to make sure that the new system is delivering for older people.

Secondly, we need better access to careers guidance and training, particularly in later life to support older workers to stay in jobs and, in some cases, to move jobs.

Thirdly, I come back to employer attitudes and practices. As I have already said, it is about the Government getting behind an age-friendly employer pledge to promote more age-positive and age-inclusive employment practices, as well as supporting employers—SMEs in particular—to look at how they might introduce more flexible forms of working.

Dr Emily Andrews: I feel like I should have different ones because then I get the chance to have three, but I will not; I will stick with my original ones.

The first is standards. That could be one of the most effective things. In all of government activity, setting those high performance standards—I have said it a lot—does not cost anything. Set a standard then see how the system responds. Create that incentive.

Expand the role of 50-plus champions under Jobcentre Plus, including employer engagement. To that, I would add championing the Age-Friendly Employer Pledge, which we run. It is a free national programme. We now have over 500 employers in the network; we recently hit that target. The Government champion it and talk about it, but there is loads more that we could do together. If they ever want to give us some money to run it, that would be much appreciated.

There are loads of detailed things, such as carers’ leave, enforcement and Kickstart, which we have talked about. I would be interested to know what you all end up concluding around having a commissioner for older people and ageing for England to hold the Government’s feet to the fire on this issue in the coming years. I would encourage you to talk to some of the commissioners who already exist.

Q83 Lord Blackwell: As Lord Davies says, the onus is not necessarily on the Government to do things on this. I am just reflecting on the wider point that we have been looking at in this inquiry: going forward, because of the increasing dependency ratio, we are potentially looking at a significant shortfall in the labour force relative to what is needed to support the population. If Governments reduce the expansion of the labour force through immigration, the demand for labour will become more intense. May this not solve itself in the sense that employers will be forced, in their search for labour, to find ways of attracting, retaining, training and recruiting these workers? Will it be a self-correcting problem because of the economics of the labour force?

Naomi Clayton: As we said earlier in the session, there is a greater imperative for employers to look at how they might change their practices and what they might do differently in terms of recruitment and job design. That imperative becomes greater as the workforce shrinks and we face challenges around skills shortages.

One of the issues is that lots of employers—particularly smaller companies and SMEs without large HR functions—do not necessarily know what types of support and ways of working work best. There is more that government and larger employers can do through their supply chains to support SMEs, in particular, in looking at what they might do differently.

Dr Emily Andrews: I had a conversation with someone from a local authority in one of the oldest parts of the country who had been trying to get their HR department to sign up to our Age-Friendly Employer Pledge; it is free, so it is not a huge commitment. There is a commitment and there is some accountability but it is not a huge ask. Their HR department came back and said, “No, we can’t sign this because we are already so old as an organisation. It might put off young people from working here”. To which my question is, “Where are those young people going to come from?”

It takes people a long time to realise that this is the demographic. This is your workforce. Skills shortages are not new in this country. They have been quite intense over the past few years yet, a year ago, there was a survey that suggested that the average age a recruiter thought was too old to have a job is 57; that was the oldest age at which they thought someone could get a new job.

If these things were going to correct quickly, they would have done so already. There is some waking up that has to happen. If we allow that to happen naturally, it will be the people who have the least options available to them who will suffer the most.

Q84 Lord Lamont of Lerwick: May I put Lord Blackwell’s question in a slightly different way? Looking historically, you have shown that we have increased participation of people over 50 and that older people are participating more, but is that not actually due to market forces, with what has happened in the economy and the demand? Measures such as increasing the retirement age have a marked effect, but is not the increased participation, which has gone in the right direction with a hiccup here and there, because of market forces? All right, it has not solved itself, as Lord Blackwell put it, but what has actually come in the past from government initiatives other than the raising of the retirement age? Is the rest of it not entirely due to market forces?

Dr Emily Andrews: Another key policy change that has ended up leading to this is better maternity policies, which meant that the generation of women over the past 10 years who were in their 50s and 60s were more likely to be attached to the labour market and, therefore, more likely to work in their 50s and 60s. What we said was, “If you have things going on in your life that mean you cannot be exactly what an employer wants, we will support you to return to work so that you can keep doing that”. We have had that revolution once in this country. If we are going to have an older demographic, we are going to need to do that again with different forms of care and different forms of complexity that stop people being able to work. Policy has had an impact but we have not tried to do the 50-plus base very much yet.

Lord Davies of Brixton: The one policy you did not mention, of course, is increasing the state pension age. Would you agree with my view that increasing the state pension age does nothing to create job opportunities for older people?

Dr Emily Andrews: Yes. The evidence suggests that what happens is that, when people who are still in work reach the old state pension age, they just keep working another year. The IFS showed that the increase from 65 to 66 created a seven percentage point increase in employment among 65 year-olds [1], which is huge—that is an enormous effect of one policy change—but that is not going to make any difference to the majority of people who had already dropped out of work before that.

Lord Londesborough: It is going to keep people in work, rather than retiring, so that is going to surely have an impact.

Dr Emily Andrews: Yes, if they have made it to 65 or 66.

Lord Davies of Brixton: Did you say a 7% increase?

Dr Emily Andrews: I believe it was a seven percentage point increase [2].

Lord Petitgas: I do not know whether it was the Equality Act that drove this but, in business, there are quotas where you basically put a target, in the same way as you have a target. In the City, people say, “We need to have a minimum of X percent of certain minorities and women”. Of course there are market forces but, if you want to correct things a little, you definitely need to bend the light. Would you advocate that we should put in quotas so that, if you are Lloyds, you need to have a minimum of X percent of people above the age of, say, 57?

Lord Razzall: You called them standards, did you not?

Lord Petitgas: Are they the standards you talked about?

Dr Emily Andrews: When I am talking about standards, I am talking about government programmes. I know that there are lots of people who like the idea of making businesses have a target in the same way as the gender pay gap. The challenge is finding the right number. I would definitely do a target for the employment of disabled people first.

Q85 Lord Blackwell: I have one last question on the data. We have information showing how this has changed from 2016 to 2024. How much further back do you have data on what the participation rates were? I am very interested whether this is a millennium issue. People did not live as long if we go back to the 1980s and 1990s, but was it more common to work until the retirement age then drop out and die?

Dr Emily Andrews: It is a kind of U, is it not? In the 1970s, among men, it was slightly higher than it is now. It went down and we had a pro-retirement policy landscape. It has gone up a lot since the turn of the century.

Lord Blackwell: You are saying that, in the 1970s, people worked a lot longer.

Dr Emily Andrews: Men did. I believe that the employment rate of people over 50 was about roughly what it is now in the 1970s; I will check that. I believe that Jonathan Cribb was talking about that last week.

Lord Razzall: Was there a difference in balance between men and women in that?

Dr Emily Andrews: Yes.

Lord Blackwell: If you have any information on that, I would be very interesting to hear it.

Dr Emily Andrews: The IFS has done the long-run stuff. It is good.

The Chair: You can tell, from the number of follow-ups, that you have stimulated our interest. Thank you both very much for all your thoughts, comments and interaction. We really appreciate it. As I said earlier on, we will soon give you a transcript for you to check to make sure that, if we quote you in our report, we are quoting you accurately. Thank you again. I now declare the meeting concluded.

[1] [Added following the meeting – IFS figures indicate an increase in the employment rate of 65-year-old men by 7.4 percentage points and of 65-year-old women by 8.5 percentage points due to the effect of the latest SPA increase. Institute for Fiscal Studies, Labour market effects of the increase in the state pension age from 65 to 66 (25 January 2022): https://ifs.org.uk/publications/labour-market-effects-increase-state-pension-age-65-66.]

[2] [Added following the meeting – The weighted average given the above figures would be around 8 percentage points, rather than seven.]