No gain in quest for older workforce

Raising the pension age from 65 to 67 will have limited impact on older workers’ employment rates due to the high number of Australians who leave the workforce in their 50s and early 60s and receive a disability pension or other government payment, a leading economist says.

Adele Horin, writing in the Sydney Morning Herald, quotes Bob Gregory, professor of economics at the Australian National University. He says 90% of single people who take up the age pension at 65 had previously received another payment – the disability pension, carer payment or Newstart Allowance, on average for six years.

A high proportion of married couples also followed this path, from dependence on a government payment in their late 50s or early 60s to reliance on the age pension, he said.

“If I go on the disability pension at 63, I move seamlessly to the age pension at 65,” he said.

“If eligibility for the age pension moves to 67, I just spend the extra years on the disability pension, so nothing is gained for workforce participation.”

Professor Gregory, told a Sydney forum that policies to increase workforce participation had to start much earlier than 65.

In the past decade, there had been improvements in retention of older workers. Nevertheless it was the 55-65 age group that was moving out of the labour market.

In 2007, the average age of retirement was 59 years.

Professor Gregory said that, contrary to myth, it was the poorer Australians who left early or lost their jobs, and moved on to a payment, and the better-off who stayed on in jobs they usually liked.

Last year, the government announced that in 2017, the qualifying age for the age pension would gradually start to increase, reaching 67 for both men and women by 2023. This means men and women born on or after January 1, 1957, will not be eligible for the age pension until they are 67. Those born after July 1, 1952, will also have to wait longer than now.

With this in mind, a free career advice service designed for mature Australians is available.

If you are 45 years or older, you can book an appointment with a qualified career adviser. Your career adviser will help you identify your skills, explore career options and develop a personal plan to achieve your employment goals.

They can also review your résumé and provide detailed feedback and suggestions for improvement.

You will receive a free copy of the Experience+ Career Guide when you contact the service. This new service is part of Experience+, the Federal Government’s Productive Ageing Package.

To make an appointment phone 13 17 64 from 8am to 6pm, Monday to Friday or visit their website http://www.deewr.gov.au/experienceplus