Employee recruitment at risk through pension planning fears

A rising number of employees working past traditional retirement age could affect a company’s ability to recruit new talent, according to a study by consultancy company Portus. As more people can’t afford to retire into their 60s and beyond, 41% of HR executives believe companies will struggle to recruit and retain new staff.

1.19 million people over the age of 65 are currently working in the UK, almost double the 635,000 older workers present in 2006. The population of the UK has risen by five million since 2006, while the global population has rise by around one billion within the same timeframe. As the population grows, the age of employment is only expected to rise going forward. As age expectancy increases and younger workers face higher state pension ages. 23% of those aged 25-34 believe they’ll stop working by 65, but Portus believes that if more and more are staying in work simply because they can’t afford to stop as they grow older, then employers must face reality.

“If people are staying in work simply because they cannot afford to retire then it becomes a possible flashpoint for employers and a potential issue in managing their business for the benefit of all employees,” said Steve Watson, Portus consulting commercial director, who identified that working past 65 is becoming an increasingly normal occurrence.

Mr Watson believes that support is a simple solution that could lead to major changes in nationwide understanding. 84% of 35-44 year olds believe they would be more comfortable with online guidance support to walk them through and keep track of their retirement savings, a fix that Portus believes should be implemented as soon as poss

“New pension freedoms have meant increased flexibility over pension funds and increasingly put the responsibility for retirement planning on employees,” he continued. “People however need support in managing their retirement plans and employers have a role to play in delivering guidance”