Half of older workers who retired during the Covid pandemic ended up falling into relative poverty, according to the Institute for Fiscal Studies.
The IFS study found that 48% of those who retired in 2020-21 were now living in relative poverty.
It said older workers between the ages of 50 and 70 who left in the first year of the pandemic were “not retiring in comfort” as compared with those who had retired a year earlier.
And that those who had retired in 2020-21 cut their spending on food by about £60 per week on average.
Nearly half (49%) had no access to either private or state pensions, compared with 43% of those who were newly inactive in 2019-20.
It also found that older people who stop working often never re-enter the workforce.
“This group may be experiencing long-term poverty and greater hardship in the current cost of living crisis,” IFS said.
The study, funded by the Joseph Rowntree Foundation, said disruption from the pandemic and perceived health risks may have forced many to leave work early.
Andy Briggs, Phoenix Group CEO and government champion of older workers said:
“Our research has shown that while many people are working for longer to save for their longer lives, there is a real issue with people struggling to work up to the state pension age. We have also found that people aged 50-64 who leave work early due to ill health have only five per cent of the wealth of those who choose to retire early.
“Financial pressures, particularly with the cost of living, may push some people to return to work, but we know that without good jobs and age-inclusive employers, many people will still face the same barriers to work that made them leave in the first place. Employers and the wider economy both benefit from attracting and holding on to the skills and experience that older workers can bring, particularly in a tight labour market.”
