Prudential’s analysis supports new model of retirement
The research, based on analysis of the ONS Annual Survey of Hours and Earnings (ASHE), shows that between 2011 and 2013, the average annual income for over-60s in work rose by 6.1 per cent to £17,250. This was the biggest rise of any age group and well ahead of the average 3.8 per cent increase in earnings for all age groups.
The figures show that over 100,000 more over-60s were in work in 2013 than in 2011 and many of them were in senior positions. Management roles saw the greatest increase in older workers, with an extra 32,000 over 60s managers in 2013 compared with 2011, a rise of 25.6 per cent.
The rise of management level over-60s appears to be reflected in the average annual incomes received by full-time older workers – in 2013 it was around £25,200 compared with £24,000 in 2011.
Prudential’s analysis also shows that among the over-60s women have been the big winners in terms of pay rises, with average earnings increasing by 11.4 per cent compared with 4.2 per cent for men.
Stan Russell, retirement income expert at Prudential, said: “Our analysis suggests that the relative success of older workers in the labour market is down to a combination of their increasing willingness to work on rather than retire, and the recognition by employers of the unique experience and skills they bring to the workplace.
“Our previous research has highlighted the changing face of retirement and this latest analysis is further proof of the new retirement reality. Many older people are happy to stay in work for longer and they are now seeing the welcome side-effect of significant year-on-year increases in annual earnings.
“However, there are of course those who would prefer to give up work in their seventh decade but have had to delay their retirement because of insufficient pension savings.
“It is important to remember therefore that the money earned in the later years of a career may be too little too late, despite the pay rises for the over-60s that we have identified. The best way to secure a comfortable retirement income is to save as much as possible as early as possible, and take the advice of a retirement specialist or financial adviser.”