An ageing workforce: The employer's perspective

Against a widely recognised background of workforce ageing, skills shortages, an early retirement culture and the prospect of a pensions crisis, prolonging the labour market participation of older workers has become a key policy objective in the UK.

Work-life balance policies and flexible employment can provide the means of prolonging labour market engagement. Changes in retirement behaviour will therefore originate primarily from the demand side – ie employers’ policies. This study assessed the range of schemes introduced to prevent early exit (whether voluntary or involuntary) and to facilitate the employment of staff to pension age and beyond. 

Main findings

  • Only half of employers have a formal pro-age recruitment policy, and many are nervous of discussing age issues with workers as they approach retirement. 
  • Many businesses are open to making adjustments to the workplace to help retain staff if the issue is raised on an informal basis. 
  • Many employers are happy to let people carry on working after the normal retirement age of 65, and many would also be happy to see compulsory retirement abolished, but that they need support to get the best out of more mature workers. 
  • Formal pro-age recruitment policies and age management policies are more common in larger organisations. They are less likely in industries dominated by men and those organisations that tend to ‘recruit from within’.
  • The absence of formal pro-age recruitment policies does not necessarily mean bad practice, however. Employers recognise the benefits of older workers.
  • Some employers did express reservations around older workers, where they did not match their customer demographic or there was a heavy manual element to their work. 
  • Health is still largely regarded as a private, individual matter rather than a concern for employers beyond meeting specific health and safety regulations. 
  • Some employers simply do not have any experience of staff retiring, often because they have a small business or a new business with a young workforce. Larger employers were familiar with the retirement process and more often had policies in place to manage the process.
  • Older workers in sectors with skills shortages are recognised as a valuable resource, and employers are keen to retain them.
Project details



Helen Barnes, Institute of Employment Studies (IES)

Grant amount and duration


January 2008 - November 2008



An Ageing Workforce – The Employer’s Perspective, Helen Barnes, Deborah Smeaton, Rebecca Taylor. IES Report 468, October 2009.

Download report (PDF)