Introduction

In the opening decade of the 21st century, much uncertainty still surrounds the transition from work to retirement. The causal factors here come from various directions associated with economic, social and cultural change. The economic foundation of retirement has been undermined with the unravelling of state and personal pensions, and the movement of companies from defined benefit to money purchase schemes. The social desirability of retirement has also been questioned, with moves to increasing state pension age in virtually all industrialised economies (DWP, 2006a; OECD, 2006). The meanings attached to retirement have, at the same time, become more complex, reflecting the varied health, financial and personal circumstances of retirees (Phillipson and Smith, 2005).

But reversing retirement trends may prove difficult – at least over the medium term. Governments, for a variety of reasons, are encouraging later retirement along with ‘age diversity’ in the workplace. In contrast, attitudes and aspirations on the part of working people (especially those comprising the ‘baby boom’ generation) may run in the opposite direction. This chapter explores tensions in current debates about retirement by:

• • summarising current trends in the transition from work to retirement;

• • examining the range of factors encouraging people to leave employment;

• • assessing policy options for stimulating age diversity in the workplace.

Retirement trends

A well-documented trend in the UK and most industrialised countries has been the declining age of exit from the labour force (Kohli et al, 1991; OECD, 2006). Among men in the UK aged 60-64, labour force participation declined from 82.9% in 1971 to 54.1% in 1991; by 2000, the rate had declined to less than 50%. The proportion of men aged 50-64 neither in work nor looking for employment increased from 11% in 1976 to 27% by the end of the 1990s. In general, male employment rates now begin to decline from an earlier age: as early as age 50 in the UK, according to one estimate (Campbell, 1999).

The move away from paid work was accelerated by periods of high unemployment in the 1970s and 1980s. From the late 1990s, with the move out of economic recession, the shift towards earlier retirement went into reverse, with modest increases in economic activity for men and women in their late 50s.