A lifetime of experience in computer based accounting systems did not help Jen Howell when she went looking for a job in her mid-50s. After months of fruitless searching and job interviews that focused on her age not her skills, she decided to return to what she knew best, not as an employee but as a self-employed sole-trader.
However, she could not rely on attracting a steady stream of clients from the large organisations where she used to work. Transforming this challenge into an opportunity, Jen diversified into general IT training and book-keeping services for fellow small businesses and self-employed. She knew that most small businesses detest preparing annual accounts and, from that insight, 'Books in Boxes' was born.
Clients bring all their receipts and invoices in boxes and Jen turns the mess into books of well-kept accounts. Jen is now pushing the official retirement age but is still going strong, actively recruiting clients through accountancy service websites.
Similarly, Mike Crisp hit strong age barriers when he began job-hunting in his mid-50s following a 4-year bout of late-career higher education. With good experience as a RAF technician followed by years as a systems engineer in the computer and aircraft industries in Britain and Saudi Arabia.
On returning to Britain he decided to get the university education that he had missed when young. Instead of his degrees in law and psychology unlocking the job markets for him, however, he found it hard to get a job.
Impressed by an Australian business that provided house renovation and maintenance services for an affordable set fee, Mike founded HouseHubbies when he was aged 58. Five years later the firm was thriving, having opened two new sites in the Manchester and Staffordshire areas as well as employing Mike and nine other people.
These two stories of age-related barriers prompting late life entrepreneurship reflect a growing trend. A drop in birth rates and longer life-spans due to increasingly more effective health care means the populations of most developed economies are ageing. At the same time, global competition and technological change, plus a perception that it is hard to re-train older workers, have skewed demand in the jobs markets towards a diminishing proportion of younger workers.
This is leading to a steady leakage of experience-based knowledge and skills from the labour force and a worrying rise in the ‘dependency ratio’ – the proportion of working people supporting, through their taxes, the economically inactive. Those aged 50 or more account for some 70 per cent of the economically inactive. In 2004, the National Audit Office estimated that the then 2.7 million people between 50 and State Pension Age (SPA) who were not working were costing the UK economy £18-£31 billion in benefits payments plus lost output and taxes.
It is not surprising, therefore, that governments across Europe are concerned to increase employment and entrepreneurship among the post-50s by as much as they can. In Britain, the Performance and Innovation Unit (PIU) 2000 report, Winning the Generation Game, recommended a selective raising of the pension age (which is now underway) and legislation to prohibit age discrimination at work, in the job markets and elsewhere (implemented as the Age Discrimination Act in October 2006).
Employment rates have improved. Increasing the participation of ‘seniors’ in the labour market, is also an important part of the EU 2005 Lisbon Strategy. EU studies confirm that overall employment among seniors (people aged 50 -64 years) in the enlarged EU rose from 37 per cent in 2000 to 43 per cent in 2005. Britain was among those that had reached or exceeded its 2010 target. However, the picture in relation to self-employment and entrepreneurship was not so positive.
There are two main sets of reasons why older people decide that they should keep working – financial necessity and satisfaction and the need to be active. With regard to the first set, the most common financial pressure comes from inadequate pensions (the Pensions Commission suggests that about 11.3million people are not saving enough to fund their retirement).
The post-50s self-employed entrepreneurs come from three main stands:
- existing self-employed and small business owners who decide to continue to work
- high-earning ex-employees who have high levels of education or professionally training, with a strong work history, good work ethic and well motivated, who choose to continue
- those with lower incomes working through necessity.
"only 10% of post-50s who lose their jobs find paid-employment"
With regard to this third category, it is worth noting that only around 10 per cent of post-50s who lose their jobs find paid-employment after fifty so, even if they just drifted into self-employment, they are still more entrepreneurial that some 90 per cent of older people.
For those looking to continue working, help and support is available from various organisations who have started working in this area. For example, PRIME is a not-for-profit organisation established in 2001 by the Prince of Wales which specializes in assisting the self-employed. TAEN is an independent charity with a wider remit: all aspects of age and employment. These organisations, like their peers, offer advice and resources to help people who feel excluded from employment by their age.