Academic journal article Australian Journal of Social Issues

Life after Work: Older Australians' Experiences of Early Exit from the Workforce

Academic journal article Australian Journal of Social Issues

Life after Work: Older Australians' Experiences of Early Exit from the Workforce

Article excerpt

Introduction

The Australian population is ageing and a growing proportion of older workers is exiting the labour market younger than the qualifying age for the state-provided Age Pension (Schofield et al. 2007; Shacklock et al. 2009). Research on the workforce participation patterns of older workers has mainly focussed on their retirement plans and the numbers of those in and out of the workforce. Less is known about the experience of 50-64 year olds already outside the workforce, including whether they are able or willing to consider re-entering paid employment and the extent to which they may move in and out of the workforce. Even less is known about this group's health (Quine & Carter 2006; Humpel et al. 2010b). Using data from in-depth interviews this paper seeks to address those gaps in research by exploring the reasons people aged 50-64 leave the workforce, how they perceive being outside the workforce affects their health and wellbeing, how their socioeconomic circumstances shape their experience and how they imagine their future, including re-entering the workforce. We consider briefly the implications of our findings for Australian labour force policy.

Policy context

As the population ages, health expenditure has been predicted to rise and the paid workforce to shrink, the consequence being reduced taxation revenue to meet health expenses (Productivity Commission 2005; Cai & Kalb 2006). In the 1980s and 1990s policy makers encouraged early workforce exit during a period of relatively high unemployment, so that younger generations could take the available jobs (OECD 2004, 2006; Walter et al. 2008). More recently, however, unemployment rates have been lower and the key policy issue has become labour shortage (Productivity. Commission 2005).

Since the early 2000s the Australian Government has been implementing a range of strategies to encourage older workers, defined as those aged 50 years or more, to remain in the labour market for longer (OECD 2006; Walter et al. 2008; Humpel et al. 2009). Policy strategies have centred on financial incentives to remain in paid work and disincentives to exit the workforce in line with a move to reduce welfare expenditure. These have included increasing the qualifying age for the state-provided Age Pension, (1) removing the Mature Age Allowance which until 2003 was available for unemployed older workers, introducing tax reforms to remove incentives to exit early and increasing the eligibility age for occupational pensions (OECD 2005, 2006; Felmingham et al. 2008; Walter et al. 2008; D'Addio et al. 2010). Additional smaller-scale strategies have also been introduced, such as the provision of information to help reduce age-based discrimination and increased support and training for unemployed people over 50 years old (OECD 2004; Walter et al. 2008; D'Addio et al. 2010; DEEWR 2011).

As part of policy effort to reduce welfare payments, Australian disability" services, including the Disability Support Pension, have also undergone substantial change since disability policy was identified as a 'national social policy priority' in the 1970s (Soldatic & Pini 2012: 184). A shift from welfare as a right to welfare as a social contract, with regard to disability support, began with the introduction of mutual obligation requirements by the Howard Government's Welfare to Work policy (Yeatman 2000; Humpage 2007). The basic premise underpinning Welfare to Work is that if welfare recipients are exhorted to participate in work or training in order to maintain their benefits, they will be more likely to move in to the labour market voluntarily (Soldatic & Pini 2009). This logic locates the problem as individuals' lack of volition to work (Humpage 2007; Soldatic & Pini 2009). Paradoxically, Disability Support Pension recipients would lose their pension and associated support if they work more than the maximum hours prescribed, creating a disincentive to gain paid work (Humpage 2007). …

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