The return of the over 50’s
An estimated half a million people in the UK left their jobs during the pandemic with the intention of never returning. Economic inactivity, a term related to people unemployed and not actively seeking work, remains above pre-pandemic levels in the UK.
Those aged between 50 and 64 have been credited with leading the charge, with early retirement and ill health cited as the two key drivers. However, recent data published by the Office for National Statistics and analysed by the Institute for Fiscal Studies suggests these very same workers are now behind the sharp rise in older people re-joining the workforce.
The initial exodus and resulting permanent (as it was seen at the time) reduction in the labour supply was viewed by the Bank of England as a serious blow to the UK’s prospects for economic growth. These people had become inactive, however, the last quarter of 2022 saw almost 200,000 workers in this age range change their minds and return to work, many no doubt influenced by the current cost of living crisis.
A reversing trend?
As retirement ages continue to rise and people live longer, it’s becoming increasingly common for older workers to seek opportunities to return to work. While some do so out of necessity, other motives influence decisions to re-enter the workforce. The legal sector is one of the most dynamic and prestigious industries in the UK, and it is not uncommon for individuals to return to work in this sector later in life. The reasons for returning to work can vary greatly and can be linked to both push and pull factors.
Push Factors
Financial Pressure
Financial needs are often the primary push factor for individuals over 50 who are returning to work. This can be due to factors such as retirement not providing enough income, a reduction in pension income, or unexpected financial expenses.
Mental Health
Stress is among the most common reasons why older workers stop working or decide not to return to work. Given the fast-paced and often pressurised environment of law firms, this can be a strong contributor to legal professionals opting to step away from work early.
Health Care Costs
As workers age, they often face increased health care costs, which can put a strain on their finances. Returning to work can provide access to health care benefits, which can be an important factor in the decision to continue working.
Job Loss
Another push factor for those over 50 to return to work is job loss. With the changing economy, many individuals have found themselves without work, and returning to the legal sector is an option to regain financial stability.
Government Benefits
State benefits can provide a valuable source of income and support in retirement, but they are often not enough to cover expenses and the age some can be accessed continues to increase. Working past retirement age can allow workers to accumulate benefits over a longer period, enhancing their overall income in retirement.
Tax Legislation
The laws surrounding the tax benefits or penalties for accessing retirement funds early can significantly impact people’s decision-making, depending on their financial position. Announcements made in the budget this week include tax incentives to keep older workers in their jobs. Other mechanisms, such as the money purchase annual allowance (MPAA), can also be manipulated to impact tax liability and encourage people to continue working.
Pull Factors
Intellectual Challenge
The legal sector offers an intellectually stimulating environment, and over the 50s who enjoy mental challenges and the opportunity to make a difference in people’s lives may be attracted to this sector.
Pursuit of Meaningful Work
Many older workers are looking for new opportunities to engage in meaningful work, either in the same field or in a new one. This can be an important factor in their decision to return to work.
Professional Development
Some workers over 50 are looking for new career opportunities or to develop new skills. Continuing to work can provide opportunities for professional development, allowing them to stay engaged and relevant in the workforce.
Social Interaction
The legal sector is a highly social environment, and returning to work can provide opportunities for social interaction and building relationships with colleagues.
Flexibility
Hybrid working practices provide greater flexibility in how people work, which allows people the opportunity to work whilst retaining the freedom to enjoy life away from work – the very reason they might have left work originally.
Benefits of older workers
One of the key benefits of having older workers in the legal sector is their wealth of experience and knowledge. Older lawyers have spent decades honing their legal skills and building relationships with clients, making them valuable assets to any law firm. They have a depth of experience that younger lawyers simply cannot match, and they can provide valuable mentorship and guidance to their younger colleagues.
Another advantage of hiring older lawyers is that they tend to have a strong work ethic and a sense of professionalism. They have a reputation for being reliable, responsible, and dedicated to their work, which is essential in a profession that requires a high degree of trust and integrity.
Furthermore, older workers often have a more balanced perspective on work-life balance. They have already gone through the phase of building their careers and are often more interested in achieving a work-life balance that allows them to pursue other interests outside of work. This can lead to a more harmonious work environment, as they are less likely to engage in cut-throat competition and workaholic tendencies that can sometimes plague younger lawyers.
The challenges
Despite laws prohibiting age discrimination, it remains a pervasive issue in the workplace. Many older workers face stereotypes that they are less productive or less technologically savvy than younger workers. This can make it difficult for older workers to find employment or to advance in their careers.
As technology continues to evolve in the sector, many lawyers require more advanced technical skills and older professionals returning to work after a period of unemployment who have not kept up with these changes may find it challenging to learn new technologies and systems.
Retirement planning is another area that can be impacted by a return to work, particularly if someone has already started to draw on their retirement savings. Workers may need to adjust their retirement plans if they plan to continue working, which can be challenging if they have not saved enough to support a longer retirement.
For legal firms, the challenge sits with balancing the workforce and having enough experienced partners and fresh associates to optimise client acquisition and retention whilst maximising billable hours and managing costs. If too many partners retire without the talent and experience to replace them, firms risk losing clients or not being able to generate sufficient revenue from those they serve.
Enticing retired lawyers back to work can be an expensive exercise and they must want to return to a working reality they had already decided to leave behind. If they don’t, increased competition for less experienced lawyers and the resulting wage inflation will continue to cause challenges for firms across the sector.
More over 50’s on the road ahead
While returning to work can provide financial benefits and opportunities for personal growth, there are also challenges associated with this trend. Employers can help address some of these challenges by providing age-inclusive policies and practices, such as flexible work arrangements, training opportunities, and mentorship programs. Workers can also take steps to address these challenges, such as seeking out training opportunities, networking with colleagues, and seeking support from family and friends.
The trend of older workers returning to the labour market is likely to continue, particularly in the legal sector. While there may be some questions associated with hiring older lawyers, the benefits of their experience, knowledge, and professionalism potentially outweigh any perceived drawbacks. Law firms that embrace this trend and create a welcoming and inclusive environment for older lawyers are likely to reap the rewards of a diverse and multi-generational workforce.
Lawyers at arch.law enjoy the ultimate flexibility, with the freedom to develop working patterns that fit their lifestyle without compromising on client service. We believe this flexibility is a highly valued element of what sets us apart and a great tool in attracting experienced lawyers to remain or return to practice. Our clients receive tailored legal solutions delivered by highly qualified and engaged professionals that combine legal expertise with technology to drive the best results.
