London Daily

Focus on the big picture.
Monday, Sep 29, 2025

Cost of living crisis may have driven record numbers of pensioners back to jobs

Cost of living crisis may have driven record numbers of pensioners back to jobs

Since the end of the pandemic and the reopening of economies around the world, labour markets have become tighter, in the jargon.

In short, in developed economies such as Europe and the United States, there are fewer workers available.

Much of this was put down to the so-called great resignation as workers decided, after the pandemic, not to return to work.

That could have been for a number of reasons, including so-called long COVID or the need to care for relatives suffering from long-term symptoms of the virus, but the biggest driver is thought to be because a number of people reappraised their lives. They decided they could afford to retire and were happy to do so.

That latter factor in particular was used to explain why, between the final three months of 2019 and the final three months of 2021, some 493,000 Britons aged 50 or over dropped out of the labour force.

Intriguingly, however, data released on Monday suggests that some of those workers may now be returning to the jobs market.

The Office for National Statistics (ONS) reported that, during the three months to the end of June, the number of people aged 65 and over in employment increased by a record 173,000. It said a record 1.468 million people aged 65 and over are now in work.

It suggested this was due to a rise in part-time working and especially in "the industries where informal employment is more common, such as hospitality and arts, entertainment and recreation".

The ONS said that, of the 173,000 older workers joining the labour force during the quarter, 85,000 were part-time employees and a further 76,000 were part-time self-employed people.

Its figures suggest that, statistically speaking, someone aged 65 or over who is still working is far more likely to be working part-time than full-time.

Accordingly, because most such workers returning to the labour force are working part-time, the average number of hours typically put in by someone aged 65 or over is actually falling. Typically such workers put in between 16 and 30 hours a week.

What the ONS did not look into in this survey is why such workers are returning to the labour force in such numbers.

It is tempting to speculate that many older workers have decided that working on a part-time basis, when they can enjoy a little flexibility, is good for the soul. Many of them will have been hearing increasingly, towards the end of their careers, about the importance of work-life balance.

Another likely factor is that employers are doing more to lure back older workers by, for example, offering them flexible working.

They are also offering higher wages than previously: the ONS reported recently that, in June, one in eight businesses raised wages - and that rose to nearly one in four in those industries, such as hospitality and healthcare, where part-time working is established.

The chances are, though, that in most cases this return to the jobs market is being driven by the cost of living crisis.

A lot of people living on fixed incomes, either occupational or state pensions, will have found that those incomes do not go as far at a time when the headline rate of inflation is more than 10%.

Others, typically those on defined contribution - "money purchase" in the jargon - pensions, will have noted how their retirement savings have been eroded by this year's reverses in the stock market and come to the conclusion that they, too, need to supplement their retirement savings.

Either way, it is a development that will be welcomed by the government, not to mention employers.

Dame Sharon White, the chair of the John Lewis Partnership, recently called on ministers to do more to encourage older workers back to the labour force to ease strains in the jobs market.

Dame Sharon, an economist who earlier in her career was a former senior official at HM Treasury, argued that the shortage of older workers was feeding inflation because it was creating skills shortages.

So this development will also be welcomed by the Monetary Policy Committee at the Bank of England which, next week, is expected to vote to raise interest rates again.

Newsletter

Related Articles

0:00
0:00
Close
Trump Announces Intention to Impose 100 Percent Tariff on Foreign-Made Films
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Singapore and Hong Kong Vie to Dominate Asia’s Rising Gold Trade
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Manhattan Sees Surge in Office-to-Housing Conversions, Highest Since 2008
Switzerland and U.S. Issue Joint Assurance Against Currency Manipulation
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Thomas Jacob Sanford Named as Suspect in Deadly Michigan Church Shooting and Arson
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
New York Man Arrested After On-Air Confession to 2017 Parents’ Murders
U.S. Defense Chief Orders Sudden Summit of Hundreds of Generals and Admirals
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
Trump Claims FBI Planted 274 Agents at Capitol Riot, Citing Unverified Reports
India: Internet Suspended in Bareilly Amid Communal Clashes Between Muslims and Hindus
Supreme Court Extends Freeze on Nearly $5 Billion in U.S. Foreign Aid at Trump’s Request
Archaeologists Recover Statues and Temples from 2,000-Year-Old Sunken City off Alexandria
China Deploys 2,000 Workers to Spain to Build Major EV Battery Factory, Raising European Dependence
Speed Takes Over: How Drive-Through Coffee Chains Are Rewriting U.S. Coffee Culture
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Ringo Starr Champions Enduring Beatles Legacy While Debuting Las Vegas Art Show
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
FBI Removes Agents Who Kneeled at 2020 Protest, Citing Breach of Professional Conduct
Trump Alleges ‘Triple Sabotage’ at United Nations After Escalator and Teleprompter Failures
Shock in France: 5 Years in Prison for Former President Nicolas Sarkozy
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
BNP Paribas Abandons Ban on 'Controversial Weapons' Financing Amid Europe’s Defence Push
Typhoon Ragasa Leaves Trail of Destruction Across East Asia Before Making Landfall in China
The Personality Rights Challenge in India’s AI Era
Big Banks Rebuild in Hong Kong as Deal Volume Surges
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Arnault Denounces Proposed Wealth Tax as Threat to French Economy
Study Finds No Safe Level of Alcohol for Dementia Risk
Denmark Investigates Drone Incursion, Does Not Rule Out Russian Involvement
Lilly CEO Warns UK Is ‘Worst Country in Europe’ for Drug Prices, Pulls Back Investment
Nigel Farage Emerges as Central Force in British Politics with Reform UK Surge
Disney Reinstates ‘Jimmy Kimmel Live!’ after Six-Day Suspension over Charlie Kirk Comments
U.S. Prosecutors Move to Break Up Google’s Advertising Monopoly
Nvidia Pledges Up to $100 Billion Investment in OpenAI to Power Massive AI Data Center Build-Out
U.S. Signals ‘Large and Forceful’ Support for Argentina Amid Market Turmoil
Nvidia and Abu Dhabi’s TII Launch First AI-&-Robotics Lab in the Middle East
Vietnam Faces Up to $25 Billion Export Loss as U.S. Tariffs Bite
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Indonesia Court Upholds Military Law Amid Concerns Over Expanded Civilian Role
Larry Ellison, Michael Dell and Rupert Murdoch Join Trump-Backed Bid to Take Over TikTok
Trump and Musk Reunite Publicly for First Time Since Fallout at Kirk Memorial
Vietnam Closes 86 Million Untouched Bank Accounts Over Biometric ID Rules
Explosive Email Shows Sarah Ferguson Begged Forgiveness from Jeffrey Epstein After Taking His Money
×