Re-education could save retirement

Australia’s ageing population brings with it the probability of increased unemployment of older Australians and further reliance on the Age Pension. So how do we prevent this from occurring? Professor Chris Phillipson, sociologist and former Executive Director of the Manchester Institute for Collaborative Research on Ageing (MICRA), believes that midlife education could be the key.

Professor Phillipson proposes that, once people reach a certain age, there should be an entitlement to some sort of learning ‘top-up’. For example, when you reach your 50th birthday, you’d receive a voucher for re-education, to enrich and reskill you for the second half of life.

Recent research backs up the potential efficacy of this concept. It shows that people aged 50 to 69 years who have a non-school qualification were more likely to be employed than those without such qualifications.

So by introducing a system of midlife retraining, we could improve the employment prospects for older Australians and do away with the notion that older people have passed their prime in the workplace.

But how do we do that? 

We could explore the option of the Government providing some sort of midlife ‘voucher’ system for retraining. Many Australians involved in manual employment could then be retrained in fields such as management, administration, technology or education, to minimise physical strain in later years. This would also reduce the projected ‘brain dump’ that may take place once baby boomers retire.

It could also mean that older people could reduce their working hours to a point where they can work fewer hours and receive an Age Pension, but still be making a valuable contribution to society and the economy.

A report by the Actuaries Institute, released in July 2016, predicted increasing numbers of Australians who will deplete their superannuation fund before their deaths. By enabling older Australians to remain employed in later life, it would allow them to keep contributing to superannuation, preventing them from running out of super in later life.

But why should the Government be responsible for providing free, or subsidised, midlife education? Well, if the Government is determined to raise the eligible age for the Age Pension, it should be obliged to assist older people by increasing their employability. There would also be a reduced burden on the health system and a huge bump to our economy. The most recent PwC Golden Age Index found that by employing more Australians aged over 55, we would see a $78 billion annual boost to our economy. It would also improve the quality of life for many older people who suffer from post-retirement social isolation.

Another alternative could be increasing corporate responsibility for midlife retraining, providing flexible hours, education and support to older employees and keeping an experienced workforce with knowledge that could then be passed down to younger workers.

Universities could also play a part by introducing an extension of post-graduate training that includes re-education after a certain number of years in the workforce, thus keeping former students up-to-date with advancements in their chosen field and minimising the chance that their qualifications will be superseded.

The potential benefits go beyond economic factors, including improved health and less reliance on the health-care system. By keeping our brains active, we reduce the risk of developing Alzheimer’s and other cognitive dysfunction. There would be lower incidents of depression due to social isolation and we would improve the overall view of older people being a ‘burden’ on the economy and society in general, thus reducing age discrimination.

Jeremy Thorpe, PwC economics and policy partner, said that countries with the highest number of people aged over 55 in the workforce, such as Iceland and New Zealand, had employed similar initiatives.

Mr Thorpe said these countries encourage later retirement, thus incentivising people to work longer. These same countries also provide more opportunities for lifelong training, ensuring that workers have the necessary skills to stay relevant in the workplace.

“If people above 55 are employed for longer, they are less of a drain on the pension system, they’re productive, so they’re adding economic wealth to the country,” said Mr Thorpe.

Professor Phillipson believes we need to see a change in how Government money is allocated for education across the life course, to reduce reliance on the Age Pension, the health system and provide a better quality of later life.

If you had the opportunity to be re-educated after 50, would you take it? If so, would you change careers, or improve your skills in your existing area of work? Do you think it would extend your working life? Considering the Government’s intention to raise the Age Pension age and its complaints about having to fund the future of older Australians, do you think this is a good idea?

Related articles:
Is ageing our biggest threat?
State adult education organisations
Why studying could be good for you

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