Older workers hold on longer

Australia's ageing workforce has no intention of going quietly into retirement, according to new data.

By InvestSMART · 14 Dec 2011

By InvestSMART ·
14 Dec 2011

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Australia's ageing workforce has no intention of going quietly into retirement, according to new data.

AUSTRALIA'S ageing workforce has no intention of going quietly into retirement and says financial concerns are the main reason for staying put, according to new data from the Australian Bureau of Statistics.

A survey found 2.6 million people aged over 45 were in full-time work with 41 per cent looking to shift to some form of part-time work before leaving the workforce entirely.

But 653,800 Australian workers declared that they never intend to retire from the labour force and another 399,300 said they did not know whether retirement was an option.

For the 3.9 million workers surveyed who planned to retire at some stage, 36 per cent said the timing was reliant on the state of their financial security.

The study revealed that of the 8.5 million people in Australia aged 45 years and over, 4.9 million (57 per cent) were currently employed, another 3.2 million (36 per cent) had retired while the remaining 340,300 (4 per cent) did not currently have a job but had not retired.

Personal health or physical ability also influenced retirement decisions for older workers with about 390,000 workers (25 per cent) saying they would leave the workforce when they became eligible for a pension.

About half of Australia's older workers expect their superannuation to be their main source of income at retirement, with another quarter reporting they would rely on a government pension or allowance to survive.

These figures were in sharp contrast to those already retired. Just 17 per cent of current retirees used their superannuation as the main source of personal income with the majority - 66 per cent - using a government pension for the same reason.

The average age at retirement for Australians in the past five years was 61. Workers who intend to retire, plan to do so at almost 63 years of age.

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Frequently Asked Questions about this Article…

Why are older workers in Australia staying in the workforce longer?

According to Australian Bureau of Statistics data, financial concerns are the main reason older workers keep working longer. Many say they need to build more savings or wait for better financial security before retiring.

How many Australians over 45 are still working full-time and plan to shift to part-time before retiring?

The ABS survey found about 2.6 million people over 45 were working full-time, and roughly 41% of them said they expect to move to some form of part-time work before leaving the workforce completely.

How many older Australians say they never intend to retire?

The survey reported 653,800 Australian workers declared they never intend to retire from the labour force, while another 399,300 said they did not know whether retirement was an option.

What do older workers expect to use as their main source of income in retirement?

About half of Australia’s older workers expect their superannuation to be their main source of income in retirement, and roughly a quarter expect to rely on a government pension or allowance.

Is there a gap between what current retirees actually use for income and what workers expect?

Yes. The data shows a contrast: only 17% of current retirees use superannuation as their main personal income source, while 66% rely mainly on a government pension, which is different from many workers’ expectations.

At what age are Australians retiring on average, and at what age do workers plan to retire?

The average age at retirement in the past five years was 61. Workers who intend to retire plan to do so at almost 63 years of age, based on the ABS findings.

How does health or pension eligibility affect older workers’ retirement timing?

Personal health and physical ability influence many decisions: about 390,000 workers (reported as 25%) said they would leave the workforce when they became eligible for a pension, while others indicate health concerns will determine when they stop working.

What proportion of Australians aged 45 and over are still employed versus retired?

Of the 8.5 million people aged 45 and over, 4.9 million (57%) were employed, 3.2 million (36%) had retired, and about 340,300 (4%) did not have a job but had not retired, according to the ABS survey.