Lets talk about… Proposed tax breaks for over-50s returning to work.
The impacts of covid led to a wave of over-50s employees taking early retirement. However, UK ministers are reportedly keen to see these valued employees returning to the workplace. As a result, the government is considering proposals to give over-50s tax breaks for returning back to work after a career break.
Naturally, there is a lot of debate surrounding this topic:
Is this a good idea?
Do we need more over 50’s in the workplace?
Are tax breaks the right way to go?
Or should we all be aiming for early retirement?
We invited the Harper Fox Partners senior leadership team to share their thoughts:
Scarlett Allen-Horton, Business Director:
We, of all people, understand how important it is to encourage over 50’s back into the workplace. We know there is a clear skills gap and a shortage of skilled workers in the UK and actually the skills that experienced employees offer is invaluable for the workplace, engagement of teams and the wider economy. However, I assume this initiative would generally impact the people that are in a better financial position whereby they can retire earlier? So, it does feel a bit concerning for me that it may not be benefiting people that are still working hard, even if they wanted to retire earlier.
Unfortunately, within recruitment and executive search, some employers are still asking the ages of candidates. We really need to turn that around and realise that a lot of these candidates bring phenomenal and highly valued experience to the table. Plus, a work ethic that's actually unmatched by a lot of the more junior candidates these days, that's the reality of things. So, I believe a focus on attracting over-50’s talent into business would not only really help with age discrimination and the skills gap, but their great knowledge base is key, we must ensure that this community of employees feel really valued in the workplace- it’s crucial for the success of all.
As businesses we also need to take responsibility and consider ways we could encourage over 50s back into the workplace. We can't offer tax breaks as employers but there are things that businesses could do themselves. For example, offering skills workshops, flexible working or return to work sessions; trying to understand why people have retired earlier and offering incentives to return. There are great benefits for over 50‘s as well, for example we know loneliness and isolation is an issue for retirees.
Another consideration is semi-retired flexible work patterns. Many retirees have the skill sets and the experience needed, these individuals who are proven could come in to coach and mentor people that are less experienced than them. This would provide a balance of participating in the workplace and enjoying their well-earned personal time. Overall, we should really be enabling people to come in to share their skills and to be respected in the environment for the knowledge that they bring. This obviously helps with bridging some of the skills gap as well.
Luke Munday, Business Manager:
The main point for me, is that ensuring that it's fair across the board, so if it's purely just for those that are returning to work that's a massive red flag for me. The people that generally would have taken early retirement are those that you'd assume have better financial security. So, you would need to consider the reaction from the rest of the market. Especially with the cost-of-living crisis and the mortgage rises that we're experiencing. I’m sure all generations would appreciate a tax break. Having said that, if it's done fairly and going to encourage and reduce the age gap then I'm all for it.
One thing I’d like to see if the government did proceed with this incentive, is for employers to actually spend time with those returning to work, to go through relevant training and skills workshops. It really is down to the employer to invest that time into upskilling and refreshing returners.
I think it's fair to say in a lot of instances, particularly in industries that advance quickly, the excuses for not hiring more mature candidates are generally around upskilling. For example, new technology they've got to learn or new guidance and practices that have come into place. But what we should be thinking is, let's utilise the knowledge that they already have and give the time to go through that relevant training.
Elaine Hickman, Head Of Candidate Research:
I think it's a really good idea to bring the over 50s back into the workplace. With COVID, when everything shut down, I believe a lot of people stopped working, took time for themselves and thought, this is a great lifestyle. So, it came down to being able to continue to afford to do that and taking early retirement if possible. The question is, how are we going to get those people back into work?
I think the tax benefit is a good idea, but I believe it needs to be fair for all. I'm over 50 and I'm still working and I carried on working all the way through COVID, like many others my age. I feel it would be unfair for those over 50 and currently in work if the tax break was only offered to those over 50 coming back into work.
I believe the government would also have to look at everybody, particularly those that are on lower salaries. The care system for example, is on its knees, it doesn’t have enough people, and Brexit had a real impact on this. So, if this initiative aims to tackle skills shortages, there should be wider considerations for tax breaks, not just over 50’s. I think we're all in agreeance something needs to be done but it really does need some sort of innovative approach from the government.
There are things employers can do too, for example they should start offering part time or flexible working if they are not already offering this. Or perhaps we can look to offer over 50’s training or knowledge share type consultancy roles where appropriate.
Kam Mahi, Leadership Consultant:
I believe, yes, we should look to welcome back those who have taken early retirement. However, we should definitely ensure we help people ease into coming back to the workplace, rather than just pushing them straight in. There is a lot of emphasis on career progression, especially with the younger generation which is understandable. With this in mind, it would be great to bring in more mature generations to share their values, life skills and knowledge.
Knowledge sharing is brilliant. I believe that it is something that can definitely be used on a training basis as well. Whether it be workshops, or actually on the job, out in the field, on site or in meetings there is so much experience to tap into and share what has been learned throughout their careers.
Henry Allen-Horton, Senior Leadership Consultant:
Overall, I believe it's a good idea to bring the over 50s back to work if possible. I think that generation have invaluable experience which would be beneficial, especially where in a lot of sectors there's a talent shortage at the moment. Dependant of the specifics, the initiative also has potential to boost the economy, which is of course, helpful to all.
Looking at it from a recruiter perspective, encouraging more over 50’s back into the workforce would increase the talent pool size from which we can recruit. For employers, this would improve the potential of hiring quality, more diverse talent, in a shorter time frame.
However, I do believe that any tax breaks would need to be considered carefully and as fairly as possible. I think that it would be quite tricky to put something into place that will be fair for everybody, so that’s certainly a consideration.
Amy Blount, Marketing Business Manager:
I am absolutely all for having more over 50’s in the workplace. Whether that’s through tax incentives or improved inclusivity initiatives in the workplace, is up for debate. However, something that would need to be considered is that in certain industries, knowledge and skills requirements are constantly changing or being updated. Therefore, if someone had been out of work for a certain period of time would their knowledge now be out of date? This would not be the case for all industries, of course, but it’s definitely a consideration in terms of return-to-work training.
One overwhelming positive I can see is that it would bring a nice dynamic to teams. We talk a lot about inclusivity and diversity as a business and bringing in more people over 50 would certainly bring unique dynamics to teams. New topics of conversation, different considerations for business discussion, all of those great things that come with having a more diverse workforce.
In addition, all of the inclusive initiatives we've seen being put into place, flexible working in particular, not only benefit the over 50’s, but would also benefit others. For example, parents and carers or people that have disabilities or mental health concerns. Adapting workplaces to be more inclusive of more mature generations would ultimately be a great benefit for all.
About Harper Fox Partners:
Harper Fox Search Partners are a purpose led business, providing leadership talent and executive search solutions for the global energy, engineering, technology manufacturing, transport and utilities sectors. Get in touch today to find out how we can add outstanding value to your business.
