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Jobs Scarcity for Older Aussies Increases Pension Poverty Risks

QUEENSLAND, Australia – The unemployment rate among older Australians is on the rise much faster compared to the general community.

The current job drought for older workers in Australia is posing a greater risk of pension poverty in the country. Ageism is becoming rampant in the country, and older Australians are missing out on opportunities to continue joining the workforce in hopes to level up their finances further. This issue is currently seeing the hopes of older workers for a more dignified and secure retirement evaporate, according to the Labor Party leader Anthony Albanese.

Mr. Albanese stated on Wednesday during an interview with the Queensland Media Club that at the moment, there are more than 170,000 Australians from ages 55 to 64 years old that are receiving unemployment benefits when they could still take advantage of some job opportunities to build and earn more for their retirement nest eggs.

Based on the latest figures published by the Australian Bureau of Statistics (ABS), there has been an increasing number of aged Australians that are currently out of work compared to five years ago. The figures show such results despite the fall in the country’s unemployment rate.

The ABS figures show that despite the number of unemployed Australians in the general community, has gone down by 5.5% on December 2019 compared to December 2014, the number of aged Australians currently out of work has gone up by 7.8% during the same period.

The difference between the rate of aged Australians to the general community is even steeper when it comes to underemployment. As defined by the same ABS data, the underemployment sector is characterized by Australians between the age of 15 and up who are currently working below 35 hours every week but wants to increase their working hours.

Overall, the underemployment in the country on the general community has gone up by 7.6% over the five years ending December 2019. Meanwhile, the underemployment rate of aged Australians during the same period has increased to a staggering 21.2%.

According to Mr. Albanese, a Labor insightful kind of government should be focused on building and developing skills for its older citizens. He said that it would be possible through vocational education and course efforts that could be driven by an up and coming agency in the country, the Jobs and Skills Australia.

Michaelia Cash, the Employment Minister, has previously stated that the Australian government has already put in place a similar organization, which is the National Skills Commission.

Meanwhile, the chief executive of the Australian Institute of Superannuation Trustees, Eva Scheerlinck, stated that older Australians are strongly-armed into going out of the workforce earlier than they would like.

She further stated that there are at least 40% of Australians who don’t have a personal vote as to when or what age they are going to retire. Ms. Scheerlinck also said that most of these people had experienced some discrimination in their workplace.

A research conducted in collaboration if AISAT and the Australian Centre of Financial Studies in 2014 have also shown the rate of workplace discrimination for aged workers. According to the findings, there are around 46% of aged Australians, workers who are aged 55 and up, who are most likely going to go through job search exclusion compared to the 30% of workers between the age of 45 and 54 years old experience the same exclusion.

Ms. Scheerlinck further explained that a lot of aged Australians are continually trying to remain in the workforce. However, according to her, most of them don’t have any job prospects or opportunities offered or available to them.

Also, women are losing job opportunities due to redundancies in the workforce. Australian workers who are in their 40s are also experiencing work search exclusion, with women workers largely affected by the issue.

According to a demographer at the Australian National University, Liz Allen, she has seen a lot of women in the country who are in their mid-40s who have been gravely affected by redundancies in the workplace. She said that most of these women look financially able, but most of them are cannot get back their feet into the workforce.

Dr. Allen further stated that at 45, people in the workforce are being treated as too old, which, according to her, is extraordinary. The entire population is getting older, but she said that everyone is effectively discriminating themselves.

She added that despite the country having a law against ageism or discrimination based on a person’s age, it is still rampant anyway.

Meanwhile, the chief advocate of the National Seniors Australia, Ian Henschke, stated that the increasing possibility of unemployment for aged Australians poses a growing risk to their retirement prospects. He said that there is a rising number of people in their 40s and 50s who are losing their jobs and leaving them unable to land new ones.

Mr. Henschke further explained that when older Australian can’t find new jobs, it will hinder them from contributing to their super accounts, increasing their chance of facing poverty during retirement. He said that it is especially the case for aged Australians who don’t own their homes.

Mr. Henschke also pointed out the figures from a National Seniors data that shows the rate of Australians over 65 years old who are homeowners is expected to drop to 74% from its current 76% in 2026. It is in line to drop even lower by 2036 at 70%, 64% by 2046, and much a much lower 57% by 2056.

Australia is currently at one of the bottom-performing countries in terms of keeping its citizens out of poverty during their retirement compared to other OECD countries.

According to Mr. Henschke, around 23.5% of Australian pensioners are currently in poverty, with only 12% recorded in Canada, and a much lower 10.5% in New Zealand. The high rate of pension poverty in the country came despite Australia having one of the highest age pension out of other OECD countries.

The less than stellar figures in pension poverty in Australia are largely due to the harshness of assets test and income, which gives lower incentives for Australians to work when they start receiving their pension, according to Mr. Henschke.

Further, Dr. Allen added that the government needs to look more into finding ways to keep Australians in the workforce much longer.

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callum

Aussie copywriter from Melbourne's Dandenong Ranges, passionate about all things lifestyle - particularly Finance.

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