Life at older ages will look very different for women in the early 2020s than it does today. They are likely to be healthier, their husbands will live longer, and they will be much more likely to be in paid work.
These are among the main findings of The Changing Face of Retirement, a new report published last week by the Institute for Fiscal Studies (IFS). The study projects the demographic and financial circumstances of those aged 65 and over in England up to 2022–23.
The report also reveals that:
- The health of older women is improving. Within each age group the proportion of women with no substantial health problems is projected to rise by more than 5%.
- Employment rates for women in their late 60s, already at their highest level for forty years, are set to increase faster and approach, or even overtake, men’s in the early 2020s.
- The projected increase in employment rates of older women is driven by improvements in health and, in particular, the rise in the female state pension age from 60 in 2010 to 66 in 2020. The additional female workers are drawn predominantly from women in good health.
- Incomes for the poorest pensioners will grow by about 1% per year in real terms, assuming their state pensions and benefits rise as currently planned. As both earnings and private pensions are forecast to grow faster than this, income inequality among those aged 65 and over is projected to grow.
“Employment rates for women in their late 60s will increase further and faster over the next few years, approaching or even overtaking those among men of the same age,” said Katy Heald, an author of the report. She added: “This reflects improving health, as well as being a response to the rising state pension age. Of course while increasing earnings will boost the incomes of these women, longer working lives will not necessarily leave them better off in a broader sense”.
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