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Rich guy retires (sort of)

At the beginning of February, Jeff Bezos announced that he was going to stand down as CEO of Amazon. 

He said: “Being the CEO of Amazon is a deep responsibility, and it’s consuming.” He is going to remain as executive chair, and plans to “stay engaged in Amazon initiatives,” but also put his energy into his “other passions, like the Day 1 Fund, the Bezos Earth Fund, Blue Origin and The Washington Post,”among others. Good for him.

Jeff Bezos is 57 and worth around $186 billion. 

He’ll be just fine, but what about other workers in their 50s, for whom retirement, or semi-retirement, is not an option?

There are huge pressures on the middle-aged workforce; these are multiplying and the effects of Covid, have exacerbated them, to the point of making anyone over the age of 50 potentially surplus to requirements.

The machines of the Industrial Revolution destroyed the way our ancestors worked and today’s technology is disrupting our work patterns equally profoundly. 

Prior to lockdown, the world of work was undergoing change because of this digital revolution, because of artificial intelligence (AI) and also globalisation.

The current economic revolution and lockdown mean the world of employment is precarious. Those who feel their jobs are secure will probably have to get used to lower wages (wage stagnation is currently rampant) and the share of income flowing to workers (as opposed to owners), has plummeted. Among the workers, too, there is increased inequality, with the share of income going to the highest earners, increasing exponentially.

In America, the share of adult men of prime working age who are working or actively looking for work has fallen steadily, over the last generation. Among all men, the rate of participation in the workforce dropped from around 76% in 1990 to 69% in 2015, a difference of about 9 million.

Those squeezed out of work find their lives upended. With few prospects, many struggle to find purpose and satisfaction in life; indeed, recent research has turned up an alarming rise in mortality since the late 1990s among middle-aged Americans, mostly accounted for by an increase in suicides and in drug and alcohol abuse. 

In the UK, a third of people in their fifties and sixties, feel disadvantaged by their age when applying for jobs. A new report, by the Centre for Ageing Better, says older workers are being trapped in insecure employment, or forced into early retirement. Since the start of lockdown, the number of 50-64 year-olds, out of work, has increased by 175,000 and ageism in recruitment prevents many of them returning to the workplace.

In the UK, there are 407,000 unemployed over-50s, representing one in four (24%) of the total unemployment figure. Around 10% of over 50s are unemployed globally (OECD). This figure is reflected in the US, where, again, around 10% of over 50s are unemployed. 

The report says employers should tackle ageism at all stages of the recruitment process, or they risk missing out on the skills and experience older workers bring.

One in five older workers say they have experienced ageism and have been turned down for a job because of their age and a third have been told they are unlikely to be successful because they have too much experience.

Those from black and minority ethnic backgrounds are more likely to have reported recent age-based discrimination. Once they lose a job, the over 50s are twice as likely to fall into long-term unemployment, compared with younger workers.

Work is not there just so that we can earn money, it is a source of personal identity, giving structure and purpose to our lives and the march of technological progress is adding to the strain in three main ways.

The first is automation, where new technologies are replacing certain sectors, from clerks to welders, from drivers to paralegals.   

The second transforming force is globalisation, where powerful IT systems have enabled an integrated world economy.

The third force is the increased productivity that technology has gifted individual workers, meaning fewer skilled workers are required; fewer lecturers, fewer medical staff, lawyers and researchers.

We have, at a global level, an abundance of labour and the key is in how it is distributed and it would seem that those over the age of 50, are simply too well qualified and overpaid to take their share.

Rod Bailey, CEO of ExecutiveSurf, says: “We also have a massive skills gap. IT may have usurped traditional jobs, but it has created new ones. In many cases these new ones pay no heed to location and often are completely agnostic to age. The first and hardest step is to change your mindset. The Knowledge Economy is not the exclusive domain of Millennials. Neither is the Gig Economy. Think positive, research the skills that are in demand, learn those skills, sprinkle key words all over your cv, remove any mention of age or means of guessing, give examples of your work, pick an hourly rate and market yourself. A stable job is a thing of the past. People born after 1990 don’t even consider it as a possibility. You had that luxury once, you don’t have it any more.”

Governments want these older workers to remain in work, in fact they want them to stay in work until their 70s, at least. The World Economic Forum (WEF), says the retirement age in Britain and other developed countries will need to rise to 70 by the middle of the century to head off the biggest pension crisis in history.

It said that deficits in the world’s six largest pension systems would more than quadruple to $224tn by 2050, unless people worked longer and saved more.

People born today might have a life expectancy of more than 100 and the WEF said the cost of providing security in retirement for a rapidly ageing population is the financial equivalent of climate change.

So people in their 50s and 60s are facing a double-whammy; their experience and knowledge is deemed too expensive for employers and their governments are going to stop providing them with a pension until they reach the age of 70.

At an age when people should expect to be at the pinnacle of their career powers, at a similar age, or younger, than most credible world leaders, talented, experienced and increasingly desperate people are being consigned to the scrapheap, often because of the very developments and innovations, they themselves may have instigated or facilitated.   

So, Jeff Bezos, with his billions, may have options for his selective retirement, but for the rest of us, those over the tender age of 50, faced with unemployment or van-driving, social benefits beckon. 

 

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