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lmost half of individuals aged between 50 and 70 who left the workforce in the course of the first 12 months of the pandemic ended up in relative poverty, in accordance with the Institute for Fiscal Research (IFS).
New IFS analysis, funded by the Joseph Rowntree Basis, revealed 48% of individuals on this age bracket who stopped work in 2020–21 have been in relative poverty, although total poverty charges declined that 12 months.
The report warns that older individuals who cease working usually by no means re-enter the workforce, that means this group could also be experiencing long-term poverty and higher hardship amid the cost-of-living disaster.
Relative poverty refers to folks dwelling in households with revenue under 60% of the median in any respective 12 months.
Based on the analysis, many older individuals who left work within the first 12 months of the pandemic have needed to minimize their meals expenditure by round £60 per week.
Additionally they struggled extra with their total well-being and have been much less prone to obtain a pension than those that had stopped working in earlier years.
The analysis, which has been launched forward of the forthcoming IFS annual report on dwelling requirements, poverty and inequality, suggests labour market disruptions and the early impacts of the pandemic might have “pressured” many employees into early retirement.
Xiaowei Xu, a senior analysis economist at IFS and an writer of the analysis, mentioned: “It’s usually assumed that older individuals who left the workforce in the course of the pandemic have been rich people retiring in consolation.
“Our evaluation exhibits that those that left within the first 12 months of the pandemic skilled a pointy rise in poverty, regardless of total poverty charges falling that 12 months, and likewise suffered giant falls in well-being.
“A few of this group may nicely be amenable to coming again into the workforce with the suitable alternatives, and there are indicators that some are returning already.
“If the Authorities needs to get this group again to work, the success of insurance policies to help older employees, such because the mid-life MOT, will probably be vital.”
