Levels of mature age participation

Paid work

2.67 The rate of mature age labour force participation has changed over time. In recent years, the labour force participation rate has generally been trending upwards for both mature age men and women, particularly at older ages.^[95] However, the change in participation rates for men and women has followed different trajectories over time.

2.68 Older men’s labour force participation rate was high in 1966, declined through the 1980s and 1990s, and has increased in the 2000s (with the exception of men aged 45–54, whose participation rate remained relatively steady).^[96] The labour force participation rate for men aged 45–54 was 96% in 1966. This has since declined, fluctuating between 87% and 90% from the mid-1980s to 2011. At 2011, the participation rate stood at 88%.^[97] For men aged 55–64, the participation rate was also high in 1966, at 86%. It declined to a low of 60% in 1997. Since then, the labour force participation rate of men in this age range has increased to 72% in 2011.^[98] In 1966, the labour force participation rate for men aged 65 years and older was 23%. This fell to a low of 8% in 1993, before increasing to 16% in 2011.^[99]

2.69 In contrast, the labour force participation of mature age women was at its highest point in 2011, having increased from relatively low levels in 1966. In 1966, women aged 45–54 had a labour force participation rate of 37%. This has generally increased since then, reaching 54% in 1986 and 78% in 2011. Women aged 55–64 had a labour force participation rate of 21% in 1966. This increased to 25% in 1972, before declining to 20–21% in the mid-1980s. Since then, their participation rate has increased significantly to 55% in 2011. The participation rate of women aged 65 years and older remains low, standing at 4% in 1966 and 7% in 2011.^[100]

2.70 Persons are less likely to be employed full-time and more likely to engage in part-time work at older ages. The ABS notes that, in the year to June 2010:

two-thirds of men aged 55–59 years were employed full time, declining to 44% of those aged 60–64 years, and 18% for those aged 65–69 years. By contrast, the rate of part-time work among older men actually increases with age, from 10% of men aged 55–59 years, to 13% of those between the ages of 60 and 69 years.

The proportion of women employed full time also declines with age, though from a smaller base than for men. In the year to June 2010, 35% of women aged 55–59 years worked full time compared with 18% of women aged 60–64 and 6% of those aged 65–69 years. As with men, in progressively older age groups women who work part time make up a greater share of the shrinking number of labour force participants.^[101]

2.71 Participation for both men and women aged 55–64 in Australia is higher than the OECD average. However, it is lower than a number of OECD countries, including New Zealand, United States and United Kingdom.^[102]

Unemployment

2.72 Persons aged 45 years and older have a longer duration of unemployment than younger unemployed persons. At May 2012, the average duration of unemployment for persons aged 45 years and older was 62 weeks.^[103] This compares with 34 weeks for persons aged 25–44 years, and 24 weeks for those aged 15–24 years.^[104]

Older persons not in the labour force

2.73 At September 2009, 3.3 million persons aged 55 years and over were not in the labour force. Of these, 1.6 million were aged 55 to 69 years.^[105]

2.74 For persons aged 55–69, 40% of those not in the labour force were retired or voluntarily inactive. Another 26% (mostly women) listed their main occupation as ‘home duties’. A further 15% of persons not in the labour force reported long-term health or disability. The ABS notes that 13% of persons aged 55–69 who were not in the labour force reported that they would like to work.^[106]

Determinants and trends in mature age participation in the paid workforce

2.75 The labour force participation rate of mature age men in the 1980s and 1990s was particularly affected by economic and industry restructuring.^[107] Mature age male workers were often targeted for retrenchment in sectors, such as manufacturing, affected by restructuring.^[108]

2.76 By contrast, the increase in women’s labour force participation is attributed to the ‘cohort effect’ of women who joined and remained attached to the labour force at younger ages and who have now entered mature age.^[109]

2.77 Commentators have suggested that a range of additional factors have contributed to more recent increases in mature age labour force participation. These factors are related to both labour force supply and demand, as well as social and demographic changes, and include:

• increased demand for labour since the mid-1990s;^[110]

• persons affected by retrenchments in the 1980s and 1990s ageing out of the main working ages;^[111]

• work is less physically demanding, with the shift from blue-collar work to professional and paraprofessional jobs;^[112]

• increasing education levels;^[113]

• successive cohorts have commenced work at a later age and therefore will continue working longer;^[114]

• the effect of the Global Financial Crisis on retirement savings, leading some mature age persons seeking to remain participants in the labour force;^[115] and

• better health at older ages.^[116]

2.78 A number of these factors can be seen to be related to broad policy developments, such as the promotion of better health and education outcomes. However, none of these are specifically related to policies targeted towards mature age participation.^[117] Rafal Chomik and Professor John Piggott suggest that ‘even if government does not act, improvements in health, work conditions and education will continue to affect the participation of older workers’.^[118]

2.79 It is important to note that, while the broad trend is toward increased labour force participation at older ages, particular groups are affected differently. For example, employment levels are lower for those whose competency in English is low.^[119] For workers who are employed in blue-collar jobs, poor health and an inability to continue to meet the physical demands of a job may contribute to workforce exit.^[120] In addition, those without a post-school qualification are less likely to be in the workforce at older ages than those with such a qualification.^[121]

Other productive work

Mature age carers

2.80 According to ABS statistics, mature age persons provide the majority of informal care for persons with disability or persons aged 60 years and older. In 2009, 62% of total carers were mature age. Mature age persons also comprised 70% of primary carers (the person who provides the most ongoing assistance to a care recipient) for persons with disability or aged 60 years or over.^[122]

2.81 Mature age women undertake proportionally more care then mature age men. In 2009, women made up 54% of total carers in the mature age bracket, and 64% of mature age primary carers.^[123]

2.82 Grandparents also provide a significant proportion of child care for grandchildren. ABS data suggests that ‘around a quarter of all children (26%) were usually cared for by their grandparents’.^[124] Research in 2011 suggested that grandmothers were more likely than grandfathers to perform child care daily or several times a week, while grandfathers were more likely than grandmothers to be doing care a few times a year or less often.^[125]

2.83 Some mature age persons also provide ‘parental’ care for dependent children. However, with the exception of grandparents providing such care, the ALRC has not considered this aspect of care work in this Inquiry.^[126]

Mature age volunteers

2.84 ABS data suggests that 36.2% of persons aged 18 years and over participate in voluntary work in Australia.^[127] Mature age persons provide a significant amount of voluntary work, with approximately 43% of those aged 45–64 doing volunteer work.^[128] Additionally, approximately 37% of persons aged 65–74 and 28% of persons aged 75–84 are volunteers.^[129]