EJML Senior workers final

SMALL‐SCALESTUDY

THEIMPACTOFTHECRISISONSENIORWORKERS:CHALLENGESANDRESPONSESBYPES

ISMERI EUROPA

THE IMPACT OF THE CRISIS ON SENIOR WORKERS: CHALLENGES AND RESPONSES BY PES

European Job Mobility Laboratory, November 2011 2

Authors and contributors: Andrea Naldini and Simone Capolupo, Ismeri Europa, Italy; Erhan Őzdemir ,

Applica, Belgium; Maria Petrova, National Employment Agency of Bulgaria and Iskra Beleva, Institute of

Economics, Bulgarian Academy of Sciences, Bulgaria; Timo Baas, IAB, Germany; Danielle Greco, Pôle

Emploi, France; Peter Stoks, UWV, The Netherlands; Izabela Grabowska‐Lusinska, University of Warsaw,

Poland.

The authors also acknowledge the contribution of Agnes Hars, Kopint‐Tarki, Hungary and Begoña Cueto,

University of Oviedo, Spain.

The work of the EJML is supported by the European Union’s Programme for Employment and Social Solidarity – Progress (2007-2013).

This programme is managed by the Directorate-General for Employment, Social Affairs and Inclusion of the European Commission.

For more information see: http://ec.europa.eu/progress



Table of contents

Introduction: older workers in Europe and challenges for PES ......................................................................... 4

1. The European policy context ......................................................................................................................... 6

2. Labour market trends for older workers ....................................................................................................... 9

2. Labour market trends for older workers ....................................................................................................... 9

2.1 Europe is characterised by low levels of employment amongst older workers ..................................... 9

2.2 Recent trends and the impact of the crisis ............................................................................................ 18

2.3 The working situation of older workers ................................................................................................ 21

2.4 Unemployment among older workers and the effect of the crisis ....................................................... 23

2.5 Labour market transitions: the drift into inactivity ............................................................................... 27

2.6 Labour market transitions: re‐employment rates ................................................................................. 31

2.8 Labour market transitions: longer‐term observations .......................................................................... 34

2.8 Job‐search methods of older workers ................................................................................................... 37

2.9 Summary of main findings from the analysis of labour market trends ................................................. 39

3. Overview of national initiatives to support older workers ......................................................................... 41

3.1 Bulgaria .................................................................................................................................................. 41

3.2 France .................................................................................................................................................... 46

3.3 Germany ................................................................................................................................................ 49

3.4 Netherlands ........................................................................................................................................... 53

3.5 Poland .................................................................................................................................................... 57

3.6 Overview of employment subsidies in favour of older workers around Europe .................................. 60

3.7 Main findings from the case studies on PES experience ....................................................................... 64

4. Conclusion and policy considerations ......................................................................................................... 66

References ....................................................................................................................................................... 71

ANNEX: Supplementary data ........................................................................................................................... 73



Introduction: older workers in Europe and challenges for PES

In Europe older people are less likely to be in work than the overall working age population. In 2010 the

employment rate of people aged 55–64 was 46.3% compared to 64.2% for the working‐age population as a

whole (i.e. those aged 15‐64) or 78.1% for those of prime working‐age (25‐49)1. This figure conceals

significant differences between Member States with the employment rate of those aged 55‐64 varying

from 30.2% in Malta to 70.5% in Sweden. Moreover, the level of employment amongst older workers in the

European Union lags a long way behind that in other major competitor economies ‐ in both the US and

Japan more than six out of ten people aged 55‐64 are still in work2.

The low participation rate of older workers has a number of negative implications for the European

economy in terms of underexploited human resources, a reduced potential for growth, difficulties in

managing the increasingly aged population, and a lack of intergenerational solidarity in sharing the fiscal

burden which leads, ultimately, to higher labour costs. The need for change is evident and clearly identified

in the Europe 2020 strategy, where the adaptation of welfare, flexicurity and life‐long learning systems to

support active ageing and an increase in the employment rate of older workers is explicitly addressed. The

current economic situation and the need for greater efficiency in public expenditure and more sustainable

public budgets make the need for action even more urgent.

The employment rate of older workers in the different EU Member States is strongly related to institutional

and economic factors and, in some cases, cultural and social factors. Active labour market policies (ALMP)

alone will not be sufficient to address the situation and comprehensive approaches are called for. However,

within the flexicurity approach, ALMP have a fundamental role alongside the adaptation of social welfare

systems. In countries where the participation of older workers is particularly low, both labour demand and

supply have to be supported in confronting new constraints imposed by pension reforms and in promoting

new behaviour able to support active ageing strategies.

In this context, public employment services (PES) have an important role to play in helping to address the

situation and keeping senior workers as close as possible to the labour market. On the one hand, the

economic crisis makes it more difficult for older unemployed people to find work and for those that lose

their job and become unemployed, the likelihood of falling into long term unemployment is higher than for

other age groups. On the other hand, maintaining the jobs of older workers requires that they adapt quickly

to changes in technology and evolving models of work organisation. Last, but not least, as the population

ages and the number of workers moving into the senior category increases in years to come there are

important implications for the operational capacity and existing service offer of PES.

Against this background, the study aims to analyse whether the current economic crisis adds pressure to

challenges posed by an ageing workforce and how PES can help to increase the employment participation

rate of older workers. The study is structured as follows:

Chapter 1 provides an overview of the European policy context with special attention to the initiatives of

the European Commission. It provides a strategic framework to the subsequent analysis and establishes the

responsibility of the PES for working with older workers within the broader context.

1 Source: Eurostat, Labour Force Survey: lfsa_ergan 2 Employment rate of people aged 55‐64 is 60.3% in the US and 65.2% in Japan, Source: Eurostat, tsiem020



Chapter 2 examines the current labour market situation of older workers and how the crisis has impacted

on them in relation to other age‐groups and to longer‐term trends. Where relevant, differences such as

gender and educational level are examined. Chapter 2 also considers whether the gross employment rate

figures conceal other trends for older workers to work fewer hours or in atypical forms of employment,

including self‐employment. As older workers tend to experience longer periods of unemployment it also

looks at whether this has been worsened by the economic downturn. Similarly it investigates the problems

older workers experience in returning to work – due to the risks of long‐term unemployment or prolonged

inactivity, examining how long it takes for them to find a job, and the reasons for not seeking work. Finally,

it considers the main reasons why unemployed or inactive older workers left their last job and the methods

used to find a new one.

Chapter 3 provides examples of interventions and employment services implemented in selected EU

Member States (namely Bulgaria, France, Germany, the Netherlands and Poland) to keep older workers in

employment for longer, or to help them find a new job after they have been made redundant. This second

aspect is developed through analysis of national programmes implemented in recent years; a further

section gives an overview of the use of employment subsidies to support older workers.

Chapter 4 identifies the main policy implications emerging from the analysis and the main lessons for the

action of the PES.



1. The European policy context

In the nineties, and especially after the 1993 crisis which saw a widespread use of early retirement

schemes, it became evident that that low levels of labour market participation amongst senior workers

were unsustainable against a backdrop of aging societies in most Member States. Since then, a large

number of reforms limiting or abolishing early retirement schemes, postponing retirement age and

strengthening preventive active labour market policy have been implemented across much of the EU.

The EU Council recognised and highlighted these issues by setting specific targets related to increasing the

labour market participation of older people and progressively raising the average retirement age at EU

level. The 2000 Lisbon European Council established the strategic goal for the EU of more employment,

economic reform and social cohesion in a knowledge based economy and recommended an employment

rate of 50% among older workers. As follow‐up, the 2001 Stockholm European Council established an EU

target for an employment rate of 50% for older women and men (between the ages of 55 and 64) by 2010.

The 2002 Barcelona European Council concluded that there should be a progressive increase of around five

years in the average retirement age by 2010. These initiatives demonstrated a fundamental shift in attitude

among policy makers who previously favoured early retirement as an instrument for ameliorating

unemployment (Taylor, 2008) and were in line with the “radical shift in policy … away from a culture of

early retirement towards comprehensive ageing policies” (COM(2004) 146) called for in the Kok Report

(Kok, 2004).

The European Commission has coordinated and addressed the active ageing process through the European

Employment Strategy (EES). In 2003 the EES, which aimed to create more and better jobs and increase

labour market participation, took on board the recommendations of the preceding European Councils and

stressed the importance of “making work a real option for all”, calling for a comprehensive approach to

active ageing and integrating ALMP with initiatives to retain workers longer in employment. Subsequently,

the 2005‐2008 Employment Guidelines addressed the need to increase the employment rates at both ends

of the age spectrum, to promote a life‐cycle approach that particularly targets younger and older workers,

and to match labour market adaptation to an ageing workforce (COM(2005) 141) (Pillinger, 2008).

The current Europe 2020 Strategy for smart, sustainable and inclusive growth recognises the risks posed by

a labour force that is projected to shrink as a consequence of demographic change and the need to

increase the level of labour market participation, particularly amongst women and both younger and older

people. In particular, Guideline 7 of the Europe 2020 Integrated Guidelines (Increasing labour market

participation of women and men, reducing structural unemployment and promoting job quality) focuses on

the need for policies to increase labour market participation. According to this guideline, flexicurity

principles should be integrated in national policies in order to ensure the right mix of activation and social

protection; in practice, flexible contractual arrangements, ALMP, lifelong learning and adequate social

security systems are needed to support all kinds of transition within the labour market. In this framework

“Member States should review tax and benefit systems, and public services capacity to provide the support

needed, in order to increase labour force participation and stimulate labour demand. They should promote

active ageing, gender equality including equal pay, and the integration in the labour market of young

people, people with disabilities, legal migrants and other vulnerable groups.” This guideline is to be

implemented within the context of the Europe 2020 strategy and the overall target to raise the EU

employment rate for women and men aged 20‐64 to 75% by 2020, with countries setting different national

targets according to their different starting points; in many EU countries this will demand a significant

increase in the participation of older workers. Guideline 8 (Developing a skilled workforce responding to



labour market needs and promoting lifelong learning) provides further elements relevant to an active

ageing strategy by highlighting the need to promote productivity and employability throughout the working

life. To this end it is essential to upgrade skills systematically, in particular for the least well‐equipped

groups within the labour force, and to implement lifelong learning schemes. Furthermore, in the Europe

2020 strategy, the flagship initiative “An Agenda for new skills and jobs” provides further, more

operationally orientated, guidelines for reinforcing policy for older workers. This initiative commits the

European Commission and Member States to update and reinforce the flexicurity strategy, adapt the

legislative framework in line with “smart” regulation principles, promote the recognition of competences,

facilitate labour mobility, and promote partnership and capacity building in different contexts (mainly in

education and employment services); all these elements contribute to a more effective and sustainable

active ageing approach.

In addition, funding for specific interventions in this policy field has been provided. The European

Commission has estimated that within the monies allocated to the European Social Fund (ESF) for the

programming period 2007‐13 around 1 billion euro are being devoted to measures to promoting active

ageing and a longer working life. Older workers, along with other groups, can also benefit from active

labour market measures which account for around 15% of ESF resources (total budget of 75.6 billion euro

for the 2007‐13 period).

More recently, the European Commission designated 2012 as the "European Year for Active Ageing &

intergenerational solidarity" (COM(2010) 462) in order to help create better job opportunities and working

conditions for the growing numbers of older people in Europe.

This brief review of the European policy context for older workers implies two main things: a) the

adaptation of national labour markets to demographic change and the increased participation of older

people will take time and require complex structural reforms; b) this adaptation needs a comprehensive

and multidimensional approach capable of mixing changes in the social security and tax system, contractual

arrangements, health and social assistance, active labour market policy and lifelong learning. Such

developments need to be made in accordance with flexicurity and equal opportunity principles but cannot

be the same or advance at the same speed in all Member States and depend on the current conditions of

each individual labour market.

Fiscal and social security reforms can be used to generate incentives for both employers and employees,

but new cultures of working behaviour and attitudes to work also have to be facilitated and integrated into

practical and day to day practices and implementation. Thus, in all Member States the PES should play a

fundamental role within that policy mix, because they are usually responsible for a large part of ALMP and

for upgrading skills and, even in countries with high participation rate of older people, will have to adjust

policy instruments according to market transformations and implement “preventive” actions to reduce

demand and supply mismatching for this group. Dealing with ageing and ensuring labour market

participation of older workers means that national PES have to adapt their priorities and their operational

approaches.

A clear awareness of the role of PES emerges from some working documents of the PES at European level.

In a document of June 2010 on the future development of the role of PES3, based on a survey organised

through the heads of national PES in the network of EU & EEA PES, demographic change is considered as

one of the principal factors affecting their forward looking strategy making support for the most vulnerable

3 EC, ITEM 2: PES 2020 ‐ mapping visions and directions for future development; June 2010. Unpublished.



groups and inactive people an increasing priority. Abandoning the simple dualism of employed‐

unemployed, broadening the range of target groups and strengthening the preventive approach through a

“lifelong service” approach are general indications that go in this direction. These require an enhanced

networking and partnership approach with all the relevant policy stakeholders, as well as a reform of

employment services in the direction of multi‐channelling and personalised services. In the document, the

development of lifelong learning services, as essential preventative measure, is emphasised and is an

important component of the ageing strategy as previously mentioned. Other documents of the network

echo these considerations; in a document of the PES Working Group 2020 most of the PES consider older

workers as a priority target group; here, lifelong learning initiatives and specific services for increasing the

employability of older workers are highlighted. The reinforcement of career guidance services is also an

important element of the preventative approach relevant to older workers.

There is clearly a need for PES to have adequate financial and human resources in order to cope with the

demands implied by a widening of the client base and the implementation of specialised services; however

in the current period of widespread public budget consolidation and reduced funding of PES it will be a

major challenge to achieve this aim whilst improving efficiency and delivering more for less. As a result, the

overall capacity of the PES to deliver the range of services required to meet the specific needs of older

workers may be limited and co‐operation and partnership with other organisations will be crucial.

In conclusion, among the national PES there is a clear awareness of the potential impact of demographic

ageing and the importance of increasing the labour market participation of older workers. For PES this

implies defining specific strategies for older clients, which include the involvement of employers and other

providers of social or employment services. In future, services for older workers should be addressed as

part of a broad and comprehensive lifelong approach, but at the moment there are still basic steps needed

to develop and refine appropriate services and approaches to meet the specific needs of older workers and

the evidence suggests that current experience of this is limited to relatively few PES.



2. Labour market trends for older workers

The employability of older workers is becoming increasingly important. The population of the EU is ageing

and the ever increasing pressure that this places on pension and welfare systems is being borne by a

shrinking workforce in which older workers have a progressively larger share4. Yet levels of employment

amongst older workers are still a long way behind those in major competitor economies and leaving such a

large productive resource unexploited is economically no longer sustainable.

Working longer is often hailed as the best way to increase retirement incomes at the micro level as well as

to ease the burden of pension expenditure. Yet this strategy depends on the ability of older workers to find

work and/or hold on to their current job. Issues linked to the employability of older people are of particular

relevance in the wake of the recession period that began in 2007/2008, since when the demand for labour

has remained weak and unemployment rates in many EU countries have risen to levels unprecedented in

recent history.

This chapter examines the current situation and main trends for older workers in EU labour markets, how

the crisis impacted on the general trend towards longer working lives and compares the effects of the crisis

on senior workers with other age groups. The data on which the analysis is based are derived primarily

from the EU Labour Force Survey in the 2000‐2010 period and exploit the latest available annual data

referring to 2010 as well as historical data where relevant.

2.1 Europe is characterised by low levels of employment amongst older workers

Employment rates measure the proportion of the population that is in work and vary with age according to

a more or less similar pattern in all countries. Initially, rates for the younger age‐groups are low as

significant proportions of those aged under 25 remain in education. Thereafter, data for 2010 show that

rates for people of prime‐working age (25‐49) rise to a reasonably constant level and then gradually tail off

as people retire from active life (Figure 1). It is also typical that employment rates for women are lower

than those for men throughout the life course.

In relation to older workers, the point of interest is the rate at which the employment rate declines

between prime working age (25‐49) and retirement (taken to be 65+). If Europe is to better exploit the

capacity of its available workforce then more people will have to stay in work up to and beyond the official

retirement age, which means that the employment rates of older workers should remain closer to those of

prime‐age workers than they are today. As shown in Figure 1, the employment rate of those aged 50‐54

throughout the EU (75.2%) is well within the range observed for prime‐age workers (from 72.2% to 80.6%)

but the rate begins to fall dramatically from age 55 onwards. Accordingly, subsequent analysis focuses

mainly on the situation of older workers aged 55‐64 in comparison with those of prime‐age (25‐49) and

does not take into account those aged 50‐54. This has the advantage of accentuating differences but it

must be borne in mind that the shape of the employment‐rate vs. age curve varies between countries so

that in some cases merging the 50‐54 age‐group with the “older” workers might be justified.

4 In 2010, workers aged 55‐64 made up 12.7% of the active population (age 15+) in the EU, up from 9.3% in 2000. Source: Eurostat, Labour Force Survey, lfsa_agan.



Figure 1 – Employment rates by age group and gender, EU 27, 2010 (%)

0

10

20

30

40

50

60

70

80

90

15-1

9

20-2

4

25-2

9

30-3

5

35-3

9

40-4

4

45-4

9

50-5

4

55-5

9

60-6

4

65-6

9

70-7

4

75+

Total

Men

Women

%

Source: Eurostat, Labour Force Survey: lfsa_ergan

In the last ten years there has been a clear trend for people to stay in work longer. The employment rate of

older workers (aged 55‐64) in the EU increased from 36.2% in 19975 to 46.3% in 2010. That is an impressive

10 percentage points in just over a decade but the current level still falls short of the 50% target to be

achieved by 2010, which was established by the Lisbon Strategy for 2010 and the Stockholm Council in

20016. It leaves the EU economy in a position of economic disadvantage in comparison to other major

developed economies such as the US and Japan where, although employment rates amongst prime‐age

workers are similar to those in the EU, a much higher proportion of older people is still in work. The gap

between the employment rates of those aged 25‐54 and those aged 55‐64 is just under 15 percentage

points in the US and Japan but more than double that (over 31 pp) in the EU (Figure 2). The extent of the

gap is particularly pronounced for women ‐ whilst employment rates for women aged 25‐54 in the EU are

actually slightly above those in the US and Japan, those for older workers are significantly lower. Overall,

the low employment rates among older workers in the EU means that the potential labour force is

significantly underexploited, which reduces the potential for growth, and that there are fewer people

contributing to the ever increasing burden of social welfare needed to support an ageing population.

5 First year for which Eurostat data are available for EU‐27.

6 Note that this target is no longer applicable and has been superseded by the over‐arching employment rate target of the Europe 2020 strategy, which aims for 75% of those aged 20‐64 to be in employment by 2020.



Figure 2 – Employment rates by age group and sex, EU‐27, US and Japan, 2010

0

10

20

30

40

50

60

70

80

90

100

EU‐27 US Japan EU‐27 US Japan EU‐27 US Japan

25‐54 55‐64

Total Men Women

%

Source: Eurostat: lfsi_emp_a except for US & Japan 25‐54: OECD

Principal causes of low participation amongst older workers

There are various reasons why the employment rate of older workers is relatively low in most EU countries.

These factors and their intensity may differ between Member States, but the relevant literature generally

concurs on a few key issues.

Firstly, the lack of incentives both for employers to retain or hire older people and for older workers to

remain in the labour force. Existing research has classified the factors that influence the exit of older

workers from the labour market into “push” and “pull” factors (OECD, 2006). From the perspective of

employers, push factors include negative perceptions concerning the capacities of older workers and their

labour costs relative to productivity. From the perspective of individual older workers, they include poor

health and disability, work‐related issues (including unsatisfactory working conditions as well as an age‐

unfriendly work environment), the obsolescence of skills as a consequence of technological change and a

lack of opportunities to update skills (lifelong learning). Pull factors essentially consist of financial incentives

which encourage older workers to retire and factors associated with the attractiveness of retirement

(Taylor, 2002). Financial incentives embedded in pension systems and other welfare benefits play an

important role in work‐retirement decisions and it is essential that older people are not burdened by a

large implicit tax if they choose to continue to work. Therefore, tax/benefit reform could make it more

attractive (in terms of income) for older workers to continue to work rather than becoming inactive and

dependent on benefits. Analysis undertaken by the OECD (Duval, 2003), concludes that a 10 percentage

decrease in implicit taxes would increase the participation of older workers by 3‐4 percentage points.

Secondly, the low employment rate of older workers in Europe is also the result of social factors and, in

particular, the low level of activity amongst women compared to men. There are large cross country

differences within Europe, with Southern European countries persistently behind Nordic and Central

European countries in terms of female participation rates. However, female participation has steadily

increased over the past 30 years, and it has been one of the major drivers of the increased labour market

participation of older workers seen over the last decade or so. Female employment rates in Europe are

increasing as a result of changes in cultural attitudes regarding female participation, higher skill levels and



more opportunity to reconcile work, family and care responsibilities. The increase can also be linked to the

increasing demand for labour in the services sector, where women tend to be concentrated. Furthermore,

female workers aged 45 and over hold a higher proportion of temporary contracts and part‐time

arrangements than their male colleagues. As many of these policies and individual decisions on labour

market participation are likely to persist, further increases in the participation of older women in the labour

market are likely in the future.

Thirdly, employment rates for older workers declined significantly during periods of economic and

structural change in Europe. Until the late 1970s it was rare for people in Western Europe to retire before

the normal retirement age. The economic recessions and consequent rises in unemployment during the

1970s and 1980s led to government measures and industry initiatives to reduce the size of the workforce

by promoting early retirement, particularly in the industrial sector and for men. In fact, in periods of

employment reduction, the common belief was that older workers are associated with higher labour costs

and lower productivity, thereby justifying the phenomenon of “older workers are first to go”. Moreover,

increasing numbers of older redundant workers moved from active benefits to inactive benefits. Many

discouraged workers gave up active job search, and thus unemployment benefits, and became

economically inactive moving onto permanent sickness or incapacity benefits. Similarly, in most Eastern

European countries, the low levels of activity amongst older people have been caused partly by large‐scale

downsizing associated with economic restructuring since the late 1980s‐early 1990s. Labour force

withdrawal was to a large extent encouraged by early retirement benefit schemes introduced by

governments in the hope of boosting unemployment for younger workers (De Serres, 2011).

It is not possible to examine these factors in more detail here, but it is evident that they are rooted in the

structural characteristics of the economy; changing them will take time and requires a radical social and

institutional adaptation in which PES can play an important role.

The demographic context – an ageing workforce

Beside the above mentioned factors, the EU faces tremendous challenges posed by long‐term demographic

changes and their impact on the labour market. Thanks to a combination of social and economic factors

and advances in medical care, the demographics of Europe are characterised by low birth rates and ever

increasing life expectancy and, as a result, the population is ageing. Current projections suggest that the EU

working age population will decrease by around 37 million (or 11%) by 2050 compared to 2010 levels and

that the old‐age dependency ratio will virtually double from its current level of just under 26% to over 50%

in 20507. Moreover, in the coming years older workers will account for a larger share of the working‐age

population than ever before – Eurostat projections suggest that the share will rise from 18% today to 22%

in 2030 and remain over 20% thereafter. But older workers will be more important in some countries than

others (Table 1). At some point over the next 50 years people aged 55‐64 will account for at least a quarter

of the working‐age population in 10 Member States (BG, DE, EE, EL, ES, LV, LT, PL, RO, SK) with a maximum

of 28% in Latvia, whilst in others the peak share will hardly go over 20% (IE, FR, LU, UK).

These trends imply a twofold challenge: a fall in the active population at a time when the number of older

people in need of adequate pensions, other inactivity benefits and long‐term care is rising. In the medium

to long term this is liable to have adverse consequences in terms of labour supply shortages and the

7 Source: Eurostat: http://epp.eurostat.ec.europa.eu/portal/page/portal/population/data/main_tables. The old‐age dependency ratio is the ratio of the number of elderly people at an age when they are generally economically inactive (i.e. aged 65 and over), compared to the number of people of working age (i.e. 15‐64 years old).



sustainability of welfare systems (financing of pension and social benefit systems). As a result it is

increasingly important to encourage older workers to stay in work longer so that they boost the pool of

labour and remain as net contributors to the welfare system.

Table 1 – People aged 55‐64 as a share of the working‐age population (15‐64), 2010‐2060

% 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060

EU 27 18.1 19.3 20.7 21.8 22.0 21.7 21.7 22.0 21.7 20.9 20.4

Belgium 18.5 19.5 20.9 21.1 20.4 19.6 19.5 19.7 19.9 19.5 18.9 Bulgaria 20.0 20.5 21.0 21.5 22.9 25.0 25.7 25.8 24.2 20.3 19.3 Czech Republic 20.0 19.6 18.7 18.7 21.0 24.5 24.5 23.3 23.0 20.5 18.8 Denmark 19.9 19.1 20.1 21.3 21.3 20.2 18.7 18.4 19.8 20.5 20.3

Germany 18.1 20.9 24.2 26.5 24.5 21.5 21.8 23.3 23.5 22.9 22.5 Estonia 17.5 19.3 20.2 19.7 20.0 20.9 22.6 25.2 24.1 19.3 17.7

Ireland 15.0 16.5 17.7 18.0 18.4 19.4 20.6 18.5 15.3 15.8 17.5 Greece 18.1 19.2 20.5 22.3 24.1 25.3 25.5 23.6 21.6 21.0 20.7

Spain 16.0 17.5 19.7 21.5 23.3 25.0 24.7 22.4 20.8 20.4 21.0 France 19.3 19.7 20.2 20.5 20.6 19.7 19.2 19.9 19.7 19.4 19.5

Italy 18.6 19.2 21.3 23.7 24.8 24.3 22.8 21.8 21.8 21.9 22.0 Cyprus 16.1 17.4 18.2 17.5 17.2 18.2 20.5 21.9 22.2 21.5 19.7 Latvia 16.5 18.9 20.9 20.8 21.1 22.1 24.3 28.0 28.0 22.6 19.9 Lithuania 15.5 18.0 21.0 21.8 21.2 20.3 21.1 24.2 25.5 22.8 19.4

Luxembourg 15.9 17.1 18.9 20.3 20.3 20.0 20.3 20.4 20.4 20.4 20.1 Hungary 19.3 20.2 18.4 18.2 20.6 24.0 24.6 23.6 24.0 23.1 22.0

Malta 20.3 20.3 20.3 18.4 17.9 20.1 21.9 23.2 24.1 23.3 21.1 Netherlands 19.4 19.8 21.4 22.7 22.2 20.1 18.9 19.5 20.3 20.5 20.6

Austria 16.7 18.5 21.7 23.7 22.7 20.4 20.2 20.9 21.7 21.9 21.2 Poland 18.1 20.6 19.9 18.1 18.8 21.8 25.3 26.9 26.0 23.4 20.7

Portugal 17.8 18.9 20.3 21.3 22.6 24.3 24.4 22.9 21.9 22.1 23.0 Romania 16.9 18.8 17.6 19.2 22.3 24.1 25.3 27.1 26.1 22.9 22.4

Slovenia 18.4 20.8 21.5 22.0 22.1 23.3 24.7 24.7 23.1 20.8 19.6 Slovakia 16.8 18.9 19.1 18.6 19.9 23.3 25.5 26.1 25.7 23.4 21.1

Finland 22.1 21.5 21.3 21.0 19.4 19.1 20.3 20.5 20.8 20.4 19.4 Sweden 19.7 18.6 19.1 20.1 20.2 19.2 18.7 19.8 21.3 19.8 18.0

United Kingdom 17.8 17.7 19.4 20.5 19.7 17.8 17.8 19.1 19.6 19.0 17.9

Source: Eurostat population projections: proj_10c2150p

Employment rate differences between countries

The overall EU employment rate for people aged 55‐64 in 2010 (46.3%) masks considerable differences

between countries (Figure 3). On the one hand, Sweden stands out with a rate of 70.5%, some 12

percentage points ahead of any other country. There is then a group of five countries (DE, DK, UK, CY and

FI) with rates between 56 and 58% which, although high in the European context, are still some way behind

those reported in the US and Japan. Estonia, the Netherlands and Ireland – just – complete a group of nine

countries that have met the Stockholm target of 50% in 20108, though it should be noted that this target is

no longer applicable and has been superseded by the overall Europe 2020 target of 75% for those aged 20‐

64. On the other hand, employment rates of older workers were below 40% in the three French speaking

continental Member States (FR, LU, BE) and in Italy, and 35% or less in Slovenia, Hungary, Poland and

Malta. In some cases, low rates are at least in part linked to lower retirement ages, something that many

Member States are now taking steps to address.

8 In 2009, Lithuania and Latvia also met the 50% target for the employment rate of older workers but the ongoing impact of the recession saw rates in these countries fall to 48.6% and 48.2% respectively in 2010.



Figure 3 ‐ Employment rates of people aged 55‐64, EU‐27, 2010 (%)

30.2

46.3

70.5

0 10 20 30 40 50 60 70 80

MTPLHUSIITBELUFRSKROELATBGES

EU 27CZLVLTPTIENLEEFICYUKDKDESE


In general, low employment rates for older workers are associated with low rates for prime‐age workers

though there are exceptions, which relate to unusually high (or low) differences between the employment

rates of the two groups. For example, Slovenia has one of the highest employment rates for prime‐age

workers (85%) but one of the lowest for older workers (35%) – a gap of 50 percentage points, the highest in

the EU (Figure 4). By contrast, Ireland has the second lowest rate for prime‐age workers (70.6%) but an

above average employment rate for older workers (50%) so that the employment rate gap is just 20.6

percentage points, the second lowest in the EU. This particular case is a direct result of the recession as the

employment rate of prime‐age workers in Ireland fell by nearly 9 percentage points between 2007 and

2010 whilst the rate for older workers fell by less than 4 pp over the same period.

Across the EU, the employment rate gap between older and prime‐age workers is just under 32 percentage

points. Reducing this gap by raising the level of employment amongst older workers could contribute

significantly to the Europe 2020 target of having 75% of people aged 20‐64 in employment by 2020. Over

the past decade the gap has been reduced significantly in countries such as Germany and Slovakia where it

has fallen over 18 percentage points (Table 2) but it has actually increased in Poland (1.1 pp), Malta (6.5 pp)

and Romania (6.8 pp).

The variation between countries reflects social and economic differences including, to some extent,

different retirement ages, but also the extent to which welfare and pension systems have been reformed

over the past decade as well as efforts to reduce access to early retirement schemes, strengthen incentives

to work longer and improve the employability of older workers (COM(2009) 58). It demonstrates clearly

which countries need to take action to tackle the issue of low levels of activity amongst older workers and

to what extent.



Figure 4 ‐ Employment rate gap between prime‐age (25‐49) and older workers (55‐64) in the EU, 2010

14.4

31.8

50.0

0 10 20 30 40 50 60

SEIEEEUKDEFILTLVDKESCYPT

EU 27NLELBGITROCZSKHUMTFRATBELUPLSI


Table 2 ‐ Employment rate gap between prime‐age (25‐49) and older workers (55‐64), 2000‐2010

Gap (percentage points) 2000 2005 2010 Change 2000‐2010 EU27 40.3 35.8 31.8 ‐8.5 Belgium 56.0 48.3 43.9 ‐12.1Bulgaria 48.4 39.0 32.7 ‐15.7Czech Republic 45.7 37.4 35.3 ‐10.4 Denmark 30.5 25.3 25.8 ‐4.7 Germany 42.8 33.3 24.0 ‐18.8 Estonia 34.1 23.9 21.2 ‐12.9 Ireland 32.0 27.5 20.6 ‐11.4Greece 32.8 33.9 32.3 ‐0.5Spain 33.1 32.6 26.6 ‐6.5 France 49.6 42.7 42.3 ‐7.3 Italy 42.1 41.8 34.7 ‐7.4 Cyprus 29.6 32.3 26.8 ‐2.8 Latvia 38.6 29.6 25.8 ‐12.8Lithuania 34.9 32.7 25.6 ‐9.3Luxembourg 52.9 50.4 44.2 ‐8.7Hungary 52.1 41.9 38.7 ‐13.4 Malta 34.5 33.9 41.0 6.5 Netherlands 45.7 37.9 31.8 ‐13.9 Austria 53.9 51.9 42.6 ‐11.3Poland 43.8 45.2 44.9 1.1Portugal 32.1 31.4 30.8 ‐1.3 Romania 27.9 35.5 34.7 6.8 Slovenia 63.3 55.6 50.0 ‐13.3 Slovakia 53.6 45.2 35.5 ‐18.1 Finland 40.2 29.4 25.4 ‐14.8Sweden 17.9 14.5 14.4 ‐3.5UK 30.6 24.8 22.9 ‐7.7




The gender gap

The employment rates of women are generally below those of men for all age‐groups (Figure 1) and the

extent of the gender gap strongly influences the overall employment rate in each group. In general the gap

is low for younger workers, increases through the main child‐bearing years as women take career breaks,

reduces slightly through to the 45‐49 age‐group as children grow up and need less full‐time care and then

increases again. In 2010, the gender gap was 12.5 percentage points for prime‐age workers (25‐49) but 16

pp for older workers (55‐64).

The absolute size of the gender gap is likely to be at least partly related to the overall level of the

employment rate, and one way to eliminate this factor is to look at the ratio of the rates for each gender.

Expressing the employment rate for women as a proportion of that for men generates a form of

segregation index showing the scale of the difference between the sexes. The higher the value of the index

the closer the female rate is to the male rate, the lower the value the greater the gender gap. For the EU as

a whole the segregation index is 71% for older workers compared to 85% for prime‐age workers (Figure 5) –

in other words the gender gap is greater for older workers. This pattern is common to most Member States

with the index in 2010 lower for older workers in all countries except Estonia, France, Latvia and Finland.

The segregation of older workers is particularly pronounced (i.e. low values of the index) in Mediterranean

countries and in some eastern European countries (Poland, Slovakia, Slovenia, Czech Republic).

Figure 5 ‐ Employment rate segregation index (Female/male employment rate) by age group, 2010

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

EU27 BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK

25‐49 55‐64


Over the past decade the gender gap has reduced significantly (Figure 6) but it is noticeable that there is a

distinct cut‐off point at age 60‐64 and above, where there has been virtually no change in the gap. It is

possible that this is partly a cohort effect, as women currently aged 60 or over belong to a generation when

(relatively) fewer women worked, and that the positive reduction in the gender gap will feed through to

that age‐group as the younger women who are working now move through the age brackets, though this

will of course depend on there being the right opportunities and environment for them to do so.



Figure 6 – The gender gap in employment rates by age group, EU 27, 2000 and 2010

0

5

10

15

20

25

15 ‐ 19 20 ‐ 24 25 ‐ 29 30 ‐ 34 35 ‐ 39 40 ‐ 44 45 ‐ 49 50 ‐ 54 55 ‐ 59 60 ‐ 64 65 ‐ 69 70 ‐ 74

2000 2010

Employment rate gap (percentage points)


The unexploited potential of older workers

The evidence of current employment rates amongst older workers show that Europe is lagging behind

other advanced economies (US and Japan) in exploiting their potential labour resources particularly when it

comes to elderly workers. Bearing in mind the Europe 2020 target to get 75% of those aged 20‐64 in

employment by 2020, just how much could boosting the employment of older workers contribute to that

target? The current employment rate gap between prime‐age (25‐49) and older workers (55‐64) is over 30

percentage points. A simple simulation shows that reducing that gap by 5 points would result in a 1 point

rise in the overall rate for those aged 20‐64. Therefore, raising the employment rate of older workers by 20

percentage points, which would bring it up to a similar level to that in Japan, would add 4 points to the

overall rate and bring it from the current level of 68.6% to 72.6% and much closer to the 2020 target.

Obviously increasing the share or older workers in employment by 20 percentage points is not a realistic

short‐term target but it serves to demonstrate the potential that exists.



Figure 7 ‐ Potential impact on the overall employment rate (20‐64) of an increased employment rate for

older workers (55‐64), EU 27

68.6%

46.3%51.3%

69.6%66.3%

72.6%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Older workers (55‐64) Overall employment rate (20‐64)

Current (2010) rate Plus 5% for 55‐64 Plus 20% for 55‐64

Source: Own elaboration of Eurostat data

2.2 Recent trends and the impact of the crisis

In recent years one of the most prominent developments in the EU labour market has been the sharp rise

in the numbers of older workers in employment. Between 2000‐2008, a period that includes several years

of strong growth, the number of people in work in the EU increased by nearly 19.5 million (Table 3) and 7.6

million of these – nearly 40% of the total ‐ were people aged between 55 and 64, who accounted for less

than 10% of total employment at the start of the period. Indeed, the number of people of this age group in

employment increased by nearly 40% over the period compared to a rise of just 6% for prime‐age workers

(25‐49) and a marginal decline for younger workers (15‐24). It is interesting to note that although women

accounted for 70% of the increase amongst prime‐age workers, there was a 50:50 split amongst older

workers. However, as there were fewer women than men employed in both age groups at the start of the

period, the percentage changes in both cases show that the rate of increase was higher for women than

men – nearly 10% compared to 3% for prime‐age workers and 52% compared to 32% for older workers.

Table 3 ‐ Changes in employment by age and gender, EU27, 2000‐2008 and 2008‐2010

Absolute numbers (1000s)

Total Men Women

2000‐2008 2008‐2010 2000‐2008 2008‐2010 2000‐2008 2008‐2010

15‐24 ‐47.7 ‐2,574.6 28.6 ‐1,541.9 ‐76.2 ‐1,032.725‐49 8,276.3 ‐4,609.6 2,504.6 ‐3,083.9 5,771.7 ‐1,525.755‐64 7,615.4 1,393.4 3,805.9 433.3 3,809.4 960.2Total 19,445.2 ‐5,314.7 7,664.7 ‐4,141.2 11,780.5 ‐1,173.6

Percentage change

Total Men Women

2000‐2008 2008‐2010 2000‐2008 2008‐2010 2000‐2008 2008‐2010

15‐24 ‐0.2% ‐11.4% 0.2% ‐12.5% ‐0.7% ‐10.1%25‐49 6.1% ‐3.2% 3.3% ‐3.9% 9.8% ‐2.4%55‐64 39.6% 5.2% 32.1% 2.8% 51.6% 8.6%Total 9.8% ‐2.4% 6.8% ‐3.5% 13.7% ‐1.2%

Source: Eurostat, Labour Force Survey: lfsa_egan



Then, over the following two years as the impact of the financial crisis hit labour markets across Europe, 5.3

million jobs were lost. However, these losses were concentrated amongst prime‐age and younger workers

and employment continued to rise amongst the older age‐groups with the number of people aged 55‐64 in

work in 2010 up 1.4 million or 5.2% from the 2008 level.

As striking as these figures may be, changes over time in the absolute numbers of people employed can ‐

particularly over longer periods – sometimes be a little misleading as they do not take into account

underlying demographic changes which dictate the size of the potential labour pool in each age‐group.

Employment rates relate the numbers in work to the population and therefore avoid this problem and, in

fact, the figures just serve to emphasise the message above. From 2000 to 2008 employment rates

increased generally but clearly increased more with age and more so for women than men (Figure 8). Over

the crisis period employment rates fell generally but more so for the younger age groups and the only

increases were amongst older workers (Figure 9). Again, women did better, or were less badly affected,

than men. This is partly a continuation of the longer term trend of increasing participation of women, but

also a reflection of the sectoral distribution of job‐losses during the crisis which particularly affected male

dominated sectors such as construction and manufacturing. Austerity measures that are now imposing cut‐

backs in public services including areas such as health, social services and education, which employ large

numbers of women might impact on this trend in the future.

Figure 8 ‐ Change in employment rates by age‐group, EU‐27, 2000‐2008

‐6

‐4

‐2

0

2

4

6

8

10

12

15‐19 20‐24 25‐29 30‐35 35‐39 40‐44 45‐49 50‐54 55‐59 60‐64

Total Men Women

Percentage point change




Figure 9 ‐ Change in employment rates by age‐group, EU‐27, 2008‐2010

‐6

‐4

‐2

0

2

4

6

8

10

12

15‐19 20‐24 25‐29 30‐35 35‐39 40‐44 45‐49 50‐54 55‐59 60‐64

Total Men Women

Percentage point change


The trends seen at EU level are more or less mirrored at national level, though there are some exceptions

(Table 4). In the 2000‐2008 period employment rates rose everywhere except Romania and Portugal and

older workers were the best performing group in 21 Member States (all except Denmark, Greece, Cyprus,

Malta, Poland and Romania). In the post‐crisis period (2008‐2010) employment rates fell overall in most

countries, and in some cases significantly so (e.g. Estonia, Ireland and Latvia), but changes for older workers

were positive in the majority of the countries (16 vs. 11). Moreover, irrespective of whether changes were

up or down, older workers did better than prime‐age or younger workers in all but three Member States

(Latvia, Malta and Romania).

The evidence of employment numbers and rates clearly indicate that the economic downturn impacted less

on older workers in the EU than on prime‐age workers or rather, on younger workers. This concurs with

other international evidence (e.g. OECD, 2011) and findings that older workers were less likely than

younger ones to lose their jobs as a result of the recent crisis (Johnson and Mommaerts, 2011). It is,

however, in contrast to the previous recession, when older workers were often the first to lose their jobs

and found it hardest to find new employment (OECD, 2011). In fact, in many European countries, previous

recessions saw sharp declines in the numbers of older men in employment. Traditional occupations and

industries suffered most as policies encouraging early retirement were widely used (Baron, 2009).

However, the situation today is rather different. Early retirement schemes are largely inconsistent with key

political objectives to increase employment amongst older workers and generally, where they still exist,

governments are taking steps to reduce access to such schemes. There are, of course, some differences

between countries but, overall, older workers in Europe appear to have fared relatively well through the

crisis period.



Table 4 ‐ Changes in employment rates by age‐group, 2000‐2008 and 2008‐2010

2000‐2008 2008‐2010 15‐24 25‐49 55‐64 Best performing group 15‐24 25‐49 55‐64 Best performing group

EU‐27 0.5 3.3 8.8 Older ‐3.4 ‐2.3 0.7 Older BE ‐2.9 1.3 9.5 Older ‐2.2 ‐1.1 2.8 Older BG 5.8 11.5 23.9 Older ‐4.1 ‐5.8 ‐2.5 OlderCZ ‐8.3 1.6 11.5 Older ‐2.9 ‐1.6 ‐1.1 OlderDK ‐0.2 3 2.7 Prime‐age ‐8.8 ‐4.7 0.3 Older DE 0.8 2.1 16.4 Older ‐0.7 ‐0.6 3.9 Older EE 9.3 7 19.1 Older ‐10.7 ‐9.4 ‐8.6 Older IE ‐2.2 1 8.6 Older ‐15.4 ‐7.5 ‐3.7 Older EL ‐3.9 5.4 3.4 Prime‐age ‐3.1 ‐3 ‐0.5 OlderES 3.8 6.5 8.8 Older ‐11.1 ‐6.2 ‐2 OlderFR 3.7 4.6 8.8 Older ‐1.1 ‐1.6 1.5 Older IT ‐1.7 4.5 7.1 Older ‐3.9 ‐2.6 2.2 Older CY 1.3 5.5 5.3 Prime‐age ‐4.2 ‐1 2 Older LV 6.9 9 24 Older ‐10.8 ‐9 ‐11.2 Prime‐age LT 0 6 11.9 Older ‐7.5 ‐7.9 ‐4.5 OlderLU ‐8 0.8 6.9 Older ‐2.6 2.9 5.5 OlderHU ‐13.1 1.4 9.5 Older ‐1.7 ‐2.3 3 Older MT ‐6.5 6.5 0.6 Prime‐age ‐1.1 1.6 1 Prime‐age NL 0.9 4.1 15.1 Older ‐6.3 ‐2.2 0.7 Older AT 3.4 2.2 11.8 Older ‐2.3 ‐0.3 1.4 Older PL 3.2 7.1 2.6 Prime‐age ‐1 ‐1 2.4 OlderPT ‐6.4 ‐0.6 ‐0.5 Older ‐6.2 ‐2.8 ‐1.6 OlderRO ‐9.2 ‐4 ‐8.9 Prime‐age ‐0.5 ‐0.1 ‐2 Prime‐age SI 7.2 3 10.5 Older ‐4.3 ‐3.6 2.2 Older SK ‐2.1 5.4 17.7 Older ‐5.6 ‐4.5 1.3 Older FI ‐0.7 3.1 15.3 Older ‐5.9 ‐2.9 ‐0.3 Older SE 5.3 4.5 5.8 Older ‐3.5 ‐1.8 0.4 OlderUK ‐3.4 0.6 7.6 Older ‐4.8 ‐1.6 ‐0.9 Older


2.3 The working situation of older workers

This section aims to investigate briefly some of the possible reasons why older workers have been less

affected by the recent economic crisis, and whether the gross employment rate figures might conceal other

trends for older workers in relation to working hours or atypical forms of employment.

Working hours

Many older workers, particularly those with a long working life, would welcome the opportunity to

gradually reduce their hours rather than retire completely. This strategy can help to keep people in work

longer and there are policy measures in a number of countries to support this transition (see Abraham and

Houseman, 2004). Indeed, Figure 10 shows that there is a clear tendency for people to work fewer hours as

they near retirement. In 2010, only 14% of the people aged 25‐49 worked less than 30 hours per week and

the proportion is similar for the 50‐54 age‐group, but there is a clear increase to nearly 17% for people

aged 55‐59 and to more than 25% for those in the 60‐64 age group.



Figure 10 ‐ Share of people in employment working less than 30 hours/week by age group, EU 27, 2010

25.3%

13.2% 13.6% 13.5% 13.4% 13.3% 13.7%13.9%

14.1% 14.1% 13.8% 13.8% 13.9% 14.2% 14.5%

17.7% 17.5% 17.4%17.0% 16.9% 16.9%

16.8%

24.9% 25.1% 24.8% 25.4%25.0% 24.9%

10%

15%

20%

25%

30%

2004 2005 2006 2007 2008 2009 2010

25‐49 50‐54 55‐59 60‐64

Source: Own elaboration of EU LFS data

What is also clear, however, is that there is no evidence that these shares are changing significantly and

certainly nothing in this particular dataset to suggest that working less has been a factor in helping older

workers keep their jobs through the crisis period. Eurostat data indicate that the total number of hours

worked per person fell between 2008 and 2010 but it is quite likely that this largely reflects cuts in overtime

hours for full‐time workers rather than a significant shift from full‐time to part‐time hours. Amongst prime‐

age workers and those aged 50‐54 there is a hint that the proportion working less than 30 hours increased

through the crisis period but the change is so small – just half a percentage point – that it is difficult to

attribute any major significance to this and the change in the older workers group is even smaller.

Self‐employment

Older workers are more likely to be self‐employed than prime‐age and younger workers. In 2010 more than

one in five (21.6%) older workers in employment were self‐employed (with or without employees)

compared to one in seven prime‐age workers (Table 5). In recessions, redundancy – either a perceived

threat of it or the reality of it – may motivate people to start their own businesses and the capacity to make

this type of transition may have made older workers more resilient to the impact of the crisis. However, the

data show that there has been little change in the incidence of self‐employment amongst either prime‐age

or older workers. In fact, over a longer period, since 2004, the proportion of older workers who are self‐

employed has fallen slightly from 24.4% to 21.6% but most of this decline occurred before the crisis.



Table 5 – Distribution of people in employment by professional status and age group, EU 27 (%)

25‐49 2004 2005 2006 2007 2008 2009 2010

Employee 84.1 84.3 84.4 84.5 84.7 84.8 84.7

Family worker 1.6 1.5 1.4 1.3 1.2 1.2 1.2

Self‐employed with employees 4.5 4.4 4.4 4.5 4.4 4.4 4.2

Self‐employed without employees 9.8 9.8 9.8 9.7 9.7 9.6 9.9

55‐64 2004 2005 2006 2007 2008 2009 2010

Employee 72.4 73.5 74.6 75.3 76.1 76.2 76.4

Family worker 3.2 2.9 2.5 2.5 2.2 2.1 1.9

Self‐employed with employees 7.6 7.1 6.8 6.9 6.7 6.9 6.5

Self‐employed without employees 16.8 16.5 16.0 15.2 15.0 14.9 15.1


Temporary work

Hiring and firing regulations and stability of job tenure are further factors that may contribute to

differences between age‐groups in terms of losing or keeping a job during a recession. As a result of longer

service, many older workers enjoy stronger employment protection than younger workers. This can be

particularly significant in countries where the level of protection offered with open‐ended and fixed‐term

contracts varies greatly and when younger workers are most likely to be employed on temporary contracts.

In times of recession, when employers are under pressure to cut jobs usually employees hired under

temporary (fixed‐term) contracts ‐ often young people and women – are the first to go, simply because

such contracts are easier and cheaper to terminate.

Older workers are less likely than average to be employed on a temporary contract – around 7% of

employees aged 55‐64 work on the basis of a fixed‐term contract compared to 12% of prime‐age workers

(Table 6; figures by country can also be found in Table A.1 in annex). In both cases, women are more likely

than men to be engaged on a temporary contract. Interestingly, however, the proportion of older

employees on temporary contracts has hardly changed over recent years, including the crisis period, which

suggests that the job‐losses that occurred as a result of the recession impacted equally on people with

fixed‐term and open‐ended contracts. This was not the case for prime‐age workers where there is evidence

in a decline in the share of temporary contracts over the crisis period as these people were among the first

to be dismissed. It is possible, therefore, that the relatively low incidence of temporary work amongst older

workers therefore helped to isolate them from some of the highest risks of job‐loss.

Table 6 ‐ Share of employees working on a temporary contract, EU‐27, 2004‐2010 (%)

2004 2005 2006 2007 2008 2009 2010

Males 25‐49 10.1 11.1 11.6 11.5 11.1 10.6 11.2

Females 25‐49 12.0 12.6 13.2 13.4 13.2 12.8 13.0

Males 55‐64 5.9 6.4 6.6 6.6 6.5 6.4 6.7

Females 55‐64 6.8 6.8 7.2 7.3 7.3 7.3 7.1

Source: Eurostat, Labour Force Survey: lfsa_etgaed & lfsa_egaps

2.4 Unemployment among older workers and the effect of the crisis

In terms of employment, there is a long‐term trend for people to stay in work longer and the evidence

reviewed above shows that economic downturn has impacted less on older workers than on other age

groups. Nevertheless, once older workers lose their job they encounter major difficulties in finding a new

one. Older workers are more likely to have longer spells of unemployment with the result that many



become discouraged from seeking work and slip into inactivity, which is often a path of no return with few

chances of re‐entering the world of work.

Overall, older workers are less likely to be unemployed than prime‐age workers. In 2010, the EU

unemployment rate for people aged 55‐64 was 6.9% compared to 8.9% for those aged 25‐49 (and 20.9%

for those aged 15‐24). Rates for older workers are lower than those for prime‐age workers in 21 of the 25

countries for which the breakdown is available and just a little higher in five countries – Bulgaria, the Czech

Republic, Germany, Estonia and the Netherlands (Figure 11).

Increases in unemployment as a result of the recession also affected prime‐age workers slightly more than

older workers. The unemployment rate of older workers increased by 1.8 percentage points between 2008

and 2010 compared to 2.6 pp for prime‐age workers (and 5.4 pp for younger workers). Again, this pattern is

reflected in the vast majority of Member States with larger increases for older workers only in the Czech

Republic and France and in both cases the difference was marginal (0.2 pp).

Figure 11 ‐ Unemployment rates by age‐group, 2010

0

2

4

6

8

10

12

14

16

18

20

EU27 BE

BG CZ

DK

DE EE IE EL ES FR IT CY LV LT LU HU

MT

NL

AT

PL

PT

RO SI SK FI SE UK

25‐49 55‐64

% labour force

Source: Eurostat, Labour Force Survey: lfsa_urgan. Data not available for older workers in LU & MT.

Figure 12 ‐ Changes in the unemployment rate by age‐group, 2008‐2010

‐2

0

2

4

6

8

10

12

14

EU27 BE

BG CZ

DK

DE EE IE EL ES FR IT CY LV LT LU HU

MT

NL

AT

PL

PT

RO SI SK FI SE UK

25‐49 55‐64

Percentage points

Source: Eurostat, Labour Force Survey: lfsa_urgan. Data not available for older workers in LU & MT.

So, in general, older workers are less likely to be unemployed than other age‐groups and were not

particularly adversely affected by the crisis. The problem is that once displaced, older workers tend to stay

unemployed longer than their younger counterparts. In 2010, over half (54‐56%) of the unemployed aged

55‐64 had been out of work for 12 months or more compared to 41% of those aged 25‐49 (Figure 13) and

there is little difference between men and women. Amongst the older unemployed (55‐64) more than 30%

had been seeking work for at least 2 years and 17‐18% for more than 4 years. These figures compare to less



than 20% and 8% respectively for prime‐age unemployed. The figures clearly show that the duration of

unemployment spells increases with age. In other words for people who become unemployed, the older

you are the longer it is likely to take to find a new job.

This pattern is repeated in all EU Member States except the Czech Republic and Estonia where long‐term

unemployment (12+ months) is slightly more prevalent among prime‐age workers (Figure 14). In terms of

the relative incidence of long‐term unemployment, the difference between old and prime‐age workers is

particularly pronounced in some countries. For example, in Belgium 80% of older unemployed have been

out of work for a year compared to 50% of prime‐age unemployed and in Austria, although the levels of

long‐term unemployment are lower, the difference between the share of older and prime‐age unemployed

who are LTU is still over 30 percentage points (56% vs. 24%). Although Belgium has the highest level of

long‐term unemployment amongst older workers, levels are also considerably above average in Portugal

and Slovakia, though in the latter case long‐term unemployment is high generally and not particularly

concentrated amongst older workers.

Figure 13 ‐ Distribution of the unemployed by duration of job‐search and age‐group, EU‐27, 2010

39.1%

31.4%

27.8%

26.9%

20.1%

18.6%

18.4%

17.6%

21.7%

22.3%

22.7%

22.9%

11.0%

13.4%

14.6%

14.4%

8.1%

14.3%

16.5%

18.3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

25‐49

50‐54

55‐59

60‐64

< 6 month 6‐11 months 12‐17 months 24‐47 months 4 years or longer


Figure 14 ‐ Long‐term unemployed as a share of total unemployed by age‐group, 2010

0

10

20

30

40

50

60

70

80

90

EU‐27

BE

BG CZ

DK

DE EE IE EL ES FR IT CY

LV LT LU HU

MT

NL

AT PL

PT

RO SI SK FI SE UK

25‐49 55‐64

%

Source: Eurostat, Labour Force Survey: lfsa_upgal. Data not available for older workers in LU & MT.

Typically, in a recession the proportion of long‐term unemployed falls as there is a large influx of short‐term

unemployed. The last recession was no exception with the proportion of unemployed who had been out of

work for a year of more falling across the EU in 2008 and 2009 but then starting to rise again as those who

lost their jobs earlier in the recession failed to find work again and the duration of unemployment spells

lengthened (Figure 15). The trend for older and prime‐age unemployed over the period 2000‐2010 is more



or less the same. The gap between the two (i.e. the difference in the proportions of each group who where

long‐term unemployed) widened somewhat towards the end of the growth period (from around 13

percentage points to 19), indicating that even in the most buoyant of labour markets older workers still

have the greatest difficulties to find work. But since the onset of the recession the gap has narrowed again

and returned to the previous level.

Figure 15 ‐ Long‐term unemployed as a share of total unemployed by age‐group, EU‐27, 2000‐2010

0

10

20

30

40

50

60

70

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

25‐49

55‐64

%

Source: Eurostat, Labour Force Survey: lfsa_upgal

Across the EU, the long‐term unemployment rate (i.e. the number of long‐term unemployed people as a

share of the labour force) for older workers (3.7%) is very similar to that for prime‐age workers (3.6%) and

the same is true in most Member States (Figure 16). Moreover, recent changes in the level of long‐term

unemployment as the impact of the crisis filters through do not appear to have particularly affected older

workers – changes are similar for prime‐age workers and, if anything, slightly lower – particularly in the

most affected countries (Figure 17). The data clearly shows how the rate of long‐term unemployment has

risen dramatically in the countries that were hit earliest and hardest by the recession – Estonia, Ireland,

Spain, Latvia and Lithuania. It is likely that further delayed increases will be seen in more countries as data

on the longer term impact of widespread job‐losses become available.

Figure 16 ‐ Long‐term unemployment rates in the EU by age‐group, 2010

0.01.0

2.03.0

4.05.0

6.07.0

8.09.0

EU27

BE

BG CZ

DK

DE EE IE EL ES FR IT CY

LV LT LU HU

MT

NL

AT PL

PT

RO SI SK FI SE UK

25‐49 55‐64

% labour force

Source: Own elaboration of EU LFS data. Data not available for older workers in LU & MT.



Figure 17 ‐ Changes in long‐term unemployment rates in the EU by age‐group, 2008‐2010

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

EU

27

BE

BG

CZ

DK

DE

EE IE EL

ES

FR IT CY

LV

LT

LU

HU

MT

NL

AT

PL

PT

RO SI

SK FI

SE

UK

25-49 55-64

Percentage points

Source: Own elaboration of EU LFS data. Data not available for older workers in LU & MT.

2.5 Labour market transitions: the drift into inactivity

Mobilising the potential labour supply of inactive people is the key to achieving the employment rate

targets set by the EU and has a major role in attenuating the negative impact of population ageing on the

labour market (Employment in Europe 2007). Although encouraging people to stay in work longer will

reduce inactivity amongst the older age‐groups, this is only part of the story. It is also necessary to target

those who have already become inactive and encourage them to return to work. The question is how to do

this effectively. Public employment services tend to work mainly with people that are unemployed or

otherwise actively seeking work but the analysis below shows that older workers who become unemployed

are likely to drift into inactivity and stop seeking new employment. Once outside the labour market, little

assistance is available so more needs to be done to tackle the specific needs of older workers, help them

adapt to new ways of working and eliminate the barriers that discourage them from continuing to seek

work.

The proportion of people who move from being active (employed or unemployed) in one year to inactive in

the next is higher for the 55‐64 age‐group than the 25‐49 age‐group (Figure 18). Around one in thirteen

(7.6%) older workers who were employed in 2009 were inactive in 2010 compared to more like one in fifty

prime‐age workers. But what is really striking is that for people who were unemployed in 2009, nearly half

of those aged 55‐64 were inactive in 2010 compared to just over one in five of those aged 25‐49. For both

age‐groups, though more so for the older workers, the proportion of unemployed drifting into inactivity

increased steadily between 2004 and 2008/9 but fell back slightly in 2010.

Figure 18 ‐ Drift into inactivity by age‐group, EU 27, 2004‐2010 (%)

1.8% 1.7% 1.8% 1.8% 1.8% 2.1% 2.2%

7.6%8.0% 7.5% 7.6% 7.4% 7.4% 7.9%

0%

10%

20%

30%

40%

50%

2004 2005 2006 2007 2008 2009 2010

Employed 25‐49 Employed 55‐64

Proportion of people employed in the previous year and now inactive

22.8%

46.0%

19.7% 21.6% 21.9% 23.1%24.8% 25.0%

40.8%41.9%

47.6% 48.1% 49.5% 49.6%

0%

10%

20%

30%

40%

50%

2004 2005 2006 2007 2008 2009 2010

Unemployed 25‐49 Unemployed 55‐64

Proportion of people unemployed in the previous year and now inactive




There are important differences between men and women, in all cases the latter are more likely than the

former to be inactive after having been active in the previous year (Figure 19). There are a number of

factors that may be behind this. Firstly, women are more likely than men of the same age to be working in

part‐time, temporary and low‐wage jobs so that there are fewer incentives to remain in the labour market.

Secondly, women more often than men take on caring and family responsibilities and this can be a source

of saving for the whole family, especially compared to low wage employment. Thirdly, in some countries

the official retirement age still favours women, though the differences are gradually being eroded.

The proportion of people drifting into inactivity also differs according to their level of education (Annex ‐

Figure A.1). As might be expected, people aged 55‐64 with low levels of education are most likely to drift

into inactivity – generally they are employed in the hardest and lowest paid jobs and hence have less

incentive to stay. Prime‐age workers with high levels of education are least likely to become inactive.

Figure 19 ‐ Drift into inactivity by age‐group and sex, EU 27, 2004‐2010 (%)

1.3%

6.9%

8.5%

1.0% 1.4%

2.8% 3.2%

7.2%6.4%

7.1%

9.3% 9.1%

0%

2%

4%

6%

8%

10%

2004 2005 2006 2007 2008 2009 2010

Men 25‐49 Women 25‐49 Men 55‐64 Women 55‐64

Proportion of people employed in the previous year and now inactive

27.3%

42.7%

50.5%

15.8%21.0% 18.8%

23.6%29.0%

38.5%

46.3%

44.6%

54.5%

0%

10%

20%

30%

40%

50%

60%

2004 2005 2006 2007 2008 2009 2010


Proportion of people unemployed in the previous year and now inactive


The problem with older people drifting into inactivity is that once in that situation there is a risk that they

do not even attempt to return to an active life. The population considered as inactive includes some people

who are still actively seeking work but who do not qualify as unemployed because they are not

immediately available for work (e.g. because of caring responsibilities, illness, training, etc.) but the

numbers of these are small – just under 5% of those aged 25‐49 but less than 1% of those aged 55‐64

(Figure 20). However, there are also people who would like to work but who are not currently seeking

work. Such people account for more than one in four of prime‐age inactivity which, when added to those

already seeking work, makes a total of a third who would like to work. By contrast, amongst older people

less than one in ten is interested in working again ‐ 92% say that they do not want to work. These are EU

level figures, data by country are unfortunately not usable due to the high number of missing values in the

breakdown (small sample size). Within the prime‐age group, a higher proportion of men than women is

interested in returning to work (42.2% vs. 30.3%) but amongst older workers there is little difference

between the sexes (9.9% of men compared to 7% of women).



Figure 20 ‐ Willingness to work amongst inactive persons by sex and age‐group, 2010

66.5%

91.8%

57.7%

90.1%

69.6%

93.0%

28.6%

7.4%

34.9%

8.8%

26.3%

6.4%4.9% 7.3% 4.0%0.6%1.1%0.8%

0%

20%

40%

60%

80%

100%

25‐49 55‐64 25‐49 55‐64 25‐49 55‐64

Does not want to work Would like to work but is not seeking employment

Seeking employment (but not ILO unemployed)

Total Men Women

Source: Eurostat, Labour Force Survey, lfsa_igaww (figures exclude those that did not answer the question)

It would be interesting to know more about why such a large proportion of people aged 55‐64 become

inactive and are not interested in seeking new employment. Analysis of the way in which people currently

out of work (unemployed or inactive) but working the year before left their previous job (Table 7) reveals

that in 2009 more than half of the older people in this situation in the EU followed the path of retirement.

Of these, 40% reported taking early retirement and 60% regular retirement, though this does not mean

that they reached the official retirement age. It is interesting to note that the proportions forced to leave

their jobs due to redundancy or the end of a fixed term contract increased in 2009, especially the former,

as did the proportion taking early retirement. This is likely to reflect the reality of the crisis when many

people were forced out of their jobs unwillingly and as a result of these involuntary exits, increases the

proportion taking normal retirement, at a time of their choice, fell significantly.

It is worth noting that in several countries the figures differ significantly from the EU27 average (see Annex

– Table A.2). For example, in some Eastern and Mediterranean countries, plus France and Luxembourg

there is a consistently higher share of people aged 55‐64 leaving the labour market through normal

retirement. Early retirement is significantly above average in Denmark, the Netherlands and Poland where

amongst older workers 50% or more of leave their last job for this reason compared to 21% in the EU as a

whole. In Spain and Finland around one in four older people who are out of work say that they left their last

job because a temporary contract ended. This compares to just one in ten at EU level. Although temporary

work is very common in Spain it is so mostly amongst younger workers and in both Spain and Finland less

than 10% of older employees are employed on temporary contracts (Table A.1 in Annex). The high

proportions of older workers who report the end of a temporary contract as the main reason for leaving

their last job thus suggests that this group is particularly vulnerable when a fixed‐term contract comes to

and end.



Table 7 ‐ Reasons for leaving last job for people aged 55‐64 currently out of work but employed in the previous year, EU‐27, 2004‐2009.

% 55‐64

2004 2005 2006 2007 2008 2009

A job of limited duration has ended 8.4 7.1 7.8 8.7 8.5 10.0

Dismissed or made redundant 15.1 15.6 16.5 12.4 11.5 17.2Early retirement 18.9 18.2 19.7 18.9 19.2 21.4

Education or training 0.0 0.0 0.2 0.0 0.0 0.1Normal retirement 36.9 40.0 35.2 39.4 41.4 32.2Own illness or disability 11.2 10.9 11.2 11.1 10.3 9.8Other reasons 9.4 8.2 9.4 9.4 9.1 9.3

Total 100.0 100.0 100.0 100.0 100.0 100.0

Source: Own elaboration of EU LFS data. Other reasons include: Looking after children or incapacitated adults (from2006), other

personal or family responsibilities (includes code 02 from 2006) and other reasons.

Among older workers motivations for leaving their last job largely relate to the possibility of retirement

(more than 50% of cases), which is obviously not a relevant reason among younger people. Excluding those

who left their jobs to retire, the comparison between people aged 25‐49 and 55‐64 becomes more

interesting (Table 8). The main reason why older people who are currently out of work left their last job

other than to retire is dismissal or redundancy (37% of cases in 2009). Three other reasons ‐ termination of

a temporary contract, illness or disability and other reasons all account for around a fifth of the total. For

prime‐age people the main reasons are the termination of a temporary job and redundancy/dismissal. In

both cases, the incidence of redundancy/dismissal increased significantly in 2009 compared to 2007/8 as a

direct result of the crisis. The greatest difference between the older and prime‐age groups lies in the

proportion leaving their last job as result of illness or disability – 5.5% for prime‐age and 21.1% for older

workers. This is a real issue, both for the workers and for employers who associate older workers with

higher risk of health related absence from work. Helping older workers to overcome and manage health

issues and convincing employers that they can do so effectively is a crucial element in the struggle to

improve the employability of older workers.

Table 8 ‐ Reasons for leaving last job, excluding retirement, for people currently out of work but employed in the previous year by age‐group, EU‐27, 2004‐2009

% 25‐49 55‐64

2004 2005 2006 2007 2008 2009 2004 2005 2006 2007 2008 2009

A job of limited duration has ended

33.7 29.8 33.2 32.3 34.6 34.4 19.0 17.1 17.4 21.0 21.6 21.6

Dismissed or made redundant

30.0 31.4 27.3 24.4 22.4 31.9 34.3 37.2 36.5 29.8 29.2 37.0

Education or training 2.2 2.1 2.8 3.0 3.0 2.2 0.1 0.1 0.5 0.1 0.0 0.2Own illness or disability

5.4 6.2 6.8 7.6 6.8 5.5 25.3 26.0 24.8 26.5 26.1 21.1

Other reasons 28.7 30.6 30.0 32.7 33.2 26.0 21.3 19.7 20.8 22.6 23.1 20.1

Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Source: Own elaboration of EU LFS data. Other reasons include: Looking after children or incapacitated adults (from2006), other

personal or family responsibilities (includes code 02 from 2006) and other reasons.

When asked the reasons for not seeking work, the majority (58.5%) of older inactive people say that they

are retired, with illness or disability being the second most important reason (16.8%). Indeed, if retirement

is excluded, illness or disability is the main reason for as many as 41% of the remaining people and it

demonstrates the crucial need to deal with physical and psychological health‐related issues when trying to

encourage older people to stay in work. For prime‐age inactive people the main reason is looking after

children or incapacitated adults (mainly a female phenomenon), followed also by illness or disability.



Interestingly, the proportion of older inactive people who say that the main reason for not seeking work is

that they believe none is available is very low (3.6% in 2010) and lower than for prime‐age people. Even

excluding those who say they are retired, the proportion is hardly any different from the prime‐age group –

discouragement affects just under 9% of each group. This is somewhat surprising given some of the

evidence presented earlier – older workers who lose their jobs struggle to find work – they are liable to

become long‐term unemployed and many drift from unemployment to inactivity, which would suggest that

they have become discouraged and given up looking for work. Perhaps once they have retired this becomes

the main reason for no longer seeking work and if they were to be asked the reason for retiring perhaps

more would highlight discouragement effects. However, this is an intuitive interpretation and cannot be

confirmed from the available data.

Table 9 ‐ Reasons for not seeking work for inactive people by age group, EU 27, 2006-2010

% 25‐49 55‐64

2006 2007 2008 2009 2010 2006 2007 2008 2009 2010

All reasons Awaiting recall to work (persons on lay‐off) 0.9 0.9 0.9 1.1 1.2 0.2 0.2 0.1 0.2 0.2Looking after children or incapacitated adults

25.0 25.5 29.4 28.8 28.8 1.8 1.7 2.1 2.1 2.2

Belief that no work is available 7.6 7.4 6.7 7.6 8.3 3.4 3.0 3.0 3.3 3.6

Education or training 10.9 10.7 10.3 10.9 11.1 0.2 0.1 0.1 0.1 0.1Other personal or family responsibilities 19.5 19.3 15.7 15.1 13.9 8.1 8.1 7.3 7.0 6.5

Other reasons 16.8 16.5 15.3 15.6 15.4 13.6 13.4 12.9 12.4 12.0Illness or disability 16.6 17.4 19.4 19.0 19.3 15.3 15.6 16.8 16.6 16.8

Retirement 2.6 2.4 2.3 2.0 1.9 57.5 57.9 57.7 58.3 58.5

Excluding retirement

Awaiting recall to work (persons on lay‐off) 0.9 1.0 0.9 1.2 1.3 0.4 0.4 0.3 0.5 0.5

Looking after children or incapacitated adults 25.7 26.1 30.1 29.4 29.3 4.2 4.1 5.0 5.0 5.2

Belief that no work is available 7.8 7.5 6.8 7.7 8.5 8.1 7.2 7.0 8.0 8.7

Education or training 11.2 11.0 10.5 11.1 11.4 0.4 0.1 0.2 0.1 0.2

Other personal or family responsibilities 20.1 19.7 16.0 15.4 14.2 19.0 19.2 17.2 16.7 15.8

Other reasons 17.3 16.9 15.7 15.9 15.7 32.0 31.8 30.6 29.8 29.0

Illness or disability 17.0 17.8 19.9 19.4 19.7 36.0 37.2 39.7 39.8 40.6


2.6 Labour market transitions: re‐employment rates

The consequences of job loss can be particularly serious for older workers who are liable to have more

difficulty finding a new job than their younger counterparts. Moreover, even amongst those that do find

work there is a substantial risk that the new job will pay considerably less than the previous one (Johnson

and Mommaerts, 2011). Although this issue is beyond the scope of the current study, it has to be

highlighted because the potential magnitude of a drop in wages is likely to be an important disincentive for

displaced older workers to return to work.

Re‐employment rates measure the proportion of people who were out of work (unemployed or inactive) in

one year but employed in the next. Not surprisingly, people who are unemployed – and therefore by

definition actively seeking work – are more likely to be re‐employed than those who are inactive. What is

striking, however, is the difference between prime‐age and older workers (Figure 21). In 2010, nearly one in

three (31.2%) prime‐age workers who were unemployed in 2009 had found work but for the older

unemployed the chances of finding work were only one in seven (14.2%). In other words, an older worker

who is unemployed has less than half the chance of finding work again as a prime‐age worker. This



inevitably contributes to the high level of long‐term unemployment amongst older workers discussed

earlier.

Figure 21 ‐ Re‐employment rates by activity status and age‐group, EU‐27, 2004‐2010

25‐49

19.1%

5.7% 6.8%

31.2%

14.6%18.0%

16.2%

11.3%

17.0%

8.4%

32.0% 29.6%

36.8%

30.7%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2004 2005 2006 2007 2008 2009 2010

Other inactive Retired Unemployed

55‐64

14.2%

5.2%

3.3%

12.2%15.7% 12.9%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2004 2005 2006 2007 2008 2009 2010

Other inactive Retired Unemployed Source: Own elaboration of EU LFS data

There is a similar pattern for people who are inactive. For those who consider themselves retired, rates of

return to work are not surprisingly low – just 3.3% for those aged 55‐64 but roughly double this rate (6.8%)

for those aged 25‐49. More striking, however, is the difference between prime‐age and older workers for

all other categories of inactive persons, which includes those looking after the home or dependent

relatives, students, people who are sick, etc. Amongst this group, the rate of re‐employment amongst

prime‐age workers is 19.1% or nearly one in five but for older workers the rate is only 5.2% or one in

twenty. Indeed, amongst older inactive workers there is little difference in the re‐employment rates of

those who consider themselves retired and those in other situations of inactivity. For all of them the

likelihood of returning to work would appear to be very slim.

In general, re‐employment rates are higher for men than for women though the differences are more

prominent for prime‐age workers and amongst older workers are only significant for people who are

inactive but not retired (Figure 22). The most significant difference between the sexes is for prime‐age

inactive people (other than retired) where the re‐employment rate of men is some 6 percentage points

higher than that of women. The chances of finding work again are also affected by level of education, the

re‐employment rate increases with a better educational level for all groups (Figure A.2 in annex). It means

that older workers with low levels of education have the least chance of finding work again after losing

their job or, perhaps, that they are least likely to try to return to work.



Figure 22 ‐ Re‐employment rates by activity status, age‐group and gender, EU‐27, 2004‐2010

Other inactive in the previous year

23.8%

17.8%

1.9% 2.4%

20.4%

25.1%21.4%

13.0%16.0%

14.7%

6.8%4.6% 4.8%4.6%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2004 2005 2006 2007 2008 2009 2010


Retired in the previous year

11.6%

7.3%

3.5%

16.1% 9.2%

18.1%

2.9% 3.5%

4.0%0%

5%

10%

15%

20%

25%

30%

35%

40%

2004 2005 2006 2007 2008 2009 2010


Unemployed in the previous year

32.6%31.6%

39.4%

34.2%

29.6%29.8%

34.4%

29.7%

13.6%16.8%

13.4%14.3%

12.1%14.2%

10.1%

14.1%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2004 2005 2006 2007 2008 2009 2010



The literature offers a number of reasons why older displaced workers are less likely to become re‐

employed than younger workers. On the demand side, employers are reluctant to hire workers aged 55 or

over, because they are considered less productive and adaptable. Employers fear that they will not have

the time to recoup hiring and training costs before the employee retires (Johnson and Mommaerts, 2011)

and may also express concern that older workers are more expensive because of rigid seniority‐based wage

structures.

From the labour supply perspective, financial incentives embedded in pension systems and other welfare

benefits may play an important role in pushing older workers out of the labour market. Heyma and Van

Ours (2005) found that in the Netherlands abolishing the active job‐search requirement for recipients of

unemployment benefits from the age of 57.5 through to 65 (pension age) had a negative effect on the job

finding rate. Other studies have shown that lengthening the entitlement period of unemployment benefits

for older workers led to declines in the rates of transition to employment in Germany and Austria (Hunt

and Friedberg, 1995; Lalive, Van Ours and Zweimüller, 2004), and provided an important pathway into early

retirement (Lalive, 2006). On the other hand, reducing access to early retirement schemes can have very

positive effects. In Finland in 1997, the age at which people could stop collecting unemployment benefits

and transfer to an early retirement scheme was raised from 53 to 55. The result was that for the 53‐54 age‐

group the risk of unemployment fell, unemployment spells were shorter and transitions from

unemployment to employment increased (Kyyra and Wilke, 2007).

Such findings have important policy implications for the reforms needed to respond to the demographic

changes in Europe and the pressure they place on social security systems. In particular, policies aimed at

increasing the employment rates of older workers should take into account the role of job displacement

and its interaction with systems that can affect individual incentives. For instance, policies that aim to

enhance the chances of re‐employment for older workers might not be effective when used alongside a



generous unemployment insurance system that offers a low‐effort and relatively secure pathway to

retirement.

2.8 Labour market transitions: longer‐term observations

The data used for the majority of the analysis in this study derive from the Labour Force Survey, where for

the large part of the sample it is only possible to compare the situation of a person in one year with that in

the previous year. However, longitudinal data from the EU‐SILC, which are currently available for the period

2005‐2009, contain information on the employment status of those surveyed in each month over these 4

years so that it is possible to track their movements over 48 consecutive months, for example, from

employment into unemployment and back again or from unemployment into inactivity because of a failure

to find a job.

The sample chosen for study are those aged 50‐59 at the start of the period, i.e. in January 2005. Therefore,

the oldest person at the end of the period (in December 2008) still remains below the official retirement

age in most countries. Although the focus of the rest of the analysis is on those aged 55‐64, the relatively

small sample size of the EU‐SILC (especially of those included in the longitudinal survey for a 4‐year period,

who represent only 25% of the total number of people surveyed) means that the age group analysed needs

to be relatively wide in order to ensure that sufficient people are covered to make the results reliable. Even

then much of the analysis has to be carried out for groups of EU Member States in order to be sure that a

sufficient number of people are covered. It should be noted that these data are not available for all

Member States. There are no data in particular for Germany as well as Ireland and Romania. The analysis

therefore is inescapably limited to 24 of the 27 EU Member States.

Three broad issues were addressed on the basis of the data:

1. How many people who become economically inactive over the age of 50 – i.e. who in most cases

move into retirement – subsequently move back into employment, not necessarily in the same kind

of job they were doing before but into any kind of work? Are there more men than women or vice

versa who so this? How does the proportion vary by educational attainment level?

2. How many people who lose their job at this age are able to find another one? Are the chances

greater for men or women? What effect does education level have on these chances? How long do

people typically spend in unemployment before they find a job?

3. How many of those who become unemployed at this age subsequently move into retirement or

other forms of inactivity rather than back into work? To what extent does this vary between men

and women and how is it affected by education level?

Re‐employment from inactivity

Earlier it was shown that more than half of people aged 55‐64 moving from employment to inactivity do so

because they are retiring (Table 7) and that the chances of someone who is inactive in one year being re‐

employed in the next are slim (less than 5%). Using EU‐SILC data allows this analysis to be carried out over a

longer period and also to capture intra‐year changes. Table 10 orders countries in terms of the proportion

of people in the age group 50‐59 who moved from a spell of inactivity back into employment over the 4‐

year period 2004‐2008. The figures would appear to be generally in line with the annual data from the LFS –

given that they cover a four year period it would be expected that the chances of re‐employment over the

period would be higher and this is indeed the case, though not by much – the average is more like 7%

compared to around 4% on an annual basis. There are, however, notable differences between countries,

with people in the Netherlands, the UK, Finland and Sweden much more likely to have moved back into



work at some point in the four year period (between 11 and 15%) than those in France, Luxembourg, the

Czech Republic, Malta or Slovenia (all less than 3%). There is no pronounced tendency for a larger

proportion of men than women or vice versa to move back into employment, nor is there much sign of

education level affecting the numbers.

Table 10 ‐ Proportion of men and women aged 50‐59 in 2005 who moved out of inactivity into employment over the 4 years 2005‐2008

Sex: Men Women Total

Level of education: Low Med. High Total Low Med. High Total Low Med. High Total

NL 18.7 9.5 19.7 15.2 19.1 12.0 17.5 16.1 19.0 10.7 19.0 15.7

UK 16.7 12.0 21.6 15.7 13.2 17.7 14.8 15.5 14.5 15.0 18.4 15.6

FI 0.9 11.6 4.4 6.9 24.0 16.4 17.5 18.9 13.9 13.8 12.0 13.2

SE 10.9 11.0 20.9 13.4 13.6 7.2 11.3 9.8 12.0 9.1 15.7 11.7

PL 12.6 8.8 12.9 10.0 15.4 6.2 8.9 8.8 14.2 7.5 10.7 9.4

HU 1.3 8.2 12.4 7.9 7.9 10.0 12.9 9.9 6.1 9.1 12.7 9.0

IT 8.6 10.4 8.9 9.2 8.2 9.4 5.5 8.2 8.4 9.9 7.2 8.7

LV 12.3 8.4 13.3 10.0 5.0 8.3 7.3 7.7 8.8 8.3 9.6 8.7

BG 12.4 9.2 0.0 9.3 7.1 11.4 3.4 8.0 9.9 10.3 2.5 8.6

AT 10.0 3.5 0.0 4.2 11.7 10.6 8.1 10.7 11.1 7.5 2.9 7.8

PT 7.4 0.0 17.5 7.5 7.4 0.0 0.0 6.4 7.4 0.0 5.9 6.9

DK 13.4 2.6 13.1 8.6 5.8 5.1 3.8 5.0 9.0 3.7 8.5 6.8

BE 7.3 10.5 2.2 6.5 1.3 6.8 12.2 6.0 4.1 8.6 7.0 6.3

ES 3.4 4.4 3.8 3.7 12.0 10.7 3.5 10.6 6.1 5.7 3.7 5.5

CY 2.7 2.5 3.3 2.8 8.9 4.4 5.6 6.8 6.1 3.5 4.3 4.9

LT : 4.3 3.5 5.2 0.0 6.3 2.7 4.5 5.5 5.4 3.0 4.8

GR 0.9 0.0 7.6 2.0 9.0 4.1 0.0 6.6 5.3 1.9 4.1 4.4

EE 7.9 3.5 3.1 3.8 4.6 4.4 3.1 3.9 6.0 3.9 3.1 3.9

SK : 1.0 2.4 2.4 0.0 3.3 9.5 3.8 5.3 2.3 5.6 3.2

SI 3.8 3.6 3.8 3.7 2.1 3.2 0.0 2.1 2.8 3.4 1.7 2.9

MT 1.3 2.3 : 2.4 1.0 : : 2.8 1.2 6.0 14.0 2.6

CZ 1.3 2.3 0.0 1.9 0.5 3.2 6.9 2.9 0.7 2.8 2.5 2.4

LU 1.1 0.0 1.8 0.8 5.8 4.1 0.1 4.3 3.8 1.5 1.2 2.4

FR 0.4 1.1 1.2 0.8 2.2 1.9 0.0 1.8 1.4 1.4 0.6 1.3 Source: EU‐SILC. Data exclude DE, IE and RO ; “ : “ indicates that the sample is too small to be reliable.

Re‐employment from unemployment

Considering only people who were in employment at the start of 2005, nearly one in twelve (8.6%) became

unemployed at some point during the following 48 months (Table 11). The data shows clearly that the

chances of unemployment are significantly greater among those with low education and that the chances

for those with tertiary level education are very low. This is true in both the EU‐12 countries (i.e. the

Member States which have entered the EU since 2004) and the EU‐15, though the difference is more

pronounced in the EU‐12. Men are more likely to become unemployed than women, particularly in the EU‐

12, though this might reflect the possibility that more women in this age group did not bother looking for

another job if they lost their existing one and went directly into retirement.



Table 11 ‐ Proportion of men and women aged 50‐59 and employed in 2005 who experienced a spell of unemployment over the 4 years 2005‐2008

Men Women Total

% Low Med. High Total Low Med. High Total Low Med. High Total

EU12 16.1 10.9 5.1 10.5 12.3 9.4 3.5 8.5 14.1 10.2 4.2 9.5

EU15 10.8 9.5 3.3 8.5 9.8 8.8 4.2 8.1 10.4 9.2 3.7 8.3

EU27 11.2 9.9 3.6 8.9 10.1 9.0 4.0 8.2 10.7 9.5 3.8 8.6 Source: EU‐SILC. Data exclude DE, IE and RO

Of those people aged 50‐59 who were employed at the start of 2005 but then became unemployed, more

than half found another job at some point in the remaining months of the 4‐year period (Table 12). This

figure is perhaps high when compared to the figure from the LFS which indicates that more like 15% of

people aged 55‐64 were unemployed in one year but employed in the next (see Figure 21). However, there

are a number of factors that contribute to this difference. The SILC data cover only people who started the

period in work and do not include people who were already unemployed or who were inactive and then

became unemployed. The SILC data are therefore restricted to people with recent experience of work who

are likely to be more employable. They also take account of movements into work at any point over the 4‐

year period whilst the LFS data compare the situation of individuals one year apart and with a high

proportion of older unemployed being out of work for more than a year, sometimes considerably so, a

significant proportion of re‐employment cases will occur only at a later date. The age‐group covered may

also have an impact – the LFS data showed clearly that re‐employment rates amongst younger age‐groups

were significantly higher than in the 55‐64 age‐group and the fact that the SILC data covers a cohort that

starts off five years younger will tend to result in higher re‐employment rates.

Results based on the SILC data (Table 11) show little difference between the EU‐12 and EU‐15 in terms of

overall re‐employment rates but do suggest important differences between the two as regards those with

different education levels, especially for men. In the EU‐12, men with tertiary level education were

significantly less likely to have found a job than those with lower or upper secondary education, though this

is not the case for women. The reverse situation applies in the EU‐15 where people with high levels of

education, both men and women, were much more likely to find work again. These findings broadly concur

with the LFS data.

Table 12 ‐ Proportion of men and women aged 50‐59 and employed in 2005 who became unemployed and found another job over the 4 years 2005‐2008

Men Women Total


EU12 54.1 60.5 38.9 57.3 63.9 49.0 61.6 53.7 58.7 55.8 48.8 55.8

EU15 50.9 53.4 76.6 54.3 48.9 58.2 70.1 55.6 50.1 55.4 73.4 54.8

EU27 51.3 55.8 67.9 55.0 51.1 55.2 68.4 55.1 51.2 55.6 68.1 55.1 Source: EU‐SILC. Data exclude DE, IE and RO

Around 17% of the same group (i.e. those employed at the start of 2005 and then unemployed) moved into

inactivity instead of into a job and remained in that situation to the end of the observation period (Table

13). Given the age‐group, it is likely that the majority of these people will have retired but this cannot be

verified from the data and some may be in other situations (e.g. sick or caring for others). This transition

was more common in the EU12 (24%) than the EU15 (14%) where, accordingly (given that similar

proportions found work again), more people remained unemployed, perhaps because they considered it

more likely that they would eventually find a job or because the social protection system, and perhaps the



PES, supported and encouraged them to keep looking. In the EU12, though not so much in the EU15, it is

people with highest levels of education that are most likely to move from unemployment into retirement

(or other inactivity), perhaps because they can afford to do so in the sense of having access to a pension.

Again, it is worth reflecting briefly on differences between the observations based on SILC data and those

reported earlier based on LFS data. The latter showed that as many of 46% of those aged 55‐64 who were

unemployed in 2009 were inactive in 2010, which is significantly higher than the 17% observed in the SILC

data. Firstly, as mentioned previously, the SILC data cover a restricted sample of those employed at the

start of the period and excludes people who were unemployed at that time or who were inactive and then

became unemployed. These groups are liable to be less employable due to a more distant experience of

work and therefore more likely to give up looking for work. Additionally, the SILC data on labour status are

self‐reported and some of those who consider themselves unemployed are liable to be counted as inactive

in the LFS where the strict ILO criteria are applied.

Table 13 ‐ Proportion of men and women aged 50‐59 and employed in 2005 who became unemployed and then moved into retirement or other inactivity over the 4 years 2005‐2008

Men Women Total


EU12 12.5 17.3 47.1 19.0 12.1 35.2 37.1 30.0 12.3 24.5 42.7 23.6

EU15 9.0 14.0 12.9 11.4 24.2 16.6 5.7 18.6 14.8 15.1 9.4 14.4

EU27 9.4 15.1 20.7 13.2 22.4 22.8 11.9 21.4 14.5 18.3 16.6 16.6

2.8 Job‐search methods of older workers

Older and prime‐age workers have slightly differently job‐seeking habits. Most people use multiple

methods for seeking work but, on average, prime‐age unemployed persons seem more active and use more

than 4 different kinds of research methods per person, while older unemployed persons use an average of

3.5 different methods (Table 14); in both cases the intensity of research has increased in recent years,

probably as a result of the crisis and the increasing difficulties in find a job.

Prime‐age unemployed people are most likely (in order) to study adverts in newspapers or journals, exploit

personal networks or to apply directly to employers. In 2010, 61% of prime‐age unemployed say that they

contacted the public employment service within the past four weeks in order to seek work, while 19% was

waiting for a call from a PES office. However, older workers are most likely to refer to the public

employment service, followed by adverts or personal contacts. They are much less likely than prime‐age

workers to contact employers directly (47% vs. 62%). Interestingly, the use of the public employment

services seems to be declining for both age‐groups, while direct application to enterprises and networking

with friends, relatives and trade unions increased in the last years. According to the data, use of private

employment agencies is relatively infrequent with only 20‐25% of prime age unemployed and 15‐17% older

unemployed saying that they used this method.

Although they may not be immediately available for work, part of the population considered inactive also

wants to work and is taking steps to find work. In this case the intensity of the research is lower than for

unemployed people, and on average the prime‐age group use 2.3 methods, while older inactive people use

around 1.5. As with unemployed jobseekers, the proportions using each method are lower for the older

workers than prime‐age workers in almost all cases, indicating that they are generally less likely to use

multiple job‐search methods.



For both prime‐age and older inactive people, contacting the public employment service was the most

common method of job‐search in 2010, though the numbers are relatively low – less than half of prime‐age

and only just over a third of older inactive jobseekers contacted the PES within the last four weeks (Table

15). If PES are to effectively help activate such groups, ways of increasing contact need to be found. It is

noticeable, moreover, that use of the public employment service has declined significantly for the older

age‐group.

Table 14 ‐ Job‐search methods of the unemployed by age‐group, EU‐27, 2006‐2010

% using each method 25‐49 55‐64

Methods 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010

Contacted public employment office 65.4 65.0 61.8 61.9 60.9 72.0 72.9 68.7 64.8 65.5

Contacted private employment agency 20.4 20.4 22.5 24.1 23.7 15.4 14.9 16.0 17.0 17.0

Applied to employers directly 51.7 50.2 52.9 60.1 62.3 33.7 35.2 36.4 44.9 46.8

Asked friends, relatives, trade unions, etc. 62.6 61.7 62.3 68.4 70.8 50.6 50.3 50.0 60.6 62.0

Inserted or answered advertisements in newspapers or journals

43.6 42.1 40.4 43.5 45.1 37.5 37.0 34.7 38.6 36.6

Studied advertisements in newspapers or journals 69.1 67.9 67.8 72.3 73.6 58.5 56.6 59.1 64.3 64.4

Took a test, interview or examination 17.1 17.3 17.8 17.7 17.9 8.8 9.3 8.5 9.2 9.7

Looked for land, premises or equipment 3.3 3.3 3.5 2.1 1.9 1.5 1.6 2.3 1.5 1.4

Looked for permits, licenses, financial resources 2.4 3.1 3.3 1.6 1.7 1.0 1.6 1.7 1.0 1.1

Awaiting the results of an application for a job 16.8 17.1 18.0 20.1 21.9 9.3 10.2 9.7 12.2 13.9

Waiting for a call from a public employment office 15.1 14.3 15.0 18.1 19.4 10.5 11.4 11.9 15.1 15.8

Awaiting the results of a competition for recruitment to the public sector

1.4 1.4 1.3 1.4 1.6 0.4 0.3 0.2 0.5 0.5

Other methods 22.8 24.6 22.8 18.2 16.7 19.7 21.7 19.5 18.4 18.8

Average number of methods used 3.9 3.8 3.8 4.1 4.1 3.2 3.2 3.1 3.5 3.5

Totals in each column exceed 100% because many jobseekers use multiple methods. Source: Own elaboration of EU LFS data

Table 15 – Job‐search methods used by inactive people seeking work by age‐group, EU‐27, 2006‐2010

% using each method 25‐49 55‐64

Methods 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010

Contacted public employment office 48.0 50.2 41.5 45.7 46.1 51.7 57.5 40.3 45.2 34.6

Contacted private employment agency 9.0 10.2 9.1 10.3 9.7 4.2 2.7 3.9 7.1 7.2

Applied to employers directly 22.5 21.3 20.9 27.1 24.8 5.0 7.4 7.0 14.3 14.3

Asked friends, relatives, trade unions, etc. 31.2 31.8 28.8 35.7 34.3 10.0 16.3 12.2 22.5 24.7

Inserted or answered advertisements in newspapers or journals

21.3 22.0 19.8 27.0 26.4 8.5 8.4 8.9 18.9 15.3

Studied advertisements in newspapers or journals 38.6 39.6 36.1 44.9 42.3 16.2 14.8 15.1 34.0 29.9

Took a test, interview or examination 8.2 7.3 8.7 9.7 8.3 1.9 1.7 2.5 3.9 2.5

Looked for land, premises or equipment 3.6 3.1 2.4 2.8 2.9 0.5 0.4 0.2 0.5 0.6

Looked for permits, licenses, financial resources 3.7 2.6 2.3 2.5 2.7 0.3 0.2 0.4 1.9 0.4

Awaiting the results of an application for a job 7.8 7.8 7.9 10.6 9.7 1.4 2.5 3.3 5.5 7.9

Waiting for a call from a public employment office 14.1 12.8 9.0 9.1 9.3 28.1 22.9 14.5 12.8 10.3

Awaiting the results of a competition for recruitment to the public sector

1.0 0.9 1.0 0.8 0.9 0.0 0.0 0.7 0.1 0.8

Other methods 16.8 18.7 16.4 18.6 17.1 6.2 11.2 8.6 13.3 12.5

Average number of methods used 2.3 2.3 2.0 2.4 2.3 1.3 1.5 1.2 1.8 1.6

Totals in each column exceed 100% because many jobseekers use multiple methods. Source: Own elaboration of EU LFS data

These results prompt some general reflections on the role of PES in supporting the job‐search activities of

senior workers:



there are many ways of seeking work and most people use multiple search methods but the PES

still plays a central role for both unemployed and inactive people, and especially for older people;

traditional methods of jobsearch such as responding to adverts in printed media or networking

through relatives and friends continue to have an important function and should not be seen as

alternative but complementary to the PES;

PES are used actively by a large number of job seekers but there is room to extend their action

especially among older inactive and older people, whose current use is more limited;

the tendency for direct contact with companies to increase as a method of job‐search is probably

linked to modern communications technology. Again, although such methods reduce the need for

intermediaries, they should not be seen as an alternative to PES and are (or can be) supported by

them.

2.9 Summary of main findings from the analysis of labour market trends

Analysis of the labour market situation of older workers and the impact of the crisis shows that:

There is a long‐term trend for people to work longer, which has resulted in a significant increase in

employment rates of older workers over the past decade or so. The crisis has slowed but not arrested

this trend and employment of older workers is continuing to rise. In this sense, older workers are doing

well on the labour market compared to other age‐groups, which suffered the brunt of job‐losses during

the recession. However, employment rates of older workers in many European countries are still

relatively low, a long way behind those of other advanced economies, and this is not sustainable in the

medium to long term as the population ages and there are projected labour shortages and an increased

demand for pensions and long‐term care. Combined in the right way, ALMP and other services of the

PES can be used to strengthen the general trend to stay longer in work by acting to remove constraints

in work organisation, social habits and local welfare.

Older workers are more likely than prime‐age workers to be employed for less than full‐time hours,

which makes sense as a transition to retirement. They are less likely to be employed on a temporary

contract and more likely to be self‐employed. The former may have offered some protection during the

crisis as those on fixed‐term contracts were among the first to be dismissed. However, there is no real

evidence to suggest that any of these factors can fully explain why older workers were less affected by

the crisis. It is clear, however, that a well defined system of reduced working time could be a useful

instrument to keep older workers at work and that, without resorting to early retirement schemes, the

mutual interests of older employees and employers can be maintained even in a period of crisis.

Older workers are less likely to be unemployed than other groups but once they lose their jobs the

problems start. Once unemployed, older workers take much longer to find work and are liable to

become long‐term unemployed. The rate of re‐employment is low ‐ only one in seven older people who

were unemployed one year are back in work in the next compared to one in three prime‐age workers.

This difficulty in getting back to work implies that extra effort is required from the PES to help them

effectively. In particular, PES have to learn to deal with the multidimensional problems that tend to

confront older workers (family care, health, low marginal return of investment in human capital, self‐

empowerment) in relation to their age and the condition of long term unemployment.



Moreover, around half of older unemployed each year give up looking for work and become inactive.

The low chances of finding work (evidenced by the high incidence of very long‐term unemployment

among older workers) represent a level of discouragement such that many older workers leave the

labour market much earlier than they would like. This type of exit is facilitated by the persistence in

some countries of early retirement schemes and extended eligibility to unemployment benefits without

any obligation to seek work.

Once inactive, the chances of returning to work are minimal. Re‐employment rates of older workers are

not surprisingly low for those who say that they have retired (3%) but are also very low for other

categories of older inactive people (5%). This, together with the previous points, highlights how

important preventive interventions that can help to preserve employability and anticipate

discouragement effects may be for older workers.



3. Overview of national initiatives to support older workers

Having shown the problems that out‐of‐work older workers have in finding new employment, the question

is what is being done to help them and what more needs to be done. In terms of help aimed at improving

the employability of older workers or creating jobs for them the answer to the first part of the question is

that, upon a review of policy documents and available report of empirical research, there are important

initiatives in some EU Member States, but there is no systematic approach and the initiatives are generally

few compared to those targeting other age groups. Although there is a multitude of active LMP services

and measures specifically targeted at young people who, it has to be said, were particularly hard hit by the

crisis, few public employment services offer employability services/measures specifically targeted at older

workers. Older workers are free to participate in the full range of labour market services/measures on offer

and there are also various systems of employment subsidy to encourage employers to both recruit and

maintain jobs for older workers. However, there would appear to be a lack of services/measures designed

to improve the employability of older workers and which are really tailored to their specific needs,

including health issues. PES are now required to address the labour needs of unemployed and employed

job seekers among the 55+ age group who, until recently, have not among the priority client groups of PES

(Hake, 2011).

This chapter presents five small case studies from Bulgaria, France, Germany, the Netherlands and Poland.

The first case gives an example of an inter‐generational approach, facilitating the re‐entry of both older

workers and new parents into the labour market; the second case presents the overall strategy and main

initiatives that the French PES has put in place in order to support senior workers’ employability; the

German case describes an initiative aimed at activating and re‐integrating long‐term unemployed older

workers into the labour market, using also innovative tools such as psychological and heath support; the

Polish practice provides an example of a stimulus to self‐employment; finally the Dutch experience shows

how to promote labour participation of jobseekers aged 55‐60, using coaching and networking groups.

Each case study is structured as follows: the national context in which it was implemented; the policies to

both retain and re‐integrate older workers (programmes and achievements), and, where available, a brief

overview of the overall PES strategy towards older workers; the conclusions and lessons learned from these

experiences. In addition to the case studies, the chapter includes a brief examination of employment

subsidies for older workers available across EU Member States.

3.1 Bulgaria

This first case‐study focuses on the Bulgarian experience with particular attention on a scheme called “Back

to work”.

The national context

The demographic changes that tend towards an ageing population and shrinking workforce represent a real

challenge to the long‐term economic and fiscal sustainability of Bulgaria. Those aged 55‐64 are a already

significant portion of Bulgaria’s labour force (14%) and their importance is likely to increase over time. As a

result, measures are needed to increase the labour market participation of senior workers and the supply

of labour.



The pension reform adopted recently (in force from 2012) envisages a gradual increase in the length of

service for workers to 40 years for men and 37 years for women. The retirement age will also increase to 63

in 2026 for women and 65 in 2024 for men.

The activity and employment rates for people aged 55‐64 in Bulgaria are considerably lower than those for

the overall working age population (25‐64), though both have almost doubled since 2000 and the

employment rate for people 55‐64 in 2010 (43.5%) was not too far from the EU average (46.3%). However,

in the 2008 ‐ 2010 period, following the financial and economic crisis, the employment rate in Bulgaria

started to diminish for all age groups, including older workers, and unemployment rates increased. The

table below shows that the employment impact of the crisis on older workers is similar to that of the

overall working age population. Interestingly, during the crisis job opportunities for older employees

decreased significantly in the private sector but actually increased in the public sector. The number of self‐

employed, employers and unpaid family workers aged 55‐64 also fell, reflecting the fact that family

businesses were affected by the effects of the recession.

Table 16 ‐ Activity, employment and unemployment rates (total and older workers)

Years Activity rate Employment rate Unemployment rate

25‐64 55‐64 25‐64 55‐64 25‐64 55‐64

2000 69.6 25.1 59.6 22.1 14.4 12.2

2005 70.6 29.4 64.2 34.7 17.7 8.6

2007 75.5 45.7 70.8 42.6 6.2 6.8

2008 76.8 48.7 73.0 46.0 5.0 5.5

2009 76.0 49.2 71.4 46.1 6.0 6.3

2010 75.0 47.9 68.1 43.5 9.2 9.3

Source: Eurostat, Labour Force Survey: lfsa_ergan, lfsa_urgan, lfsa_argan

As elsewhere in Europe, the serious problems for older workers in Bulgaria arise once they become

unemployed. The options for people aged 55‐64 who lost their jobs are limited: entering a special job‐

searching programme, finding (precarious) work in the “grey economy” or exiting the labour market

altogether. Though there is also an additional option, as some unemployed people aged 50+ may emigrate

and find work as agricultural workers or housekeepers in neighbouring countries. Whether unemployed,

employed or inactive, older people face a variety of problems in getting and keeping jobs in the longer

term. These include: lack of recent experience in job search, health issues, and persistent negative

perceptions about the motivations and capacities of older workers to adapt to technological and

organisational change. Changes to the skill sets required by employers reduce the competitiveness of this

age group. In this sense the underdeveloped life‐long learning (LLL) system in Bulgaria is also a problem, as

only 1.4% of the labour force in the country participated in LLL in 2009. In addition, the difficulties senior

workers face in employment reintegration were exacerbated by the recent economic downturn because of

the tight labour demand causing a higher competition with other jobseekers.

Measures to retain and (re‐)integrate older workers

The situation described above outlines the need for relevant labour market policies to support the

employment re‐integration of older workers in the event of unemployment. Moreover, in the present

economic situation, the risk of large‐scale displacement and long‐term unemployment of older workers has

increased progressively. In order to overcome this situation, an integrated flexicurity approach is being

implemented. National policy recognises senior workers as a vulnerable group and the National

Employment Agency of Bulgaria (NEA) is implementing actions within the context of the Encouragement of



Employment Act (EEA) and in the National Action Plan for Employment in order to sustain the social

integration of unemployed people over 50. Although active labour market measures in Bulgaria are

generally open to all age groups, in recent years a number of national funded initiatives specifically directed

to unemployed people over 50 have been successfully implemented:

A national programme called “Help for Retirement”. This programme provides employment to

unemployed people who are 5 points short of qualifying for the right to a pension. Unemployed people

are provided with full or part‐time work for a period of 3‐12 months, depending on how many points

they need to earn. The programme pays all expenditure incurred by the employer, including wage,

social insurance, additional payments, etc. In order to participate in the scheme, the unemployed

person should not be over 65+, as at that age people obtain pension rights automatically. There were

1,394 participants in the programme in 2010 and the programme had a budget of 3.9 million BGN9, of

which 3.4 million came from the state budget. In 2011 the programme aims to provide employment to

742 people with a budget of 1.9 million BGN.

Under the Encouragement of Employment Act (art. 55a of EEA), there is a measure providing financial

incentives to employers who hire people aged 50+. In 2010, 375 people were employed under this

measure, which had a budget of 357,000 BGN. The same act includes a measure to encourage

employers to hire unemployed people between 50 and 64 years old, who have acquired a right to a

professional pension for earlier retirement (article 55 b of LEE).

People aged 50+ are also one of the target groups of the national programme “Social Services in Family

Environment”, through which unemployed people provide caring services to other people (i.e. disabled

people).

The National program “Supporting motherhood”, in which older workers are trained to work as child

minders.

ESF funded initiatives targeted mainly at unemployed people over 50s have also been deployed:

The initiative “Back to work”, continues the framework of the above mentioned national programme

‘Supporting motherhood’, which offers job placement opportunities to older people to help young

workers with children to combine family and professional life. This initiative is described in detail

below10.

“Development” Scheme is a part of the Operational Programme “Human Resource Development”.

Under this scheme people aged 50+ are given the opportunity to obtain relevant qualifications. In 2010,

2,627 workers aged over 55 were given training. The funding provided amounted to 640,000 BGN.

People aged 50+ have also access to all programmes, encouragement measures and schemes of

“Human Resource Development Operational Programme”.

Other initiatives funded by the ESF to support senior workers (such as those for training activities or

inter‐generational transfer of knowledge – i.e. “Providing conditions for active working life for people

over 50 and long‐term unemployed persons”, or the initiative “Creating employment for youth through

insuring a chance for apprenticeship”)

The “Back to Work” project represents an interesting initiative that offers training and job placement

opportunities to older people wanting to work in the child‐care industry, while providing also opportunities

9 The exchange rate between the Bulgarian Lev and Euro was 1BGN = 0,51 € on 10 November 2011. 10 The initiative is not directly targeted at unemployed people over 50, however these people have priority.



for younger workers with children to return to work. The scheme started in 2009 in the wake of the

National program “Supporting motherhood”, as a programme promoting reconciliation of work and family

life of both parents (in line with the broader policy of the Bulgarian Ministry of Labour and Social Policy). It

was originally established to aid the integration of young mothers in the labour market by providing

alternative childcare options to children between 1 and 3 since the places in kindergartens were limited.

However, the aim of the initiative was also to create new jobs for the unemployed people registered in

Local Labour Offices. Therefore, overall, the initiative was conceived to:

Create new work places for unemployed people actively seeking work; Create conditions for easy transitions and women returning to work after their maternity leave; Guarantee a better balance between personal and professional life of new parents.

Two National Agencies are involved in the project: the NEA and the Agency for Social Support (ASS). The

NEA acts as both a contracting authority through its “European funds and international projects” (EFIP)

General Directorate and a beneficiary through its “Employment services” (ES) General Directorate. The ASS,

provides training for the unemployed people selected to participate in the programme and thus gives them

the opportunity to acquire new knowledge and skills and professional satisfaction on the labour market. An

agreement concerning the “Back to work” initiative between the two institutions (NEA and ASS) was

concluded on the 12th of March 2010.

The scheme is funded by the European Social Fund (ESF) and the Ministry of Labour and Social Policy. The

total budget is 32 million euro (85% ESF funding and 15% national resources), and activities are

implemented throughout Bulgaria. The project is planned to last 35 months (February 2010 – December

2012)11 and aims to train 8,500 people in child care and placed 8,000 people in jobs.

The main phases through which the “Back to work” project operates are the following (Figure 23):

1. Gathering applications both from parents and unemployed people. Local Labour Offices of NEA collect applications from both families interested in having someone to care for their children and unemployed

people interested to become carers.

2. Assessment of both types of applications. Local Labour Offices of NEA are also in charge of the

assessment and approval of the applications of both parents and unemployed people. Currently,

eligibility for jobseeker applicants is based on several criteria, such as registration as unemployed,

relevant mental and physical health status, legal clearance and declaration that the people wish to be

included in such activities. Priority is given to people with qualifications in education, social and health

services and unemployed people in preretirement age who need additional length of service to acquire

the right to retire. On the family side, at least one of the parents must be employed or self‐employed

when the application is submitted and at least one should be on parental leave. Parents should not

already be included in the national ’Supporting Motherhood’ programme, and the child cannot be

registered in child care centres or kindergartens. Priority is given to single parents, families with many

children, parents of children with disabilities, families in which one or both of the parents have

disabilities, and families whose monthly income is less than 2 average work salaries.

3. Directing suitable unemployed people to the approved parents. Local Labour Offices of NEA mediate

between successful unemployed applicants and approved families who need a carer.

4. Approval of the unemployed people by the parents. Parents have the right to choose the unemployed

person who will take care of their child.

11 The project started on the 25th of February 2010, but it continues the policy of the national funded program ‘Supporting Motherhood’ which started in 2006 and will be in place until 2012.



5. Including the unemployed people in training. Approved unemployed people are then trained in key

competences, such as caring for young children, and are thus equipped to work with them. Beside

vocational training, motivational training is also provided. The NEA, as the managing authority of the

project, refers approved people in training organised by the ASS, which issues them with a participation

certificate at the end of the training period. The training lasts 1 month and costs the ASS 300 LEV per

person (about 200 Euros).

6. Including trained unemployed people in employment. The NEA is also in charge of allocating trained

people to jobs. In particular, it signs work contracts for the position of ’Child carer‘ for a period of 3 to

24 months and provides a minimal monthly salary and insurance to trained workers. Thus trained child

carers have contracts directly with the NEA. At the end of their contract period carers are included in a

list from which they can be selected for other jobs by families taking part in the project.

Figure 23 – Back to work project phases

Source: Bulgarian National Employment Agency

The NEA is in charge also of the monitoring of the quality of the child care activities and has implemented a

system through which representatives visit families taking part in the project once a month to verify that

the services are being provided satisfactorily.

The “Back to work” scheme is particularly attractive for women12 of pre‐retirement age, who have become

unemployed due to the restructuring of public health and education services as part of fiscal consolidation

measures undertaken by the state. Initially, pensioners or women of pre‐pension age were the first groups

to be involved in the scheme. Later, due to high demand, the scheme was expanded to include more target

groups and a broader eligibility. At the end of September 2011 the scheme included 1,416 families and

1,692 unemployed people who have been trained in childcare, of which 755 were aged over 55, as well as

77 instructors13. In total, 708 unemployed people over 55 were employed (1,426 people in total). The PES

regularly monitors the progress of the scheme and reports results to the NEA. At this stage, the scheme is

deemed to be relatively efficient with respect to its target and the use of funds.

Conclusions and lessons learned

12 So far just two approved carers are men, and they are both relatives of the children. 13 The number of civil contracts concluded so far by ASS for instructors is 169.



Labour market activation and employment amongst older people in Bulgaria have increased greatly in the

last decade or so, however much more needs to be done. There are several national projects targeting

senior workers in Bulgaria, but additional initiatives are needed. Moreover, a system of co‐ordination of the

current and future initiatives is fundamental to activate a learning process and avoid duplications.

The ESF plays an important role in supporting such initiatives. Evidence from current programmes shows

that it is efficient to rely on ESF funding for projects that are generally short‐term and often operate on a

local basis. The success of the support provided depends also on the interests of the actors and their joint

efforts to design simple and flexible programmes. Partnerships between different actors with different

expertise are also key aspects in the policy design of these initiatives. The ‘Back to Work’ scheme is a

successful example also in this respect. Other interesting lessons can be drawn from this project. The

intergenerational support at the basis of the project is an important instrument to motivate senior workers,

facilitating their acceptance by employers (families) and favouring their re‐insertion in the labour market.

This approach can be replicated in other countries or in other sectors (for instance, handicraft). The training

component of the project appears fundamental to provide qualified and standardised services on the one

hand, and to motivate and empower older workers on the other. The ”Back to Work” scheme also helped

older workers to exit from the grey economy and can represent a starting point also for business creation in

the caring industry.

The good employment results of the project are largely dependent on direct public support for salary costs

and this can make it difficult to sustain in the longer term; the results and the final impact should be

verified at the conclusion of the project. However, for vulnerable groups, including older workers, it is

important to carefully consider the trade‐off between no occupation and occupation made possible

through public funds; in the case of vulnerable groups, the social value of the financial support is higher and

if temporary occupation can be associated with real activation and empowerment of the worker there may

be important positive effects for society as a whole.

3.2 France


The employment of older people is now absorbing considerable public attention in France and public

strategy towards senior workers is currently being revised. Getting more older workers to be active in the

labour market would not only help strengthen French economic performance, but reduce pressure on

pensions and public finances generally. As in many EU countries, France is facing the demographic

challenge of an ageing population, though it is less affected than many other EU countries as the active

population is not projected to start contracting before 2060.

In the last two decades or so the French government has begun to respond to the older workers issue.

Since the mid‐1990s, it has greatly restricted access to publicly funded early retirement schemes, after

having extensively resorted to such schemes in the past. More recently, France has ended the possibility for

older workers to claim unemployment benefits without any obligation to maintain any job search activity.

With early retirement options no longer available, unemployment benefits had become another way to

leave the labour market early. A series of decisive steps to encourage workers to remain active longer have

been taken since 2003 with successive reforms of pension schemes, with the most recent being in 2010. In

addition, a National Action Plan for the employment of senior workers was launched at the beginning of



June 2006. This plan concludes a national intersectoral agreement established in October 2005 and aims to

improve employment opportunities and conditions for older workers. The plan of action, to be enforced

between 2006 and 2010, aimed to reach an employment rate of 50% among people aged from 55 to 64

years by its final year of application.

France also launched a campaign in 2008 l’expérience des plus de 50 ans which highlights the value and

qualities of senior workers. It is directed in particular at corporate executives and human resource

managers in order to raise their awareness of the added value senior workers can bring to the workplace.

Against the background of these various actions and policy developments, the employment rate of 55‐64‐

year‐old French workers increased from 29.4% in 2000 to 38.5% in 2005, and up to 39.7% in 2010

(Eurostat). However, despite an increase of just over 10 percentage points over the last 10 years, the

employment rate of French older workers is still a long way behind the level set by the National Action Plan,

and more than 6 percentage points lower than the EU‐27 average for 2010 (46.3%).

Throughout the economic crisis, as in many EU countries, the impact on senior workers in France has been

relatively mild compared to that on prime‐age workers. Indeed, the employment rate of people aged 55‐64

in France rose by 1.5 percentage points between 2008 and 2010, more than the increase for the EU as a

whole (0.7 pp)14. At the same time the employment rate of prime‐age workers fell by 1.6 pp compared to a

decline of 2.3 pp in the EU as a whole.


The French public employment service, Pôle Emploi, considers all jobseekers aged above 50 to be senior

workers. Its mission is to work with senior jobseekers and companies and to work with relevant partners to

provide placement and guidance services for senior jobseekers. Pôle Emploi aims to increase the rate of

employment of people aged 55‐64 to reach the objective of 50 % (for 2010 and after), as well as to

encourage seniors to stay on the labour market longer and to increase the rate of sustainable employment

for older workers.

Actions of Pôle Emploi in favour of older worker takes account of the difficulties that older people face in

accessing paid employment once they lose their job. Barriers to re‐employment arise from several factors,

including negative personal perceptions and barriers posed by the labour market and employers. Among

the first category of barriers are: difficulties to accept loss of previous employment and working conditions,

difficulties to value skills and skills acquired through experience, a need for longer and more intensive

support to convince people that they have the capacity and motivation to start again and take‐up a new

career path. Barriers coming from the labour market and particularly from the employers include: strong

hesitations to recruit older workers, companies still in favour of schemes facilitating early leaving, wish to

rebalance their age pyramid, unwillingness to adapt working conditions in the workplace, salary level for

older workers 20 to 30 % higher than that of people aged 30‐39, lower level of training and unwillingness

to update qualifications and skills, in competition with young graduates on the labour market.

Pôle Emploi’s service offer for older workers includes the following:

Measures to encourage people to remain or return to employment;

Tailored counselling services;

14 Source: Eurostat, Labour Force Survey: lfsa_ergan



Every older jobseeker has a personal counsellor from the first month of unemployment (younger

jobseekers only have a counsellor from the fourth month of unemployment). More intensive support is

provided by organisation of group activities – named “senior clubs” – targeted at supporting and

empowering older job seekers. The main objective of these clubs is to get older workers into a network

with other senior jobseekers, which visits companies in order to establish job opportunities.

Other tailored counselling services include:

- skill assessments;

- career guidance and access to training or retraining;

- post‐employment support.

Pôle Emploi offers also services targeting enterprises in order to encourage and promote the employment

of seniors. These include:

in work assessment, hiring simulation methods and initiatives to encourage alternative working forms

(i.e. new business start‐up);

age‐awareness communication plans, forums, and breakfast meetings with French companies; also

human resource clubs through which companies can exchange information on seniors including

organisation of quarterly meetings of national “Human Resources Clubs” with decision‐makers from

large companies.


The initiatives implemented by Pôle Emploi have so far had significant results in terms of the employability

and re‐employment of senior workers. Their first key factor for success is the provision of tailored services

that support older jobseekers from the first month of unemployment up to the post‐employment phase.

They also support alternative working forms, with actions targeting senior jobseekers who are willing to

start their own business.

Close cooperation with social partners and local businesses are also fundamental. Services for employers

include advisory services and consultancy to employers, particularly SMEs. Awareness‐raising activities and

training in age management are also essential to demonstrate the advantages of employing a senior

workers and thus convince employers to hire them.

In terms of future developments, breaking with the tendency for workers to make an early exit from the

labour market requires a multi‐dimensional strategy from Pôle Emploi that takes account also the

expectations of firms. This strategy, which will be subject to consultation with social partners, will be based

on:

the development of a career‐oriented culture, based on a wider career planning approach to help

develop people’s employability from the earliest age;

the engagement of employers on the improvement of working conditions, occupational health and the

wishes of workers about mobility and skills developments;

the recognition of senior workers’ experience and the maintenance of human capital as an asset for the

enterprise (also in order to identify and transfer know‐how to younger employees);

the revision of work organisation in order to foster cooperation between generations and develop

alternance for adult workers;



the implementation of mechanisms enabling sharing of senior workers between several firms.

3.3 Germany

This case‐study focuses on the “Perspektive 50+” agenda, which has been implemented since 2005 to

support older workers in Germany.


In the last decade, the labour market for older workers has been subject to significant changes. In January

2005, labour market reform changed the unemployment assistance from a system based on a replacement

of past earnings to a system based on a sociocultural living wage, leaving older unemployed persons with a

long employment history worse off. The maximum duration of unemployment benefits was cut from 32

months to 18 months for older workers aged 57+. This change also affected early retirement schemes,

namely reducing the possibility to use unemployment benefits. Finally, in 2007 the official retirement age

was raised from 65 to 67 and in December 2009 subsidies for early retirement schemes expired.

Already in 2005, the scheme “Perspektive 50+” was launched in order to help older unemployed persons

cope with the new situation. Following the labour market reforms and the increase in retirement age there

was a serious public debate about the predicament faced by older workers who suffer a loss in transfers

and struggle to find work. As a result of this debate the duration of unemployment benefits for workers

aged 55 and older was increased to 24 months.

After the labour market reforms, the employment rate for workers aged 55 to 60 increased from 73.8% in

2006 to 77% in 2010. The increase was even more pronounced for workers aged 60 to 65 (from 33.2% to

44.2%) while the overall increase in the employment rate was much lower (74.9 to 76.5%) implying that

labour market reforms affected to some extent the labour market participation of older workers. The

increase was strong for both females (24.4 to 35.4%) and males aged 60 to 65 (42.3 to 53.4%), while for

males aged 55 to 60, the increase was smaller (82 to 84.4%) than for females (65.6 to 70.2%).

The figures for self‐employed workers follow a similar trend; in the period from 2006 to 2010 the number

of older self‐employed workers increased by 9% compared to a 2% increase for self‐employed workers of

all ages.

In addition, the demographic trend is steadily increasing the number of older workers. In 2006 the number

of older workers aged 55 to 65 was 9.4 million but in 2010 it has risen to 9.8 million.

The labour market conditions for older worker are slightly worse than for the average worker. In March

2011 the unemployment rate was 9.4% for older workers and 7.6% for the average worker reflecting the

fact that older workers have difficulties in finding a job having been laid off. Given this reality, the scheme

“Perspektive 50+” is designed to help older long‐term unemployed to get work




“Perspektive 50+” was launched in 2005 by the ministry of labour and social affairs (BMAS) and is now in its

third phase. During the course of the scheme it has undergone two significant changes. Firstly, the target

group shifted from older unemployed persons in general and disabled persons, to long‐term unemployed

persons only. Secondly, the project was expanded so that more than 95% of Germany’s job centres are now

participating, up from halve that number in the second phase of the scheme.

The scheme has been implemented through the formation of a large number of regional committees

“Beschäftigungspakte” which bring together key labour market actors (the federal employment agency,

social partners, the chambers of industry and commerce, the health insurance body, regional

unemployment associations, churches and other religious groups as well as welfare organizations). The

partners involved in the employment pact have to guarantee the functioning of several basic tasks, the

coordination of the pact, financial management, public relations and the maintenance of the programme

database. The size and the geographic area of the employment pact should follow the needs of the regional

labour market structure with one employment pact for every regional labour market15.

Table 17 ‐ Actors and tasks of the project

Actor Task

Job‐centre (Federal employment agency) Organisation of the pact, providing services, financial coordination, co‐

funding

Job‐centre (municipality) Organization of the pact, providing services, financial coordination, co‐

funding

Social partners

(e.g. unions, employer organisations etc.)

Supervision of the PES, employment agreements (e.g. combined wages,

integration allowances)

Chambers of industry and commerce Provision of further education

Health insurance Provision of health‐related services

Regional unemployment associations Pact member

Churches and other religious groups Pact member

Welfare organisations Services related to challenged persons

Source: Own elaboration

The tasks of each employment pact were defined in autumn 2010 with the agencies of basic social care

(e.g. job centres) and BMAS, based on the particular application of each agency. In general, the target

agreements should guarantee the achievement of the objectives according to three criteria: a defined

number of participants in programmes, the activation of a defined number of participants and the

integration of a defined number of participants into the labour market.

The objective of a defined number of participants in programmes is an input criterion. Every participant in a

programme who is the target of activation or integration measures contributes to the success of this

criterion. The activation objective is defined as an input criterion as well. The participant is counted as

activated when he or she has participated in a programme which intends to increase his or her personal

responsibility or which intends to enhanced the ability of the participant to find a job. The integration

objective, on the other hand, is an output criterion. The number of participants successfully integrated into

15 A regional labour market is defined as a geographic area with perfect labour mobility and should include more than one job centre.



the labour market as an employee or as a self‐employed worker for a period lasting at least six (continuous)

months, count towards this criterion. Depending on the above criteria, a budget for the pact is provided.

There are three financing model options for the employment pacts. One of the first two models has to be

chosen, while the third model is an add‐on and can be chosen in addition the other models. The first model

involves 500 euros per activation, 2,500 euros per integration longer than six months and 1,500 euros for

each integration less than six months. The second model involves nothing for an activation, but 5,000 euros

per integration into the labour market for more than six months and 3,000 euros for less than six months.

The third model is intended for socially deprived participants. For this specific target group, BMAS pays

1,500 euros per activation, 5,000 euros per integration for more than six months and 3,000 euros for

participation of less than six months. However, the financial resources received from the project do not

cover all of the projects expenses. The basic social care agencies are expected to use a part of their own

funds to supplement the scheme. The legal basis of this co‐funding is § 16f SGB II.

The services provided to older workers are either co‐financed by the basic social care agencies or financed

entirely by the ministry. All services provided fit into the service scheme of the federal employment agency.

From the start of the third phase of the scheme in 2010 until June 2011 the number of participants in co‐

financed services steadily increased to more than 44,000 each month. These services can be split into three

groups: services to improve chances on the labour market, job accompanying services which are foremost

employer’s integration allowances and finally, job creation schemes16. In 2008‐2009 services to improve

prospects on the labour market were most common, making up more than 50% of the other services

provided to older unemployed persons. In the aftermath of the financial crisis these services dropped to a

28% low in January 2011 but have since been rising. Since November 2010 job creation schemes have

clearly dominated and in January and February 2011 they made up over 40% of services. However, their

share is falling steadily and was 37% in June 2011, reflecting the strong recovery in Germany. Job

accompanying services, on the other hand, have remained at roughly 20% throughout the whole project

period.

Most participants receive services intended to activate and integrate older workers into the labour market

initially. These services are intended to discover skills and placement restraints in the first instance and

then to eliminate placement restraints. Most of these services are tendered to private agencies. In April

2011 nearly 9,400 older workers participating in the programme received one of these services. Within this

group of activation and integration services 2,400 older workers were placed in schemes; 1600 received

activation services like job application training and 600 received services to eliminate placement restraints.

However, if one worker receives more than one service, he or she is counted in a separate group

(containing 3,100 participants). Only 44 participants received services to help them enter self‐employment,

and 1,000 received services of further vocational training. In the group of job creation schemes, services

which pay only an expenses allowance on top of the unemployment benefit dominated ‐ with 3,400

workers participating in these schemes.

Besides the services within the programme database of the BA, 18,000 older workers receive services

covered solely by the “Perspektive 50+” scheme. These services are foremost health services, integration

16 The job creation schemes are to a large extent jobs with expenses allowances “Arbeitsgelegenheiten mit Mehraufwandsentschädigung” according to §16d SGB II. These jobs are created at the municipality level and have to be additional and socially useful. The duration of the job should be between 3 and 12 months, the goal of this service is to increase the employability of the participant.



allowance for workers who are not likely able to find a job in the next 24 months and combined wages

which cover losses (e.g. pension scheme related) which occur due to the acceptance of a low‐paid job offer.

The University Duisburg‐Essen won the tender for the evaluation of the “Perspektive 50+” scheme. The

researchers found that 18% of activated older workers were integrated into the labour market. Out of

these, the share of participants with employer’s allowances was 39%. However, the project was not

finished at the time of evaluation. If only participants who left one of the programmes are considered, the

labour market integration was 34.5%. The researchers observed huge variation in success; some of the

regional committees “Beschäftigungs Pakt” integrated 700 older workers which was more than ten times

the integration of the worst performing committees. Most of the older workers got a job in their previous

occupational sector, 20% had to choose an occupation below their formal qualification and another 20%

found an occupation better than their last job (Büttner, et al., 2009).


“Perspektive 50+” set out to integrate older long‐term unemployed persons into the job market. Roughly

one third of the target group were integrated, and thus the scheme is considered to have been a success.

Most integration took place in small and medium sized enterprises. The close connection between the

partners of the employment pact and those companies seems to have been crucial to the success of the

project. However, the financial and economic crisis reduced the efficiency of the scheme, which is reflected

by the strong increase in job creation schemes.

The specific target group of the project was older long‐term unemployed with serious placement restraints.

In most cases the last employment was more than four years ago and participants suffered serious health

problems making the placement more difficult. The interrelation between lifestyle and health problems

was a specific issue within the project. The partnership between the BA and the health insurance

companies made it possible to activate participants, giving them help in leading a healthier life.

Obstacles to mobility were a serious barrier to the success of the project. In rural areas there is a lack of

public transportation and older workers without a driving license are unable to travel to a working place in

the environs of their place of living. The project has no clear strategy for the activation of those people

since the basic living allowance barely covers the costs of a car. Furthermore, participation in driving

schools is not a quick‐fix, it can take time to pass and be able to drive confidently. The Institute for

employment and qualification also reported that knowledge of the legal framework was not up to

standards in all job centres. In some cases there could be more services provided to the target group than

are currently in place.

The provision of specific services to older long‐term unemployed is a necessity in an aging society and the

provision of services related to health issues is in most cases crucial for the activation of the target group.

Accordingly, the job‐centres face new challenges in the upcoming years. Older people face specific

problems, like obstacles to mobility; here the programmes need further development to match the needs

of older people. Additionally, new services for older people which were developed during the last years like

special forms of combined wages have to be implemented as regular services. This inter alia demands

further training of placement officers. In sum, the scheme “Perspektive 50+” is an important step towards

serving the needs of older unemployed. Nevertheless, there seems to be a way ahead till the scheme gets

obsolete and the need for new programs for older workers diminishes.



3.4 Netherlands


An ageing population is one of the top challenges faced by European economies. As the baby‐boom

generation reaches retirement there will be fewer workers for each pensioner and so, a greater strain on

funding. The Netherlands are one of the EU’s more stable economies and, for many, a model of sound

policymaking. Yet even for the Dutch the ageing issue is proving difficult to tackle. In fact, as in many EU

countries, people aged 55‐64 in the Netherlands currently represent approximately a fifth of the whole

working age population (those aged 15‐64) (Eurostat data for 2010) and their weight is projected to

increase up to 2025‐2030.

However, the Netherlands has successfully undertaken major social security and labour market reforms in

recent years, and current Dutch employment performances for older workers are significantly better than

most EU countries. Over the last 10 years or so, the Netherlands has been able to start reversing the early

retirement trend and improving employment at end of career. The basic principles of the government’s

efforts were as follows:

To make it easier and more attractive for people to stay in work longer (i.e. favouring flexible working

patterns);

To avoid a forced early shift into inactivity (via retirement, unemployment or disability schemes)

wherever possible;

To make early retirement schemes disadvantageous. Voluntary early retirement has remained an

option, but its costs are to be borne individually rather than collectively;

To encourage reintegration into the labour market.

Major reforms were initiated around 1995 and accelerated under the second Kok government (1998‐2002).

To keep the pension scheme affordable and meet the rising costs of care, the Dutch government set,

among others, the target of an annual rise of 0.75 of a percentage point in the net participation rate of

people aged 55‐64 years from 1999 onwards. More recently, in response to the crisis, the Dutch cabinet

confirmed its commitment to the goal of higher labour participation, excluding any measures aiming to

reduce labour supply as counterproductive over the longer term. As the economic crisis has caused

considerable concerns over the ageing population issue and the sustainability of the pension system, a new

set of policy initiatives has been launched since 2009:

the government announced its decision to postpone the age of the retirement from 65 to 6717;

older individual employees who continue working until the age of 65 and beyond have started to

benefit from a “longer working bonus”, while those working beyond 57 have received a higher tax

credit for working longer;

unemployed older workers who return to work have been guaranteed a wage that is higher than their

previous social benefit;

fiscal bonuses have been introduced for employers who recruit unemployed adults over 50 or who

continue to employ workers aged 62‐65; recruiting unemployed individuals over 59 is subsidized up to

the age of 6518.

17All those aged 55 or over in January 2010 retained the right to their old age pension at 65, while the change will take place in the

near future in two phases: in 2020 to 66, and in 2025 to 67. 18In cases where individuals become sick, the government compensates the employer for the costs involved.



Unlike the majority of the EU Member States, the Netherlands has put a stronger emphasis on training and

labour supply measures within anti‐crisis measures. In 2009 the original focus on the structural non‐

participation of older workers has been increasingly broadened towards an integral policy perspective on

sustainable employability throughout the individual life course. In particular, in December 2009, the

Ministry of Social Affairs and Employment submitted a policy memorandum on Labour Market Participation

of Older Workers to the Dutch parliament. This memorandum announced that the cabinet wished to create

a climate for investing in the productivity, employability and mobility of workers so that they can utilise

their talents and possibilities also in later life. Three key areas for policy development are identified:

education and training, age‐awareness personnel strategies in companies, and the development of

instruments for preventive interventions.

As a result of the mentioned policy changes, the employment rate of 55‐64 year‐old Dutch workers

increased from 28.8% in 1995 to 53.7% in 2010 (64.5% for men and 42.8% for women) and the average exit

age from the labour force rose from around 60 in 1995 to 63.5 in 2009 (Eurostat), the second highest in

Europe after Sweden (64.3 years)19. Also, throughout the economic crisis, the Netherlands has been cited

among countries where the impact on employment and unemployment rates has been relatively mild. Over

the crisis period the employment rate of people aged 55‐64 for the EU‐27 as a whole continued to increase

but Dutch older workers performed better than average. In spite of this, the employment of senior workers

still represents a significant problem. In 2010 there were 122,000 registered non‐employed jobseekers

aged 55‐64, representing more than 20% of all registered non‐employed jobseekers (up from about 15% in

2001), while in the same year their share in all PES vacancy placements was just 2‐3%. Moreover, as is the

case across Europe, problems for older workers arise once they become unemployed or inactive. The

average duration of unemployment for people over 55 is 3 years. To the same extent, the probability that a

55‐year‐old jobseeker on unemployment benefit re‐enters work one year later is 10%, reduced to 3% for a

person aged over 6020.


The Dutch PES (Uitvoeringsinstituutvoor Werknemersverzekeringen, UWV) strategy towards older workers

is based on the following pillars:

1. Continuing to break down prejudices towards older workers;

2. Encouraging face‐to‐face meetings between elderly unemployed and employers;

3. Developing network groups at local offices to support employability of older workers;

4. Encouraging mobility within and outside organizations;

5. Focusing more on talent and less on age;

6. Using more skills assessment systems, with special assessment for people aged 55+ and

long‐term unemployed;

7. More use of EVC and EVP (certificates of acquired skills and competences);

8. Encouraging use of social media also among senior workers;

9. Cooperating with private partners.

UWV has been playing a proactive role in countering the effects of the economic crisis on older workers. In

order to maintain work. During the crisis UWV implemented the “Mobility Centres (job‐to‐job)” project that

19 Also not policy driven spontaneous factors are at play, such as: the rather recent increase in female participation that now reaches the higher age groups and the increased level of educational attainment (higher level correlates with higher participation ratio’s) 20Source: http://www.wapes.org/infos/file/attachfiles/pdf/2011‐136‐EN.pdf ‐



intended to provide jobs to redundant workers before they became unemployed. This initiative had 31,000

placements overall, of which 60% were for people aged 45 years or more. After the crisis the project ended

but the service has been implemented as part of the regular UWV service offer.

The UWV has initiated two programmes that focus on older workers as main target21. The first project was

called “Talent 45+” and it aimed to promote the labour market participation of jobseekers aged 45‐63.

“Talent 45+” started in January 2007 and ended in 2010. The budget of the project was 9 million euros and

it was funded by the Ministry of Social Affairs and Employment (SZW). UWV acted as the main responsible

organisation, but several actors were involved in the realisation of the project: temporary agencies,

municipalities, employers as well as trade unions. In 2010, the project managed to support more than

75,000 people aged 45 and more back into work (up from 68,000 in 2007). In addition, over the four year

period of implementation about 286,000 unemployed people 45+ were supported back to business (against

a planned target of about 168,000 people).

The second more recent project is called “ESF Talent 55+”, which aims to promote labour participation of

jobseekers aged 55‐60, mainly bringing older unemployed people into contact with each other, so that they

can use each other’s networks to find work. The project was set up at the beginning of 2009 and

commenced activities in October 2010. It has a total budget of 2.2 million euros, of which 40% is funded by

the ESF and the remaining share directly by UWV. For this project UWV Werkbedrijf has trained 26

dedicated coaches whose main activity is to keep the unemployed 55+ workers fit for the labour market

and to find a job by using each other’s network. People meet at a job centre and discuss various topics. The

job centre acts as a facilitator (they can use job‐centre rooms, meeting facilities, computers, coffee, etc.).

The result is that 18% of the participants found work within 10 weeks. The others form a new network

group with the new influx of participants.

As far as the working method is concerned, dedicated work coaches organise these network activities for a

13‐week period; principally these activities focus on:

how to present oneself, including so‐called “elevator pitch”, that is to produce a quick, succinct but

convincing statement of personal skills, talents and ambitions;

how to use social media;

how to draw up a good CV and how to write an application letter;

how to deal with a job interview;

how to look for suitable jobs or even start a business.

Beside these 55+ network groups, the following services are also offered by the project:

swot‐analysis of personal skills to plan how to approach the labour market efficiently;

use of competence tests and earlier acquired skills certificate, to test also people’s motivation;

labour market reintegration instruments (i.e. subsidies for employers to encourage them to hire older

people – subsidies are up to 6,500 euros per year, for a maximum of three years)22;

targeted canvassing of employers, through which UWV approaches employers that may have special

vacancies for elderly workers;

research and utilisation of available subsidy opportunities;

organisation of specific job fairs and speed dating.

21 Disabled people are also eligible to take part in the project.

22 Although no budget for reintegration instruments has been allocated for the year 2012.



The project has a particular approach towards participants, since they are categorised according to their

level of education in order to provide tailored measures for both the lower and the higher educated.

Providing a more specific and specialised service for each participant means obtaining better results, as it

deals with personal skills and attitudes.

The project aims also at promoting a positive self‐image of senior jobseekers and changing the negative

image that employers have of them (in particular supporting a focus on talent rather than old age). This

occurs mainly through a nationwide advertising campaign and a series of meetings and workshops between

employers who offer vacancies and the target group. So, the exchange of information is favoured, in order

to improve the matching between demand and supply in the labour market.

Twelve months from the start of the project, the results of the “ESF Talent 55+” project are as follows :

3,978 older unemployed 55+ workers have taken part in the network groups, 1,364 have found a job and

85 started their own businesses. Thus, more than 33 % of the over 55s involved in the project have found a

job23, compared to a success rate of 10% for “normal” UWV services24. In the future, UWV intends to

involve a total of 10,000 older workers in the project.


The “ESF Talent 55+” project has so far had significant results, since approximately one in three jobseekers

found a job within six months. A key aspect of the project is the provision of specialised work coaches who

help jobseekers from each specific target group to improve their skills. Work coaches who really like to

work with the older worker target group are a crucial factor for the success of the “ESF Talent 55+” project.

Indeed, given the positive results achieved, it has been decided to expand the number of coaches from the

initial 26 to 55 and up to 180 for the following years.

Other important elements for the success of both projects (“Talent 45+” and “ESF Talent 55+”) are:

the cooperation and action of all parties involved both on the labour supply and labour demand sides

(temporary agencies, municipalities, employers as well as trade unions).

the involvement of employers: the labour market demand side needs to be stimulated. One example is

the organisation of campaigns for employers to tackle the prejudices they held towards elderly

jobseekers (i.e. lack of flexibility, regular sickness, etc.). While participating in workshops/job fairs,

where role models and best practices are presented, employers might convince each other to hire

senior persons.

the offer of special programmes targeting senior jobseekers who are willing to start their own

businesses (i.e. special competences tests, workshops, etc.).

adequate support from policy makers.

an adequate budget and a booming economy is certainly is helpful.

23 More than 30% of the total found a job within 6 months. 24 For 2011 UWV targets for older workers to achieve through normal services are:

Offer 5,720 sustainable jobs to older jobseekers;

500 jobseekers to find paid employment;

and 30 jobseekers to become self‐employed.



3.5 Poland

The Polish experience focuses on the “Mature Entrepreneur” project implemented between 2009 and

2010.


Senior workers aged over 50 in Poland are in a very particular situation in the labour market. According to

the Central Statistical Office, in 2009 and 2010, they made up about 40% of the whole working age

population. They also have the lowest activity rate within the EU‐27 area (except for Malta), currently

around 32% (2010) with an extremely low employment rate among women (24.4%) and 41% among men,

but, at the same time, the unemployment rate is very low: 6.3%. This may be due to the fact that they de‐

activate early and are often not registered with the PES as unemployed.

In 1990, with the economic transition and the reduction in the number of jobs in large‐scale production

companies, workers over 50 were incentivised to use early retirement benefits, based on specific bridging,

early retirement schemes. In mid 2000, the average retirement age in Poland was 57.9 for men and 56 for

women.

Subsequent governments, instead of developing and establishing a set of retraining programmes for people

over 50 to match their qualifications with the needs of the contemporary labour market, sustained and

stabilised this practice of early deactivation. This resulted in the transfer of about 30% of early pensioners

aged over 50 to the grey economy (Mol, 2008). Some research also confirmed that people aged 50 or over

in many cases apply “a strategy of inactivity” and obtaining a benefit (early retirement, pension, or

disability benefit) is socially perceived as a “labour market success”. Such attitudes in the labour market

towards the older workers were reinforced by: legal settings and incentives, early work burnout due to lack

of age management policy in companies they worked for during their working life (especially during

Communism), deteriorating health conditions, and low financial means (Academy for Philanthropy

Development, 2007). On the other hand, when, in 2009, the Central Statistical Office asked people aged 50

or over if they wanted to deactivate early, one third stated that they wanted to work as long as possible.

In many surveys (Academy for Philanthropy Development, 2007; Manpower, 2009; Kozubska, 2008)

employers declare that age is not a relevant factor when choosing a new employee. However, older

workers and labour market institutions have in practive observed some degree of age discrimination in the

labour market.

In relation to the national policy context in Poland, it is worthwhile mentioning that when it comes to

dealing with senior workers (50+), all undertakings and actions mirror the Polish PES business model which

means administrative decentralisation of competences and activities into regional (NUTS 2) and very local

levels (NUTS 3). This means that there is nearly no legal space for national coordination of any day‐to‐day

businesses and practices as they are mainly conducted by regional and local labour offices who are

financially dependent on local governments. The Ministry of Labour and Social Policy can facilitate and

enhance initiatives and actions addressed to any group in the labour market by special ministerial

programmes. In the case of senior workers in Poland the programme Solidarity of generations, Actions to

increase employment activity of 50+ was conducted from 2008 to 2010. The instruments of such

programmes are mainly related to legal developments: new acts and regulations and special budgetary

lines for regional and local initiatives. In the case of the programme Solidarity of generations nine legislative

tasks were completed, in relation to: releasing employers from special payments to Work Fund and Fund of



Guaranteed Workers’ Benefits when employing 50+; facilitating training to upgrade skills for 50+; limiting

the number of special occupational groups authorised to access early retirements schemes; creating legal

conditions for grandparents to be able to take care of their grandchildren without stopping their

occupational lives (life‐wide learning). The programme created also innovative initiatives addressed to 50+

such as E‐learning for 50+ and Skill Centre 50+ within life‐long learning process. The programme Solidarity

of generations was cross‐public administration programme in a sense that the Ministry of Labour and Social

Policy invited other ministries to actively participate: ministries of education, health, regional policy,

agriculture, and governmental agencies of human resourses development and enterprise development but

also local governments and regional and local labour offices.


The local PES in Gdansk (North of Poland) conducted a project called “Mature Entrepreneur” from 1st

January 2009 to 31st December 2010. The basic aim of the programme was to prepare (via advanced,

detailed training and individual coaching) a selected group of people over 50 to run their own business for a

minimum period of 12 months, with the help of the subsidy given by the labour office. The project had four

phases: (1) an information campaign to enhance recruitment and selection processes; (2) advanced training

and coaching (counselling) for some selected older workers; (3) the setting up of business plans prepared as

a result of training and counselling and subsidising selected business plans; (4) the monitoring of the

implementation of business plans, and further coaching and monitoring the survival of the business in the

market.

The project was addressed to senior workers aged 50‐64, divided in three labour market groups in the

Poviat of Gdansk (NUTS 3): (1) unemployed senior workers aged 50 or over registered with local PES

(target: 20 people); (2) inactive older workers never registered with PES (target 20 people); (3) employed

and active senior workers wanting to change something in their occupational lives (target 20 people). One

of the most effective novelties of this project was a number of media campaigns (newspapers, TV, internet)

in order to enhance the recruitment processes/channels. They were addressed to those beyond the reach

of PES, to passive older workers, to those not registered with labour offices and also (but to a lesser extent)

those who wanted to change the course of their working lives. The campaign brought 120 people ‘from the

street’ into the programme, as well as people, aged 50 or over, who were already registered with local

labour offices at the time of the project. In the end, 60 people were selected in the three above mentioned

categories.

The principal provider of the project was the local labour office in Gdansk. The partners of the programme

were: Gdansk Employers Associations (Gdanski Zwiazek Pracodawcow); the Regional Chamber of

Commerce of Pomerania (Regionalna Izaba Gospodarcza Pomorza); the Pomeranian Chamber of Craft of

Small and Medium Enterprises (Pomorska Izba Rzemieslnicza Malych i Srednich Przedsiebiorstw). The local

TV station was playing a contractor role, rather than being a partner of the programme. Partners of the

programme were acting as experts in advising local PES on the selection procedures, and on drawing up

business plans eligible for start‐up subsidies.

“Mature Entrepreneur” was funded by the European Social Fund along with minor input from the Labour

Fund of the Minister of Labour and Social Policy, with a total budget of just under 2 million PLN (around 0.5

million euro). The budget involved categories of: (1) information and promotion campaign (mostly based on

contracts with local national TV stations); (2) an advanced entrepreneurship group training, called ‘ABC of

business’, for 60 people; training measures were conducted by external specialists and individual coaching

(in the homes of the participants) with the main aim of preparing business plans for further competition in



the next stage of the programme25; (3) a 10,000 euro subsidy for all the 26 winners of the business plan

competition26; (4) extra bridging money for 13 beneficiaries (in a salary form) of 1,200 PLN (300 euro).

The project has not been systematically evaluated ex‐post. The only means of evaluation was an on‐going

monitoring of: (1) the carrying out of business plan obligations such as: the purchase of the declared

equipment, all the necessary investments in properties or of further training measures and (2) a survival of

subsidised activities over a twelve month period. In conclusion, all subsidised activities lasted for at least

twelve months and fulfilled the obligations declared in the business plans.


Main results and challenges emerging from the project can be summarized as follows:

An open recruitment process with the support of TV campaigns attracted people who were passive in

the labour market or otherwise unreachable, as they had never registered as unemployed at labour

offices or had other financial resources such as: a pension or disability benefits or a working partner

(either in Poland or abroad) or supplied their services in a grey segment of the economy. The project

counteracted the “strategy of passiveness on purpose” and helped the over fifties in the labour market

to “come out of the shadow economy”. TV campaigns and other programmes documenting the work of

beneficiaries not only helped to promote economic activity among senior workers, but also helped to

break some of the negative stereotypes about the impossibility of this group to change their lives (“that

it is not too late, it is never too late”27). Some TV programmes were also a kind of “public surveillance”,

public monitoring of public money and helped to enhance the responsibility among society members.

The project gave also an opportunity to those already employed but not satisfied with their current

jobs (“stuck in the same jobs for ages”) or to those who found themselves in deteriorating conditions,

either as a result of further restructuring of the Polish industry or as a result of the economic crisis.

Addressing the project to “an open audience” of older workers brought the labour office a clientele

with a much higher and richer human capital, with better prospects for being reintegrated into the

labour market long‐term.

The size of the financial subsidy determines the size of the company to be set up by older workers.

Small subsidies usually bring single‐person companies (micro company). Therefore PES cannot expect a

big increase in employment.

The lack of a systematic evaluation of the project is a serious disadvantage. It will certainly limit the

learning process.

25 As declared by PES coordinator of the project and in project participant interviews, training and individual counselling were far more advanced, detailed, and better prepared than those offered by PES in a standard form. 26 Beneficiaries commenced their business activities in few categories, usually filling the niches in the market for “petty services” that big companies have no financial interest in supplying: (1) standard construction services such as: advanced energy auditing, house maintenance via small handy‐man type works; (2) financial services based on the financial education of clients; (3) psychological support centre for children and teenagers; (4) tourist services such as Internet Bureau of Tourist Information; (5) artistic services: puppet theatre; glass studio; (5) cosmetic services with tranquility therapy in a garden; (6) mechanical services such as car mechanic surveying on the spot; ecological car wash; (7) innovative services such as surveying the quality of water (thermo diagnosis, thermo vision). 27 A subsidy recipient said in an in‐depth interview that even if she did not receive the subsidy, after all this advanced training and individual coaching, she would set up her own business.



3.6 Overview of employment subsidies in favour of older workers around Europe

This section focuses on the provision of employment subsidies that aim to incentivise the recruitment of

older workers or to maintain their jobs. In subsidized employment the earnings are provided by an

employer who receives a subsidy for the creation and maintenance of the employment position. Although

employment subsidies and passive labour market tools are beyond the scope of this study, given their

relevance in Europe, they must be mentioned briefly. The frequency with which employment subsidies are

used in the EU suggests that EU policy makers acknowledge that labour market demand plays a relevant

role in the issue of older workers. The table below summarizes the main employment subsidies targeting

exclusively the over 50s, across Europe. 7 EU countries have employment subsidies specifically for senior

workers.

Table 18 ‐ Employment subsidies exclusively for the over 50s, selected EU Member States, 2009

Country Intervention name Eligibility Type of subsidy Planned

duration

Year of

start

BE Back‐to‐work bonus for

people aged 50+ (FED)

Registered unemployed

50+ with at least 20 years

of work and eligible to UB.

Additional income paid to

workers going back to work.

12 months

(typical)

2002

Back‐to‐work bonus 50+

(FR)

Registered jobseekers

50+.

Wage subsidy paid to employers

(up to 12,000 euro per year) in

the Flemish region.

1 year

(max)

2006

BG Incentives for employers

to hire older unemployed

Old registered

unemployed (women 50+

and men 55+).

Incentives for employers:

contribution to wages, social

contributions, annual leave pay.

1 year

(max)

2002

Support in retirement


having <5 years to reach

the legal retirement age.


contribution to wages, social

contributions, annual leave pay.

12 months

(typical)

2003

DK Servicejobs

Recipients of UB aged 49+

and in unemployment for

6 months.


annual contribution to the total

salary of old LTU.

:

1999

Seniorjob


55+ and having worked at

least 25 years in the last

30 years.

Incentives for municipalities:

periodic cash payments.

10 years

(max)

2009

DE Wage protection for older

employees

Unemployed aged 49+.

Incentives for employees: wage

subsidy plus supplementary

contributions to the old‐age

pension insurance.

2 years

(max)

2003

Integration voucher Unemployed aged over

50.

Integration voucher paid to

employers.

1 year

(max)

2008

AT Bonus/malus system

within the scope of

unemployment insurance

Unemployed over 50 +

employees over 50 with at

least 10 years in the same

enterprise.

Exemption of employers'


contributions.

Not

defined

1996

RO Subsidies for unemployed

approaching pension age

Unemployed having <3

years to reach the

retirement age.

Employers receive a monthly

subsidy equivalent to the

minimum wage.

3 years

(max)

2004

SI Promotion of

employment for older

unemployed persons

Unemployed aged 50+. Lump‐sum subsidy paid to

employers.

1 year

(max)

2008

Source: Eurostat, Labour Market Policy (LMP) database, data extracted on 28/07/2011



The next table looks at the employment subsidies targeting also people over 50. Matching the information

in the two tables it becomes clear that 20 EU countries had in 2009 wage/employment subsidies to support

senior workers’ employment.

Table 19 ‐ Employment subsidies targeting also the over 50s, selected EU Member States, 2009


duration

Year of

start

BE Transition‐to‐work

subsidy (BCR)

Low‐qualified jobseekers

(incl. unemployed 45+).

Monthly grant (up to 500

euro) paid to employers.

12 months

(typical)

1994

Activa (FED)

Registered jobseekers

(incl. unemployed 45+).

Reduced social contributions

for employers + monthly

allowance for employees.

63 months

(max)

2002

Insertion enterprises

(FR)

Disadvantaged

jobseekers (incl. 50+ in

inactivity for at least 6

months).

Degressive wage subsidies for

employers.

2 years

(max)

1999

DK Practical work training in

enterprises

Hard‐to‐place

unemployed (incl.

unemployed 60+).

Periodic cash payments to

individuals.

26 weeks

(max)

1994

DE Integration subsidies Unemployed facing

difficulty to find a job

(incl. those aged over

50).

Wage cost subsidies for

employers.

3 years

(max)

1998

EE Wage subsidy Registered unemployed

considered as risk

groups (incl. persons

having <5 years to reach

the pension age).

Wage subsidy for employers

(first 6 months: minimum

income; last 6 months: half of

the minimum income).

1 year

(max)

1995

ES Incentives for open

ended employment

contracts

Specific categories of

unemployed (incl. those

aged over 45 registered

as jobseekers for 12

months in the last 18

months).

Reductions of social security

contributions for employers.

2 years

(typical)

1997

Incentives for open

ended employment

contracts (measure ES‐

11 regions)

Specific categories of



as jobseekers for 12

months in the last 18

months).



2 years

(typical)

1997

Employment support Priority groups (incl.

workers aged over 60).



: 2005

Employment support

(measure ES‐59 regions)

Priority groups (incl.

workers aged over 60).



: 2005

FR Employment‐initiative

contract (CIE)

LTU and other priority

groups (incl. jobseekers

aged over 50).


monthly subsidy + reduction

of social contributions.

2 years

(max)

1995

Professionalisation

contract

Jobseekers (incl. those

aged 45+).


exemption of social security

contributions (up to the

minimum income level) +

lump‐sum payments.

2 years

(max)

2004

Employment‐initiative

contract

LTU and other priority

groups (incl. jobseekers

Monthly grant paid to

employers.

2 years

(max)

2005




duration

Year of

start

(CIE‐PCS) aged over 50).

CY Promotion of flexible

forms of employment

Unemployed women


50).


50% of the labour cost (salary

+ social contributions). The

unemployed also receive

some money to cover

travelling expenses.

1 year

(max)

2007

LV Subsidised employment

for unemployed


(incl. those having <5

years to reach the state

pension age).


monthly subsidy (up to 50%

of the minimum wage)+

lump‐sum payments (to

adjust the work place for

disabled people).

2 years

(max)

2007

Measure for special

target groups


(incl. those over 50).


monthly wage subsidy (for

the unemployed and the

mentor) + lump‐sum amount

for the purchase of

equipment.

2 years

(max)

2008

LT Support of social

enterprises

Inactive people (incl.

pre‐pension aged

people).


partial compensation for

wage fund contributions and

social insurance premiums,

earmarked subsidies for the

establishment of a work place

or its adaptation to a disabled

person; subsidies to train

employees belonging to the

target groups.

Not

defined

2004

Subsidised employment Registered unemployed

(incl. persons over 50

capable of work).

Monthly wage subsidy for

employers (up to the

minimum income level).

12 months

(typical)

2006

LU Aid for employing long‐

term and older

unemployed


(incl. those aged 45+).

Reimbursement of

employers’ social

contributions.

2 years

(typical)

1993

HU Start extra LTU (incl. those over 50). Reduced social contributions

for employers (1st year: total

exemption; 2nd year: the

contribution is 10% of the

gross salary).

2 years

(max)

:

MT Gozo employment aid

programme

Unemployed in Gozo


50).

A lump‐sum subsidy

equivalent to half the wage

and half the National

Insurance is given to

employers.

One‐off 2007

Employment aid scheme Unemployed (incl. those

aged over 50).

Employers receive a grant

equivalent to 50% of the

wage costs.

26 weeks

(typical)

2009

AT Integration subsidy (EB) Specific categories of


aged over 50).

Wage‐cost subsidies for

employers.

3 years

(max)

1994

PL Interventional jobs Registered unemployed



partial reimbursements of the

wage costs, bonuses and

4 years

(max)

1990




duration

Year of

start

social insurance

contributions.

Work practice Registered unemployed


Allowance provided to

employees (120% of UB).

1 year

(max)

2009

PT Subsidies for permanent

employment contracts

Young unemployed +

unemployed aged over

45.

Enterprises with over 50

employees receive a non‐

refundable lump‐sum subsidy

(up to 12 times the minimum

wage).

4 years

(max)

1995

Recruitment incentives

(Madeira)


(incl. those aged 45+).

Permanent contracts:

employers receive a lump‐

sum subsidy for each job

created.

Fixed‐term contracts:

employers receive a monthly

subsidy covering the wages

equivalent to 40% (1st year)

and 30% (2nd year) of the

minimum income in Madeira.

2 years

(max)

2009

RO Subsidies for employers

taking on registered

unemployed


(aged over 45 or unique

"bread earner").

Employers receive subsidies

granted from the


fund.

2 years

(max)

2002

SI Reimbursement of

employers contributions

(Article 48a)

Unemployed (incl. those


at the PES for at least 12

months).

Reimbursements of

employers' contributions.

15 months

(max)

1999

Promotion of

employment for hard to

place unemployed

persons/Employ.me

Unemployed (incl. those

over 50).

Lump‐sum subsidy paid to

employers.

1 year

(max)

2009

SK Contribution for

employing a

disadvantaged job

seeker

Disadvantaged

jobseekers registered at

the PES for at least 3

months (incl. those over

50).

Wage cost subsidy. 2 years

(typical)

2004

FI Employment subsidy,

private companies

Unemployed (incl. older

people).

Subsidy paid to employers

(which can cover the gross

wage, employer's statutory

social security contributions,

employee pension insurance,

accident insurance,

unemployment insurance and

group life assurance

payments).

3 years

(max)

1979

Source: Eurostat, Labour Market Policy (LMP) database, data extracted on 28/07/2011.



3.7Main findings from the case studies on PES experience

This section summarises the main types of intervention promoted by PES for supporting older workers and

older job seekers in the case studies. It also takes advantage of a very recent study produced by DG

Employment (Hake, 2011), which provides an interesting review of PES experiences with older workers.

The lessons arising from the case studies can be aggregated in three main groups.

How to deal with the specificity of older workers – Older workers are a particularly complex target group

with multidimensional issues that hamper their participation in the labour market. In comparison to other

groups, older workers have a shorter career in front of them and have to deal with more frequent personal

and social problems related to their age. This makes it more difficult to involve them in ALMP and means

that customised services are required. The case studies suggest some solutions:

The utilisation of psychological support together with more traditional labour market and activation

measures is often useful;

Empowerment of older workers is an important component of their successful activation. Networking

and exchanges between older workers/job‐seekers can help to raise self‐esteem and motivation. In

some cases advice and guidance on health issues can help them gain a better perception of their own

capability;

Individualised services are needed to tailor the assistance offered to older workers. It is essential to

consider older workers as a specific target group that needs an individualised approach integrated with

specialised services. The latter two elements are not mutually exclusive and together help to make the

interventions more effective.

How to support the employability of older workers – Lower productivity, lower capacity to adapt to new

technologies or work re‐organisation and higher costs are the most common reasons for discriminating

against older workers. The chances of maintaining or renewing employability are seriously hampered when

these factors are associated with low or obsolete skills and a reluctance to participate in training activities.

PES have tried to deal with this issue by adopting the following:

The implementation of more innovative learning activities, such as coaching or training on the job can

increase the chances of actively involving older workers and produce outcomes that are more rapidly

transferable to the labour market;

competence certification and valorisation of informal competences, often accumulated by older

workers, are important instruments to reinforce interest in learning activities and support the

employability of older workers;

promotion of self‐employment and work with intergenerational links (i.e. services for younger people

or tutoring), where informal competences and experience can be exploited better and the social

relevance of the work is more easily perceived;

working time flexibility (i.e. part time, labour sharing) and direct subsidies can facilitate employability,

limit discrimination and solve more complex individual cases.

How to generate a favourable environment for older workers – the participation of older workers in the

labour market requires ageing strategies at national and local and enterprise levels. In many cases a real



“cultural” change is needed to overcome prejudices both in labour demand and supply and to identify

different local solutions. To these aims the examined cases propose:

the development of partnerships involving, as well as PES, entrepreneurial associations, providers of

other fundamental services (health, family care, social assistance, etc.) and local institutions. This

approach is particularly relevant in territories dominated by SMEs, which do not have the capacity to

independently develop ageing strategies or make organisational adjustments and are often less inclined

to get involved in ALMP. Partnerships can increase the awareness of the ageing issue among the

different actors, favour their collaboration and coordination, and promote the definition of a local

policy.

Communication on the issue of including ageing and older workers in the labour market is often a

powerful tool that stimulates actors to intervene and activate older workers. Communication can

include advertising campaigns as well as the development of specific IT tools.

The implementation of these interventions requires particular skills within the PES in order to promote the

right services and activate targeted initiatives. There is still relatively little experience among the PES

related to older workers and the creation of working groups or dedicated teams can be useful to cumulate

and exchange knowledge. Capacity building within the PES has to systematically accompany the

development of direct services along the three lines described above.



4. Conclusion and policy considerations

The analysis of key trends in the European labour market provided some indications as to the

characteristics and the scale of problems confronting older workers; while the case studies offered some

important examples of active services and measures being implemented by PES to support the

employability of older workers. The main findings have already been summarised in the closing paragraphs

of each of the preceding sections, consequently this section intends to use those findings to feed the

European strategy and propose some orientation to the PES strategy for increasing labour participation as

well as the employability of older workers following the approach of their own recent strategic indications

(PES Working Group 2020: making the employment Guidelines operational).

Some strategic considerations

The employment of older people is a strategic challenge for the EU and its relevance will increase in the

near future. Widespread budget consolidation and an ageing population require a balanced

intergenerational distribution of the fiscal burden and of occupational opportunities. This requires a flexible

labour market with a reduced segmentation by age. Europe 2020 and the related Employment Guidelines 7

and 8 recognise this issue and propose a comprehensive approach, based on the principles of flexicurity, to

the regulation of the labour market and the implementation of preventive measures.

A low employment rate amongst older workers is a structural feature of many European countries and is

generally associated with a low employment rate for the overall population. In other words, older workers

do not displace other categories of workers (i.e. young people), but on the contrary suffer from rigidities

and discriminations just like other groups. This means also that specific and stringent policies on their own

cannot change this situation in the short term. Only the coordination of active and passive measures

coupled with reforms of labour markets and of pension and benefit systems can lead to a progressive

solution of this problem, as recent trends have confirmed.

The size of the problem is highlighted by the fact that the EU employment rate of people aged 55‐64 is over

30% lower than that of the prime working age. In addition, with few notable exceptions, EU countries are

mostly still some way from the employment rate target set within the Europe 2020 strategy (75% for those

aged 20‐64 by 2020). Older workers are one of the main components of the potential labour force that can

make an important contribution to achieve that objective.

In spite of the resiliency of older workers during the economic downturn, when employment rates for those

aged 55‐64 continued to rise, problems arise for older workers when they become unemployed or exit the

labour market. Furthermore, a very limited share of inactive older people is actually seeking employment

and is willing to work. These elements highlight the particular weakness of older workers in the labour

market and the need for specific strategies to prevent their long term unemployment and increase their

participation. In this respect the specificity of the older workers issue emerges quite clearly.

In conclusion, a reinforced policy for older workers is urgent in those countries where their participation is

low, but also where the problem is currently less severe as macro‐economics and an ageing population may

require adjustments in the future. Policies for older workers have to be coherent with the overall regulation

of national labour markets, integrate active and passive measures and avoid new segmentation, otherwise

they would only reiterate the imbalances produced by early retirement schemes in the past. At the same

time, policies for older workers have their own specificities in terms of strategy and measures, because the

particular features of this population group demand tailor made solutions. The capacity of joining together



a well‐balanced flexicurity regime based on intergenerational equality and a specific strategy for older

workers is a key to success. The European Employment Strategy provides a coherent and broad strategic

framework to build on national policies. It is essential that Member States pay adequate attention to the

older workers issue in this process and pave the way for long term social and economic adaptation.

National ageing strategies should find adequate space in the National Reform Programmes, according to

the principles of the European Employment Guideline 7 and 8.

The role of PES in the policy for older workers

The study underlines several times that in all EU Member States PES play a fundamental role in the above

mentioned economic and social adaptation path. Competences in terms of labour policy and continuous

interaction with job‐seekers, employees and employers put PES at the centre of the policy arena for

implementing activation and preventive measures for older workers.

Data show that for older unemployed or inactive people PES remain one of the main job search methods,

but its relevance has progressively diminished in recent years. This might be caused either by a decreasing

focus of PES on older workers or by the fact that older people believe the services offered by PES are not

appropriate to their needs. Consequently, specific services, or adjustment of existing services, for older

workers is needed in many PES. The analysis of the case studies highlighted practical examples of how PES

can deal with the challenge of an ageing labour market and older workers. Here, these lessons are

organised according the strategic indications produced by the PES Working Group 2020 in order to suggest

to the PES some operational orientations related to their current priorities.

The PES Working Group identified priorities for implementing employment Guideline 7 (Increasing labour

market participation), Guideline 8 (Developing a skilled workforce) and the key leverages to implement the

priorities for action; a commitment to increase participation in the labour market of the older workers

affect all these three dimensions.

PES priorities for Employment Guideline 7: Increasing labour market participation

Priority target groups – PES recognise the need to focus efforts on those most in need whilst at the same

time maintaining a quality service for the whole range of different clients. From the findings of the study it

is clear that older workers represent an important target group; although the extent to which older worker

are disadvantaged in the market varies between countries there are common difficulties in terms of

entering or re‐entering the labour market and, in some cases staying there. At the same time, older

workers have rather specific needs related to their age and position in society. The difficulties in motivating

older workers to participate in regular ALMP measures means that it is necessary to provide more focused

interventions and to treat them as a specific target group, as well as to avoid unintentional creaming

effects. In this sense, and as mentioned above, a stronger commitment of Member States to build an

ageing strategy would help PES.

Strengthening active and preventive measures at an early stage – Preventive actions to maintain and

strengthen the employability of older workers are fundamental, in order to reduce the social and additional

financial costs of curative action. In this respect case studies show that complementary measures such as

empowerment and general psychological support are fundamental in keeping active older workers in the

labour market and should be used more often in association with more traditional interventions.



The study has also underlined how these interventions cannot be implemented in the same way as the

interventions for other target groups; the limited return on the investment in human capital for older

workers and the higher social and personal constraints often limit their participation in ALMP. To overcome

these obstacles some of the measures

covered in the case studies demonstrate

experimentation with new methods, such as

coaching, intergenerational cooperation,

and networking with peers. More generally,

the study highlights the need for a

progressive policy mix that shifts from more

traditional or standard services to more

specialised services for older workers in

relation to age. The figure depicts this

process with no ambition of modelling it;

although the relationship seems universal,

the right policy mix has to be defined case

by case in relation to the size and the features of the older worker population and the other contextual

factors (labour demand, available resources in PES, etc.).

Other factors that can positively impact on the employability of older workers are the appropriate

contractual arrangements for these workers (part‐time, job sharing, etc.) and the availability of social

services able to support personal concerns in the families of older workers. These factors do not directly

depend on PES, but PES are required to use all existing opportunities in this respect.

Strengthening personalised services – The previous considerations imply that a personalised approach to

older workers is needed; the various issues that affect older workers present in different combinations for

each individual so that profiling and individually tailored services are necessary. Unfortunately, older

people are generally not as at ease with IT tools and modern communications technology as younger age‐

groups, but specific IT assisted paths for the older generation could be defined within the regular IT tool‐set

of PES without large additional costs.

Further development of services and incentives for employers – Interventions within firms are essential to

avoid the skills of older workers becoming obsolete, to create awareness of the needs of older workers in

relation to the organisation of work and to promote an appropriate management strategy to deal with

ageing issues. This kind of intervention is probably the weakest in terms of existing PES experience, but it is

crucial to support older workers in enterprises and especially in SMEs, which often lack dedicated human

resource managers. Agreements and partnerships with entrepreneurial associations could help to develop

operational models suitable for employers needs and behaviour. In this respect competence certification

and valorisation of informal competences could help make older workers more employable, especially if

working patterns can be adapted to suit their capacity.



PES priorities for Guideline 8: Developing a skilled workforce

Incentives for lifelong learning – Older workers are at the greatest risk of their skills becoming obsolete

and out of touch with technological change so for them, more than for any other target group, lifelong

learning (LLL) is a fundamental instrument of anticipation and activation. The involvement of older workers

in in‐house training to maintain and update their skills, and their involvement in learning activities

organised in the local area should be supported as far as possible. In doing so, steps need to be taken to

develop training and complementary services in a way that addresses the resistance of some older workers

to participating in human capital investment (too late to learn something new). At the same time, older

workers do not only need training, their experience can also be valuable in training others and it is

important to recognise and make the most of their potential contribution in the role of tutor and trainer for

younger workers.

Promotion of self‐employment – Self‐employment can be an important form of employment for older

workers and a way to exploit informal competences cumulated through the past experience of work. Some

of the case studies showed self‐employment to be effective in facilitating a return to work for older people,

especially when associated with work that at the same time benefits younger people (for instance, child‐

care, transmission of handicraft skills, support to the inclusion of young workers in firms).

Key leverages to implement the priorities for action

The emergence of ageing as a strategic and long term issue requiring active intervention means that older

workers can no longer be set aside through early retirement schemes and instead the PES are being obliged

to confront the demands of what is effectively a new client group with very particular needs. At the same

time, the budget restrictions being imposed in most countries restrict the extent to which staff resources

can be expanded or even diverted to offer new specialised services . In this context, fostering partnership

between PES and other service providers would appear to be a basic and necessary step in order to broaden

the range of services available to suit the needs of older workers. Indeed, a recent study of the European

Job Mobility Laboratory (Partnerships among Employment Services, 2011) showed that this kind of

partnership can be developed on the basis of relatively limited financial resources because it can be based

on agreements with other existing public services (health, social assistance) or third sector providers. Such

partnerships should be developed mainly at local level where the needs of older workers and employers

can be better identified and co‐ordinated. Strategic partnership between key labour market actors

(entrepreneurial associations, trade unions, local or national institutions, private and public employment

services) are also important for the promotion of support for older workers. This is particularly the case in

countries where the participation of older workers is low and initiating public debate and a favourable

context for an active ageing strategy is an important precondition to launch new interventions and services.

In this respect, communication (large advertising campaigns and other communication tools) can be used to

promote new PES interventions and mobilize people to participate.

Although increasing efficiency is a key part of the forward looking strategy of all PES, this should not

preclude PES from investing to increase their capacity to work with older people through appropriate

training for specialist advisors or from refining existing services so that they are better suited to the needs

of seniors (especially e‐services and multi‐channelling approaches, which could limit the costs of

personalised services). This is also important to prevent a possible “creaming” of older clients due to lack of

an adequate service supply. The introduction of specialist advisors to work specifically with older clients

can also promote new thinking and innovation on the ageing policy; to this end, support to connect and

empower PES personnel dedicated to ageing and older workers (promotion of communities of practices,



production of review of cases or guidebook, identification of main skills for service providers, etc.) should

be provided at national and European level.

In conclusion, PES have some experience and knowledge of how to deal with the specific problems of older

workers, but this is by no means universal and in general the approach and operational practice needs to

be developed to confront the growing scale of the problem and the specific needs of older workers. The

study proposes a number of different solutions to be discussed and transferred to policy fields (activation,

employability, partnership) already identified as priorities by the EU and the PES in their strategic

documents. To move in that direction, PES have to promote national and local ageing strategies, identify

the correct service mix for older workers and work in conjunction with other actors to ensure adequate

availability of good quality tailored services that can help provide the blend of support and encouragement

that older workers need to stay in the labour market longer.



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ANNEX: Supplementary data

Table A.1 – Temporary employees as a proportion of all employees, by age group and gender, 2010, (%) Males Females 25-49 55-64 25-49 55-64

EU27 11.2% 6.7% 13.0% 7.1%

Belgium 5.8% 1.9% 8.4% 4.2%

Bulgaria 4.5% 4.7% 3.4% 4.4%

Czech Republic 5.2% 8.4% 7.9% 15.5%

Denmark 5.9% 3.7% 8.4% 3.5%

Germany 10.0% 4.7% 11.3% 4.4%

Estonia 4.2%

Ireland 6.4% 6.5% 7.7% 6.3%

Greece 10.9% 6.0% 14.0% 10.9%

Spain 24.5% 9.3% 26.3% 11.4%

France 10.4% 8.3% 13.2% 8.7%

Italy 9.9% 6.7% 14.3% 5.4%

Cyprus 6.8% 2.8% 23.7% 7.0%

Latvia 8.1% 10.7% 4.2%

Lithuania 2.6% 1.5%

Luxembourg 5.2% 6.9%

Hungary 9.5% 7.0% 9.0% 6.4%

Malta 3.3% 5.1%

Netherlands 13.1% 6.3% 15.5% 7.5%

Austria 5.0% 3.0% 5.6%

Poland 24.7% 19.8% 24.9% 23.2%

Portugal 22.2% 9.1% 23.5% 10.2%

Romania 1.2% 0.8%

Slovenia 11.5% 8.1% 15.8% 10.2%

Slovakia 4.6% 5.2% 4.8% 6.1%

Finland 9.8% 7.0% 18.5% 7.9%

Sweden 10.0% 5.4% 13.8% 5.6%

UK 4.1% 4.7% 5.5% 5.4%

Source: Eurostat, Labour Force Survey: lfsa_egaps



Figure A.1 – Drift into inactivity of people employed or unemployed in the year before by age groups and level of education, EU 27, 2004 – 2010 (%)


Table A.2 – Reasons for leaving last job for people aged 55‐64 currently unemployed or inactive but working the year before (%)



EU BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK

2006

A job of limited duration has ended 7,8 2,0 20,2 5,5 4,9 5,4 5,0 9,9 10,9 22,2 4,7 11,9 10,9 6,9 16,0 0,0 3,1 1,2 0,8 1,7 4,4 5,3 19,5 3,6 3,4 25,4 15,8 4,9

Dismissed or made redundant 16,5 5,9 15,0 11,8 14,1 26,9 10,7 16,7 2,5 15,6 16,9 13,2 14,6 13,5 6,0 4,5 10,7 3,5 0,0 12,7 13,1 22,3 12,9 10,2 11,6 14,6 23,7 16,4

Early retirement 19,7 9,4 0,6 16,4 52,2 21,0 6,1 19,9 9,6 25,7 8,5 0,0 11,9 9,6 4,3 27,6 22,3 16,7 86,6 30,2 45,1 22,7 16,9 5,2 0,0 5,5 30,1 22,1

Education or training 0,2 0,0 0,0 0,0 0,2 0,0 0,0 0,4 0,0 0,0 1,0 0,0 0,0 0,0 0,0 0,0 0,5 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,6 0,2 0,0

Normal retirement 35,2 33,3 48,9 52,9 4,5 23,9 37,4 20,5 63,2 3,1 59,0 63,9 30,4 32,7 45,2 57,2 54,8 64,6 0,0 35,7 14,7 15,0 40,9 69,2 82,6 27,9 5,4 21,7

Other reasons 9,4 42,8 7,4 3,3 6,5 11,5 3,5 12,4 10,4 12,1 3,0 5,4 12,5 19,3 13,7 5,0 5,8 1,1 6,5 7,6 8,5 22,5 0,9 8,0 2,3 10,3 6,8 16,0

Own illness or disability 11,2 6,6 7,8 10,2 17,6 11,4 37,3 20,2 3,4 21,2 6,8 5,6 19,6 18,0 14,8 5,7 2,7 12,9 6,1 12,2 14,3 12,1 8,9 3,8 0,0 15,7 18,0 18,8

2007





Other reasons 10,8 44,2 9,3 4,8 8,8 18,4 12,0 17,4 7,6 14,7 2,5 5,6 9,5 14,9 26,2 4,3 7,2 4,5 11,8 7,3 6,6 25,0 0,5 4,4 4,8 11,8 11,5 18,1


2008






Other reasons 9,1 37,5 12,7 4,2 7,1 10,9 6,4 21,5 7,0 15,1 4,3 3,7 17,9 9,1 14,6 3,6 6,9 1,9 14,7 9,8 7,9 17,1 0,5 4,7 4,2 8,5 9,3 13,1


2009






Other reasons 9,3 39,1 8,3 4,3 6,5 13,2 17,8 13,8 6,7 12,6 2,6 5,4 20,4 11,4 15,5 4,5 9,4 2,5 16,5 9,8 4,6 13,8 1,0 3,4 5,6 6,2 9,0 15,4


Figures in italics are those calculated on a limited sample

Source: own elaboration of EU LFS data

Figure A.2 – Re‐employment rate of people unemployed, retired or other conditions in the year before by age group and level of education,

EU 27, 2004 – 2010 (%)




Data for people retired with high level of education are unreliable for 2005 and 2006

Documents

EJML Senior workers final