The percentage of people aged 50 to 64 who are out of work now stands at 33.8% (3.96 million), compared with 19.7% for the under 50s, if we exclude full-time students. Today’s report from the ONS, the Labour Market Statistical Bulletin for July 2011, shows that unemployment for people aged 50 to 64 in the UK increased by 2,000 on the previous quarter, compared with a fall of 28,000 for the under 50s.
Change in number of unemployed since the start of the recession
Since the start of the recession, the number of unemployed people over the age of 50 has increased by 53.5%, compared with 37.3% for those aged 18 to 49, according to the most recently available figures. So older people are suffering like everybody else – but worse on almost all measures.
Percentage of the unemployed who have been out of work for over 12 months
Over 50s continue to represent a disproportionately large, and growing, segment of the long-term unemployed. 43% of unemployed over 50s have been out of work for more than 12 months, compared with 38% of people aged 25 to 49, and 25% of those aged 18 to 24. The chart shows how long-term unemployment has grown since June 2009.
If you're new here, you may also want to visit our main web site PRIME Business Club where we provide lots of practical information to support clients.
The latest labour market bulletin from the Office of National Statistics appears encouraging on the surface. Unfortunately, the drop of 36,000 in the quarterly unemployment figures masked an increase of 11,000 unemployed people over the age of 50.
What’s even more worrying is that the figures show that the over 50s are continuing to find it harder to get back into work. The number of over 50s who’ve been unemployed for more than two years has increased by 14,000 (or 18 per cent) over the last quarter to 91,000. This is very bad news, because we know that the longer you are out of work, the harder it is to get back into a job.
PRIME is responding to the challenge by working actively with DWP, JobCentre Plus, and providers in the forthcoming Work Programme. We hope to be involved in tailored initiatives to help the over 50s back to work through self-employment.
“Olderpreneur” is undoubtedly a bit distasteful or irritating. Maybe that’s why it sticks in the mind so well.
We’ve found that older entrepreneurs themselves are split about about whether they like it. We’re not sure exactly how opinion divides, hence this poll – which we are also running on our client-support site PRIME Business Club.
It’s more ugly or clumsy or trivialising than truly offensive, in my view.
We use it because it works. People find us by using Olderpreneur as a tag or search term. Journalists also like it – because it’s shorter than anything else that gets the meaning across.
The people who read the stories may not remember that our name is PRIME, which is in any case a very common word used by prime ministers, mathematicians and bankers. But that irritating weird word Olderpreneur sticks in the mind better – hopefully long enough to be typed into a search engine, which will bring someone looking for us to our site.
It works well for us in search engines because they tend to like unique content, and this includes unusual words. So it’s usually the case that if you can find an obscure term relevant to your business it is worth including it on your site. Should anyone search on that term they are then quite likely to find your site – because you should appear high in the search engines’ results.
Many of the other collective terms you might use to describe older business starters as a phenomenom are equally cringe-worthy. Mature entrepreneur, senior entrepreneur, silver entrepreneur, grey entrepreneur – they are all pretty yucky too. We could plaster them all over the site as well, but that really would be irritating.
So Olderpreneur may not be ideal. But until someone comes up with a better phrase the business case for using Olderpreneur on this site is overwhelming. Anything that brings your audience to you so efficiently has plenty to recommend it.
This Panorama investigation highlighted the difficulties faced by unemployed over 50s, and made the point that unemployment isn’t just about young people. The programme, called “Finished at 50?”, is available on BBC iPlayer for 12 months, and well worth watching. It also attracted lots of viewer comment.
Whilst the broadcast focused too much on the plight of skilled middle-class professionals, and failed to recognise that there are parts of the country where there are just not enough jobs on offer, the basic demographic problem was recognised. The work force is ageing at the same time that jobs are in very short supply.
It was encouraging to see self-employment presented as viable work option – although they missed the point that business survival rates for over 50s are much higher than for younger people, and that almost one-in-five working over 50s are self-employed.
I also fully support their view that the contractors who will be partnering JobCentre Plus under the new Work Programme from this summer need additional incentives to provide proper support for this harder-to-help customer group. Otherwise they will simply be ‘parked‘.
The government has announced the main contractors who will take on the task of delivering the new Jobcentre Plus welfare-to-work programme, due to start going live in June and July this year.
The 16 private and two voluntary-sector organisations named as Work Programme preferred bidders will now go on to award sub-contracts and recruit staff to do the actual delivery.
PRIME was involved as a partner in 12 of the successful bids. But we don’t yet know exactly what we will be doing.
It’s too also soon for claimants to find out exactly what support will be available from which of the 751 Jobcentres in England, Scotland and Wales. This won’t be known till the winning bidders have got their services set up on the ground. However, the pressure is on to get the programme into Jobcentres by the end of July at the latest.
Some of the new Work Programme main contractors have already got existing infrastructure such as qualified staff, premises and sub-contractors in place because they have previously worked on similar programmes, such as New Deal. But others haven’t – or their offices, trainers and managers are many miles away from where they are now required. This could make meeting the summer start date much more of a challenge.
The Work Programme is replacing other Jobcentre schemes such New Deal, which have historically been important to PRIME clients as one of the few officially sponsored routes off benefit for people considering self-employment.
One key limitation of the Work Programme compared to New Deal is that you have to wait longer as a claimant before you become eligible – 12 months as compared to six months (for over 50s) on the New Deal. PRIME is keen for this qualifying period to be re-examined, since it makes little sense for older people – who are especially unlikely to be offered a regular job, to wait a whole year on benefit.
Fortunately there are some other new programmes that will have a shorter delay, notably the New Enterprise Allowance. The qualifying period for this on Jobseekers Allowance is 26 weeks.
Top-level Work Programme contractors
Scotland
Ingeus UK Limited
Working Links
Wales
Rehab JobFit *
Working Links Wales
North East
Avanta Enterprise Limited (TNG)
Ingeus UK Limited
North East Yorkshire & Humber
G4S
Newcastle College Group**
West Yorkshire
Business Employment Services Training (BEST) Ltd
Ingeus UK Ltd
South Yorkshire
A4E Ltd
Serco Ltd
North West(Merseyside, Halton, Cumbria and Lancashire)
A4E Ltd
Ingeus UK Ltd
North West(Greater Manchester, Cheshire and Warrington)
Avanta Enterprise Limited (TNG)
G4S
Seetec
East Midlands
A4E Ltd
Ingeus UK Ltd
West Midlands (Birmingham, Solihull and Black Country)
FourstaR Employment & Skills Ltd
Newcastle College Group**
Pertemps
West Midlands (Coventry, Warwickshire, Staffordshire and the Marches)
ESG
Serco Ltd
East of England
Ingeus UK Ltd
Seetec
West London
Ingeus UK Ltd
Maximus Employment UK LTD
Reed in Partnership
East London
A4E Ltd
Careers Development Group (CDG) *
Seetec
South East (Thames Valley, Hampshire and IOW)
A4E Ltd
Maximus Employment UK LTD
South East (Surrey, Sussex and Kent)
Avanta Enterprise Limited (TNG)
G4S (Private Sector)
South West (Gloucester, Wiltshire and West of England)
JHP Group Limited
Rehab JobFit *
South West (Devon, Cornwall, Dorset and Somerset)
Prospects Services Ltd
Working Links
External links:
Indus Delta – popular site for welfare-to-work providers.
Chris Grayling MP – blog of the Minister for Welfare Reform at the Department for Work and Pensions.
Startup Britain www.startupbritain.org is a new web site “designed to celebrate, inspire and accelerate enterprise in the UK” that launched on the 28th of March 2011. It has fulsome praise from the government – including the PRIME Minister in attendance at the launch and a press release distributed direct from No 10, but little or no government money behind it. The site itself seems to offer mainly links to other existing support web sites, with its own original content currently consisting mainly of discount offers from established businesses.
Startup Britain - valuable resource or just platform for self-promotion?
That’s not to knock discount offers – we run them ourselves on PRIME Business Club, in the belief that they can be useful to cash-strapped new entrepreneurs trying to keep spending under control. So a new offers site is to be welcomed. But it’s not really business help – more a form of advertising.
It’s hard not to see Startup Britain as evidence of a decline in the quality of the support and encouragement available to new enterprises. It’s simply not in the same league as some of the things that are closing down at the moment. We have just lost Enterprise UK – which for all its obsession with youth did still attempt to beat the drum loudly for those starting up new small businesses. A much more substantial loss is the closure of the Business Link local advice service, which has shut down already in some places and is scheduled to disappear everywhere by November 2011 – leaving just a web site and call centre.
So the lavish praise heaped on the meagre resources offered by Startup Britain are not very convincing. Business support in Britain, certainly for small self-employed businesses, looks to be in serious decline.
PM David Cameron talking at the launch event
Still, in the absence of serious government investment this is the kind of thing we shall have to get used to. Maybe Startup Britain or some other private initiative will eventually amount to something. So we wish them luck.
What Startup Britain says about itself
StartUp Britain is a new campaign by entrepreneurs for entrepreneurs [...]
This is a response from the private sector to the Government’s call for an ‘enterprise-led’ recovery. We believe that many of the important functions and services necessary to foster and champion new enterprise can be open-sourced, instead of provided by government directly. We aim to do this by creating a living market-place online for the wide range of enterprise support that is already available.
As a private sector organisation we aim to shoulder some of this responsibility for enterprise promotion with the government, re-modelling existing cost centres, and reducing the cost to the taxpayer.
The number of people aged 50-64 who are out of work has now topped the four million mark, according to figures published today by the Office for National Statistics in its January labour market statistical bulletin. The four million is made up of 3,648,000 economically inactive, and 386,000 unemployed. These figures relate to the period September to November 2010.
This latest increase is particularly worrying, as public sector job cuts are only just getting seriously underway, and these have a strong tendency to hit older workers hardest. Of course, once out of work, the over 50s are more likely to become long-term unemployed.
The number of jobless people aged 50 to 64 rose by 21,000 from last month to 4,006,000 – and now sits at rate of 34.3% (more than one-in-three); this compares with a rate of 20.0% for under 50s, excluding full time students.
Long-term unemployment continues to be a major concern as it hits the over 50s harder:
61% of the unemployed over 50s have been out of work for six months or more, compared with 52% of under 50s
43% of over 50s Job Seekers Allowance claimants have been claiming for six months or more, compared with 32% of under 50s claimants.
Peter Bennie, PRIME’s Director of Development, says that much more needs to be done to tackle this costly and damaging trend. “We know that the majority of those over 50s who are out of work are not there by choice, and would welcome assistance to re-enter the job market.
“We also see in this month’s ONS figures that the number of people aged over 65 who are still in employment has actually gone up. It has risen from 764,000 to 870,000 (a rise of 14%) over the year to November 2010. Hopefully this means that an increasing number of employees are beginning to recognise that reaching the traditional pension age for men should not be regarded as a barrier to work.”
Another positive development is the growing contribution self-employment is making to keeping people in work, though whether this will be adequately reflected in government job creation programmes remains to be seen.
Across all age groups, self-employed people now account for almost 14% of all those in employment.Self-employment seems to be one of the few engines of job creation that is still working effectively.
The number who are self-employed increased by 101,000 to 3,980,000 over the year to November 2010. This represents an increase of 2.6% – whereas the number of people who are employees increased by just 0.6% over the same period.
We’re pleased that the Government is pressing ahead with plans to abolish the Default Retirement Age – as our population ages, it is vital for economic recovery and growth that more older workers are able to stay in work if they so choose.
During the recession, the number of economically active people aged over State Pension Age actually increased, by around 10%, indicating that there is huge potential for older people to continue to make an economic contribution.For the individual, there are significant health, financial and social benefits to be gained by staying in work.
Our big challenge is how to tackle the higher rates of worklessness experienced by older people; there are currently 4 million people aged between 50 and 64 who are not working, costing the economy around £72 billion per annum in benefits and lost productivity.
So while the abolition of the Default Retirement Age is welcomed, we also need to do more to support older people to remain in work, to make the transition to other types of work, including self-employment, and for those who find themselves made redundant, to provide help back into work at an early stage, well before they become yet another long-term unemployed statistic.
The November employment figures, published by the Office for National Statistics today, show that unemployment is continuing to fall, but the picture for the UK’s over 50s isn’t quite as positive, as shown in the figures below.
With 50+ worklessness now sitting at almost four million (3,950,000), we need innovative, sustainable solutions to tackle the personal and economic cost. Our workforce is ageing, as the demographic impact of the post-1945 baby-boomer generation works its way through the age bands, and changes to State Pension Age keep people in the workforce for longer.
Worklessness
Worklessness is a measure that adds together those defined as “inactive” – for example on a disability benefit, and those claiming Jobseekers Allowance (JSA) who are the ones counted as “unemployed” in the strictest of sense in official figures. Worklessness is therefore the broader measure, and is more appropriate for the long-term unemployed and older people as many of them end up on disability benefits rather than JSA.
Worklessness among those over 50 (people aged 50 to 64) fell slightly from last month to 3,950,000 – a rate of 35.1 per cent. This compares with a rate of 19.7 per cent for worklessness among the under 50s, excluding full-time students.
Unemployment
Overall, there was a drop of 9,000 in the numbers of unemployed of all ages between the quarters to June and September 2010. Numbers of unemployed over 50s actually rose by 2,000, offset by a fall of 11,000 for the under 50s.
The year-on-year change in numbers of unemployed continues to hit over 50s harder. Over the last three months, numbers of unemployed dropped for the under 50s but rose for the over 50s. Between September 2009 and September 2010 the number of unemployed dropped by 1.7 per cent for the under 50s – but rose by 4.8 per cent for the over 50s.
Long-term unemployment
Long-term unemployment continues to hit the over 50s harder. The proportion of over 50s who have been out of work for six months or more is 61 per cent compared with 52 per cent of under 50s. If you consider just those claiming Jobseekers Allowance, then 44 per cent of over 50s JSA claimants have been claiming for six months or more, compared with 34 per cent of under 50s claimants
Enterprise Week, or Global Entrepreneurship Week (GEW) as it is now called, is with us once again. Judging by the launch at Google’s London HQ on Monday 15th November, this annual festival of enterprise is quickly reverting to being a youth-only affair, despite the new all-embracing title. There was not a single mention of older entrepreneurs, and the stress was put on enterprise education in schools – hardly relevant to the growing number of workless over 50s.
It got worse. Dragon’s Den judge Peter Jones is chairman of Enterprise UK, which runs GEW in this country. In his speech he lamented the fact that in the UK we do not have a “do or die” culture, and that here enterprise is a choice, not a necessity. Well tell that to a 54 year old who has just been made redundant! Unlike many young people a redundant 54 year old is unlikely to have a parent they can go and live with when times are financially tough.
The next Dragon to speak also eventually parted company with reality, but it took a bit longer. Doug Richard remarked that the relevance of capital to a business start-up was diminishing, as often less money was required – and that it was not the job of banks to fund a new business anyway. Rather the cash should come from family, friends and equity – and even fools willing to invest.
There is an interesting and even witty observation here about the role of banks – they are not the place budding entrepreneurs are likely to find support. Unfortunately the alternatives suggested by Doug are not available to everyone – and particularly not to many of the over 50s who have been out of work for any length of time. Our experience at PRIME is that such people do often need to raise some capital before they can start-up, but their networks of family friends and fools can be severely diminished by the experience of unemployment. Their remaining contacts can often be in the same cash-strapped boat themselves.
Equity capital is not generally available for very small businesses, but even if it were, would a private investor take on a fifty-something necessity entrepreneur who has been workless for twelve months or more? It’s not very likely.
So it’s been a very disappointing beginning to Global Entrepreneurship Week if you happen to have been born earlier than 1960. Let’s hope it improves.
On a more positive note, Matt Brittin, MD of Google UK said that their research showed that a Small or Medium Enterprise using the Internet grows four times faster than a small business that does not use the Internet. The Internet is one of the factors bringing the cost of starting a business down. Google’s own Getting British Business Online campaign (a joint initiative with Enterprise UK, BT and numerous other partners which PRIME also has been backing over at PRIME Business Club) has made a useful contribution by offering free web sites to small firms.
This is a much more useful initiative than many of the well-meaning computer-literacy projects aimed explicitly at older people. These have a regrettable tendency to focus on IT for older people drawn from a sepia-tinted world of stereotypes, who only seem to be interested in things like chatting with their grandchildren – rather than in IT for making money. It’s the latter that many of today’s grandparents (many in their 40s, 50s and 60s) could actually do with some help on.
PRIME has good reason to be proud of its impact. Our latest survey to find how many of its clients go on to start a business shows that the headline figure is 45 per cent. The survey asked a random survey of 500 clients who contacted us between October 2008 and September 2009.
This looked better than even we expected so we dug a little deeper. Sure enough there was a group of people, all over 50, all of whom had been made workless, but who said they had already started their self-employed business.
We have learnt that it is easier to name the day that the universe was created than to say when a business starts. Small businesses rarely start with a big bang: they morph in. Their early movements are as jerky as a novice driver using a clutch for the very first time. Often the business has started with no help whatsoever and is struggling. This is why PRIME takes in businesses that have been going for less than a year that need help.
Doing this, of course, helps the individual but muddles the clarity of the figures. We therefore took out anyone who made any kind of a start – whatever that meant, before contacting PRIME. This still showed that 30 per cent of those we helped in any way went on to start a business.
We then looked at a lot more. Differences between the sexes and the regions: happiness with the way things turned out: categories of businesses started: what clients said they needed: why they did not go ahead.
But the number of business starts is always the sexy figure. In the last financial year we helped 4,665 people. Who can work out what 30 per cent of that is in their heads. Problem? Go straight to the report elsewhere on this site.
Olderpreneurs are not being put off by the recesion. A higher proportion are going ahead and giving self-employment a go than five years ago. And the gender gap is narrowing – a higher proportion of women are going ahead than five years ago,
These are among the results of a follow-up study PRIME has completed to find out what has happened to clients a year or so on. The sample was taken from clients who registered with PRIME in the year between October 2008 and September 2009. Telephone interviews were carried out in the third quarter of 2010, at least 12 months later. This interval was to allow time for people to plan their ventures and get them underway.
2010 follow-up survey
(Note: this chart automatically updates to show the latest results.)
So in the 2010 survey, 45 per cent of clients interviewed went on to start a business, 41 per cent are still considering it and 15 per cent have given up. The main change compared to the earlier survey is that now fewer people are giving up – 15 per cent now compared to 27 per cent five years ago. The economic downturn provide a plausible explanation, with fewer conventional jobs available and more unemployed people competing for them.
Number of business starts
In principle we can use the proportions above to get a fairly accurate idea of the number of people that PRIME assists who go on to start a business. With over 500 respondents the sample is large enough to give a good idea of what’s happening to everyone registering with PRIME.
There were some differences between areas of the country, age and gender in the start-up rate, but the overall figure of 45 per cent going ahead provides a useful touchstone. It suggests that of the 3,793 clients registered by PRIME between October 2008 and September 2009, about 1,700 of them will have started a business.
However, not all of these were brand new starts. PRIME can also help those in the process of starting up – provided they haven’t been self-employed for more than a year and as long as they qualify because of their age, prior unemployment or redundancy. This latitude is necessary because people coming off benefit and attempting to go into self-employment don’t all do it in an instant big-bang way. Often the process is stop-start and tentative as they attempt to find a viable niche.
So allowing for the fact (know from clients’ registration forms) that around 15 per cent are in the already-self-employed category, we can also use the ratio of 30 per cent to find the number of brand new starts helped by PRIME. This equates to 1,138 new businesses in the study period October 2008 to September 2009.
We can go on to apply the same proportions to get an approximate idea of client outcomes in other periods, assuming the percentage of people remains the same. In the financial year April 2009 until March 2010, PRIME had 4,665 clients, so using the figures from this survey and applying the 30 per cent and 45 per cent ratios, it would be reasonable to project around 1,400 brand new starts from PRIME’s client group, with a further 700 recently-self-employed also assisted. So that’s over 2,000 new businesses started by PRIME clients in the 2009-10 financial year.
Other findings
Two-thirds of those starting a business were happy with the way things had turned out and a quarter were unsure. Men who started a business were happier than women with the way things had turned out.
Compared to the 2006 study, an increasing percentage of women are now starting their own businesses. They were more likely than men to run a part-time business. Over 70 per cent of businesses started by male respondents were full time, compared to 49 per cent for female business starters.
Women were more likely to start a business in care, health and beauty, in arts and crafts and in teaching and training, and men more likely to enter consultancy and home maintenance. But there are huge variations in the businesses started within each category, so these results need to be interpreted carefully.
Two-thirds of the clients in the sample survey rated PRIME’s services and support as good or better (over seven out of 10 on a 10-point scale). PRIME will be building on this to improve our rating.
Interviews were completed with 503 clients, representing 13 per cent of the 3,793 eligible clients (unemployed or otherwise workless, under threat of redundancy or newly self-employed but coming from a workless state) registering with PRIME in the period. The survey replicated a similar study undertaken approximately five years earlier (published in March 2006 but with most of the fieldwork completed in 2005), enabling some longitudinal comparisons. See PRIME publishes study into olderpreneur outcomes
Chancellor George Osborne has announced that as part of the £6bn savings the Government is aiming to save through Public Sector Reforms under the Spending Review, that there will be an estimated 490,000 reduction in headcount over the next four years.
The Public Sector workforce has an older age profile than the private sector, with an estimated 30% of employees being aged over 50, and for those over-50s who lose their jobs, the chances of remaining unemployed are much higher. This could add almost 150,000 to the current 4 million workless over-50s, which already costs the UK economy some £72bn per annum in welfare benefits and lost productivity.
According to Office for National Statistics figures for August1, 43% of unemployed over 50s have been out of work for more than 12 months, compared with 34% of under 50s; over the period of the recession, we have seen a disproportionate number of over-50s becoming long-term unemployed, and it is worrying to see that this trend is continuing.
The total number of workless people aged 50 to 64 now stands at almost 3.97 million, more than one-in-three, compared with one-in-five for the under-50s2.
Osborne announced a further £5bn saving through Pension Reform, by moving State Pension Age for both men and women from age 65 to age 66 by the year 2020; whilst this clearly reduces the pensions bill, we question whether the calculations take into account the sizeable proportion of people of this age who are out of work, with little prospect of getting back into a job. For this group, we could simply be shifting the cost from the Pensions budget to Welfare Benefits.
The Chancellor also made reference to the coalition Government’s new Work Programme which is aiming to provide intensive support to help people back into work, and to the role to be played by the private and third sector organisations. PRIME sees an opportunity to use its’ expertise to tackle growing levels of 50+ worklessness, including support to help individuals set up businesses and becomes self-employed. There is a lack of confidence that there will be sufficient private sector jobs in the economy, and for many, self-employment will be a necessary option.
Government has yet to announce the detail of the Work Programme, but is expected to make specific support available to older jobseekers, recognising the particular challenges they face in re-entering employment
1ONS Labour Market Statistical Bulletin October 2010
2ONS Labour Market Statistical Bulletin October 2010, excluding full-time students.
PRIME is concerned at the disproportionate impact the Public Spending Review is predicted to have on the UK’s older working population.
The Public Sector workforce has an older age profile than the private sector, and for those over 50s who lose their jobs, the chances of remaining unemployed are much higher.
According to the Office for National Statistics1, 43% of unemployed over 50s have been out of work for more than 12 months, compared with 34% of under 50s
The number of workless people aged 50 to 64 now stands at almost 4 million, more than one-in-three, compared with one-in-five for the under 50s, excluding full-time students.
Peter Bennie, PRIME’s Director of Development, said “Over the period of the recession, we have seen a disproportionate number of over 50s becoming long-term unemployed, and it is worrying to see that this trend is continuing. There are particular challenges for those who have only ever worked in the Public Sector, and I am not confident that private sector employers will have sufficient jobs to offer, nor be positive about employing older workers.”
1ONS Labour Market Statistical Bulletin October 2010
The percentage of people aged 50 to 64 who are out of work now stands at 33.8% (3.96 million), compared with 19.7% for the under 50s, if we exclude full-time students. Today’s report from the ONS, the Labour Market Statistical Bulletin for July 2011, shows that unemployment for people aged 50 to 64 in the UK increased by 2,000 on the previous quarter, compared with a fall of 28,000 for the under 50s.
Follow us on Twitter 
