Employment and Social Developments : Employment of older workers rises slightly, poverty declines

In January, the Commission has published its annual report on Economic and Social Developments in Europe. The report highlights a slight reduction of unemployment rates in 2014 compared to 2015. Employment of women and older workers continues to rise, however very slowly. The rate of poverty and social exclusion fell by one million from 123 to 122 between 2013 and 2014. The report also highlights the importance of training to promote employment.

Employment: slow rise for 55-64 year-olds, women’s employment over pre-crisis levels

Older workers, whose employment rates continued to increase since 2008, are more likely to be employed – in 2014, older worker’s employment rose by 0.7% to 51.8%. This still means that almost one in two older workers is out of work and hides strong differences between the 55-59 year-olds (67% employment rate) and the 60-64 year-olds (38%). Women’s employment increased to 63.5%, almost one percent above pre-crisis (2008) levels. Men’s employment increased by 1.7% between 2013 and 2014, bust still has not reached pre-crisis levels. Employment growth came mainly from the sevices and wholesale sectors, jobs numbers continue to decline in agriculture and construction. However, these signs are ambiguous, as the average number of hours worked are still below pre-crisis levels and unemployment is increasingly composed by long-term and very long-term unemployment. Older workers are not most at risk of long-term unemployment, however the likelihood of older job-seekers to move to employment has declined during the crisis – older job-seekers are more likely to move to inactivity than to employment. Older jobseekers are also the least likely to participate in life-long learning and active labour market policies.

Risk of poverty and social exclusion slightly declining, but fragile

Despite a slight reduction of the absolute number of people at risk of poverty and social inclusion in 2014, the risk remains high and affects one in four Europeans (24,4 %). However, relative poverty (measured at 60% of median incomes) increased as well as the number of people living in jobless households (11 %). Only severe material deprivation improved, falling slightly to 9 % in 2014. Those most exposed to the risk of poverty remain working-age population and their children, older persons benefit from relative stability of pensions. For the recovery to reduce poverty, it is not sufficient to have more jobs, as only half of those who are at risk of poverty and find into employment effectively

Call for investment into skills

The report makes a point on the importance of investing into skills to reduce unemployment. The EU shows lower average scores of adult literacy than other OECD countries and investments into skills remains low in comparison, while companies complain about the difficulties to find personnel matching the skills they are looking for. However, older unemployed are the least likely to benefit from life-long learning measures. Overall, more unemployed in the EU participate in education and training in 2014 than before the crisis, however in just under half of the member states, this number has fallen. As employment of long-term jobseekers is most likely after training and life-long learning measures, the findings highlight the disadvantage of older unemployed. Investments in life-long learning programmes can be a real benefit for them.

Policies to support working longer

The report also highlights some factors that allow people to work longer. Overall, older people combine work with retirement when they financially have to, are in good health and benefit from high spending on health and long-term care, if they have more flexibility about their working hours and if they have participated in life-long learning. Incentives such as tax breaks can also contribute to longer working lives.

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