Redefining Retirement: Is Our Ageing Population an Untapped Asset? (Professor Sarah Harper)

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2:44Hello and welcome to Radical, conversations about the underlying forces reshaping our world and the radical ideas that could define the future. I'm James Marriott and today we're talking about something that is often presented as one of the biggest challenges facing the Western world, ageing populations. People are living longer and fewer children are being born and you've probably seen or heard in the news, even on this very programme, that this is often presented as a major crisis. A shrinking working age population is going to have to support growing numbers of unproductive pensioners. But my guest this week thinks we're looking at it all the wrong way.

3:26Rather than fearing an ageing society, she says we should see it as an opportunity. Her name is Sarah Harper. She's a professor of gerontology at Oxford University and one of the world's leading experts on population ageing. Her radical proposal is that we should embrace a future with an older population. Sarah argues that our pensions, welfare systems and workplaces are still built around an outdated idea of later life, that people become frail in their 50s or early 60s, retire for a short period and then die. She wants to radically change the state pension entirely and base the pension income you receive on how long you've contributed rather than on how old you are.

4:09Her proposal, she says, is not simply about making people work for longer, it is about completely rethinking how we contribute throughout our lives, and also about asking whether chronological age should continue to so rigidly determine the way we work. But would her idea create a fairer and more flexible system, or just introduce a whole new set of inequalities? And are our workplaces, welfare state and economy really ready for such a fundamental rethink? As always on this podcast, we'll go in with an open mind and a critical lens. So with all of that in mind, I hope you enjoy my conversation with Professor Sarah Harper.

4:55Sarah, thanks so much for joining us on Radical. Thank you for having me. I wanted to start to fill in people who haven't necessarily been following this debate about an aging population. And I was wondering if you could explain what's going on with this aging world that we're facing and why are people so worried about it? Well, I think we've known for a long time that life expectancy has been increasing. And we've been looking about how we could prepare. I think what really has happened, and it actually happened around COVID, but it doesn't seem to be going back, is that there is a decline in the number of children being born.

5:30So the way we have to put this together is that an aging population is a combination of falling childbearing and falling late-life mortality. And that means that the average age of the population goes up. And so why people have become really concerned is that we have a society that's very much geared up to having lots and lots of children being born and entering our labour markets and driving our economies. and most high-income countries and indeed lots of middle-income countries are facing a world where potentially over half the population will be aged between 50 and 100 and so I don't think it's a problem and I think we've had a lot of time to prepare it's more that I think instead of some governments not all but instead of some governments are saying how can we stop this how can we change it and we can't you know this is just the way that when you have a healthy population and a well-educated population, they tend to live longer, and they tend to have fewer children.

6:30So we have to adjust our society to that. And a simple way of looking at it is many of our 21st century challenges are operating within 20th century institutions. And the whole demographics, particularly around things like work, education, retirement, and how we tend to divide that up, is very much based on a 20th century model. I think it's fair to say that you're more optimistic about our ageing future than other people are. And I was wondering if I could ask you how you arrived at this take on an ageing population, which is quite different to a lot of the more pessimistic discourse that you tend to hear.

7:06I think it's interesting because I think if you talk to a lot of demographers, we all feel the same. You know, I would say most of my demographic colleagues say, well, the demographic transition started 250 years ago. It started in Europe and we started getting healthier and better educated, more communication. And so we reduced the number of children we had and we all lived longer. And in those days, of course, it meant that we didn't die at 10. We actually made it into our 30s and 40s. Now we're in a situation where we have very, very low fertility, but we're actually living probably into our 80s or even 90s.

7:38I think there is a group of economists who tend to be maybe more rigid in how they see this. And they look at the dependency ratio and say, we're just not going to have enough workers. but I think if you say well actually let's look at what's happened to the whole population in other words we now have large numbers not everyone but large numbers in most countries including the UK of people in their 50s and 60s who are very healthy very well educated and they are able to remain contributory and so long as we can keep their health up and in fact we can increase the health of the whole population then we're not going to have large numbers of frail older adults in the way that we think.

8:19So some people think, gosh, you know, you get to 60, you can't do anything, you're getting frail. And the reality is actually that we have fantastic resources within even our older population. So I think there's a bit of a divide between some economists and most demographers. When you're making this more optimistic case, what's the kind of feedback you get? Are people receptive to it? Or do you think it's just counterintuitive to a lot of people that an ageing population can be a benefit as well as something to worry about? I think the surprising thing is I've been doing this for 30 years and I would say, let's start with the media.

8:49The amount of journalists that year after year after year say ageing populations are a problem. And I go, well, actually, we were talking about this 10, 15 years ago and we did give you some answers. I would say a lot of governments actually behind the scenes are more optimistic. I would say that the general public, many, many older people nowadays, days, and definitely if we look at the surveys that we do, older people themselves, I think, you know, they are fitter, they are healthier, and they actually want society to say, look, we are contributory. So I think it's just, it is reframing, it is changing attitudes, and I have to say, huge ageism still in this society.

9:32But then, of course, if you talk to a 15-year-old and 18-year-old, anyone over 30 is ancient. So there is actually something slightly inbuilt that we do tend to look at people older than ourselves and think, you know, life finishes at 30, life finishes at 40. And of course, it doesn't. Yeah, I mean, I'm 33. And some days, I feel pretty ancient. I think one part of reframing this is that there's a lot of anxiety around falling birth rates. And I guess perhaps implicit in your analysis of the situation is we need to stop worrying so much about fixing falling birth rates and accept that is the world that we're living in and then think how we deal with that world.

10:06Is that is that fair? I think that's exactly right. So, I mean, I think there is a lot of fear mongering out there. And let's start by looking at the way in which the population is ageing. We call it age structural change. So, again, from predominantly young to predominantly older populations. It's happening almost everywhere except for sub-Saharan Africa. And we can talk a bit about this. So there are three main ways that we can tackle this. One is tackling falling fertility, or when I say falling fertility, I actually mean childbearing. One is immigration, because there's lots and lots of young people who are being born in Africa.

10:40But obviously, immigration has a certain political take at the moment. And the other one is looking at the resources within our population and just recalibrating retirement and saying we've got to get away from this idea that everybody has a fixed retirement age because there is so much potential productivity and a knowledge economy from people in their 50s, 60s and even into their 70s. Now, if we take the first one, which is falling fertility, in a way, it's a trend that is happening everywhere. and the surveys that we do, whether we do them in Southeast Asia, whether we do them in Southern Europe, whether we do them here in the UK, the same message is coming out from younger, particularly women, but let's say younger couples.

11:26Many of them don't want to have children. They want to be child-free and a far greater proportion want to be child-free than we've seen in previous generations. So the way we can look at it, we can say, let's just take the UK. So roughly half of women, when they hit 30, 31 in this country will have had a child. So what about the other half? Now, of those, we have a growing percentage who say, I'm educated, I'm independent, I can choose the kind of life I want. And having a child is not necessarily something that I'm going to do. And that's a really big change. That's a change from my generation, where I sort of took it for granted that I probably would get married and I probably would have children.

12:09And that view has gone, and it's gone across the world, actually, outside Africa. So then we have a proportion who say, well, I'd like to have a child, but I'm a little bit anxious. And they're anxious about housing and the economy. Women are anxious about gender equality, particularly their careers being affected. And that's where policy can come in. So the number one thing we need to do is slow down this dramatic fall in childbearing rate and policy can work. What it's not going to do, it's not going to persuade women to have four or five children in this country. We know from other countries that you can pay women, you can give them tax breaks, you can look at gender equality, and most women say, yes, I'll have one or two and I will decide when to have them.

12:52So that whole childbearing question, I think, has led us to believe that we're never, never going to go above replacement level. Britain has not replaced its population since 1976 by births alone. We've always had a very healthy immigration and that has kept us buoyant. At the national and economic level, it's been very, very positive. But there have been local tensions, local tensions around things like housing and jobs and just the whole sort of preconception of what it's like to live with people who come from a different country. So we can put that to one side. We can, in a way, say, well, let's not tackle the immigration question.

13:28We can, but obviously it's sort of quite complicated. So let's have a look at what we can do about our existing population. and we really could make up for the fact that we're having fewer children and that's where we have seen a real sort of awareness oh my goodness we're not going to have enough children but we can make up that productivity from really focusing on if you like the over 40s over 50s and saying in the knowledge economy if you have health and education and we train you and we give if you flexible work, then you can contribute just as much as younger people can. Why aren't we just standing back and saying, let's look at life courses?

14:11Why is it that in our country we say increasingly to young people, because we want half our population to go on to further and higher education, you know, stay in education till your mid-20s, or when you can start thinking about retirement at the end of your 50s, and you may live till you're 90. And that is completely out of sync to the education work retirement frame that we started with when we had lots of young people and we had long, hard working lives and a very, very short retirement. So let's just stand back and say we need to rethink this whole nexus of education work retirement and how we're productive in our society.

14:50So if we're refocusing our policy lens from trying to get young people to have children who it seems that they perhaps don't want to have, to older people and thinking about how older people can be more productive, what are some practical things that you think we should be doing to make that happen? I mean, there are sort of three big areas where people are concerned. The first one, of course, is all around actually pension age and what we call the pension incentive. and so many people say to me what you know the retirement age in the UK is 65 well a we don't have a retirement age we we haven't had a retirement age for a long long long time and in fact it's also illegal for us to get rid of people on grounds of age alone there are some obviously some justifications where we can but generally we can say that and we haven't had state pension age at 65 for several years the state pension age is now 66 and it's going to go to 67 and we think it'll probably go to 68.

15:45So people who are born post 1978 probably are going to work till they're 68 in the old town. So what we have to do is, if you like, take away this link between chronological age, state pension age, and when we want to retire. Then we need to say to the employers, you're losing so many fantastic people, really, really good experienced people in the knowledge economy. As we age, we go from what we call fluid intelligence, which is very fast thinking to crystallized intelligence, which is the much more lateral thinking, creative work. So we need those people. That doesn't mean that I'm saying everyone should work flat out, but we have flexible working.

16:23We have obviously working from home. We can take sabbaticals across our life course. So we've got to say to employers, you've got to retain older workers. And then the really, really important thing is that so many older people would love to stay in the workplace, but they're not being skilled and retrained. And that is a problem across many countries. And of course, in a way, with the kind of technology that we all have in our lives, we all need to upgrade our skills. And the big question is who should actually be paying for this? You know, should it be us? Should it be our employers? Should it be the government?

16:57But the whole idea of reskilling a population so that it can continue to be contributory, I think is what many, many people are asking for. I guess there is a case that in the UK, we have pretty good age discrimination laws. You can't fire someone for being old. You can continue working as late as you like. Aren't the opportunities there already for people to work later into life? What is it that we're not doing that we should be doing to make older people more productive? So the really important thing is around skills and training. But there is a caveat. And I think it's really important that we recognise that we are actually talking about an increasingly unequal society.

17:33So we know that maybe half our population has a good level of education now, a good level of health, and is very capable to work throughout their 60s and even into their 70s. And they are working in the service economy, IT, the knowledge economy, professionals, etc. But we still have a group of people who are not so skilled, have, you know, really quite tough, sort of more manual type work that is, you know, quite exhausting. You know, caring work is very exhausting. A lot of sort of factory work is exhausting. And their health actually suffers because of that. So we've got to be careful that we do this in a sympathetic way.

18:09Because if we were to say, right, everyone works till 70, which incidentally Denmark has just said, I mean, you know, Denmark is going to make everybody, I think, who's born post 1970, they will have to work till 70. They're putting in some very interesting policies in order to do that. But if we did that in our country, we would have huge numbers of people who'd be going on to unemployment benefit, disability benefit. I ran the government's what was called Foresight Review on Aging. And, you know, our government was actually quite far thinking about this. And one of the modelling we did looking at the ONS data said that if you are a 65 year old man and you're living in the bottom 30 percent of deprived areas in this country, at 65, you will probably live till 80, but all your 70s will be in frailty and disability.

18:58If, however, you're the same person, if you're a 65-year-old man and you're living in the 30 % affluence in our country, then A, you will probably live well into your 80s, even to your late 80s or 90s, and you won't even go into frailty and disability until you hit 80. so our 70s can be so difficult and so challenging for some people and yet so positive for others so if we are going to really rethink retirement and skills and training we've got to do something about the inequality of health and education in this country. I'm interested in the idea of changing attitudes to old age and I was wondering how can you change cultural attitudes that seems like quite a difficult thing to accomplish or is there a case that cultural attitudes are kind of changing anyway and our idea of old age is transformed perhaps from what it was I think even when I was a kid I think when I was I mean partly this is being young but I think once upon a time being 70 seemed quite old and now perhaps there's an argument that in your 70s that's more like later middle age so how optimistic are you about those changing attitudes and what more could we be doing to make those attitudes change yeah I mean just in the terminology so at Oxford one of the things we started doing 30 years ago was we said let's stop talking about old age.

20:14Let's start talking about later life. Another thing we did was say, stop talking about the elderly or even old people. Let's start talking about older adults. Big international organisations use far more sort of positive terminology. As I said, we're in a very, very, very ageist society. But when you're talking about changing cultural attitudes, I think one of the really interesting things is to look what happened to women and ideas around gender. So in the 1950s, there was this real push to get women back into the home after the war. You know, all these men were coming back and they needed jobs.

20:50And there was huge, huge sort of sex discrimination against women. And slowly, slowly it changed. And now if you read things from the 50s and 60s, you're actually quite horrified that women were almost seen as a completely separate group. They had, you know, lower education. I mean, for example, for a woman to go to a grammar school was incredibly difficult because priority was given, you know, to the male grammar schools or far more boys grammar schools. Things do change. But in order for those attitudes to change, we do need policies and we do need things like employment. And we do need really to help people internalise the fact that just because you turn 60, you're not sort of off the shelf.

21:28You may have 30 years of life left, of which 20 could well be. if I say productive, you may not be in economic employment, but you almost certainly will be taking a big role in society and you may well be caring for grandchildren or for older adults or really just being a contributory person.

21:52I hope you're enjoying my conversation with Sarah Harper. Don't forget you can subscribe to this podcast on BBC Sounds so you don't miss future episodes. And make sure you've got push notifications turned on, and that way you'll get an alert whenever we publish a new episode, so you'll never miss out. Now, back to Sarah Harper.

22:14What's the case that you would make to an employer thinking about hiring somebody new into a role that they might think about hiring an older person? I mean, plausibly you're looking at this transformed 21st century economy, AI is rushing ahead. What would the arguments you would make that in this fast changing world, maybe that someone older might be a better economic bet than a younger person? So not only what would I do, what do I do? I give lots of talks to corporates. And I would say that generally, on the whole, they are quite receptive. And what is really interesting is I've been doing it for 20 years now.

22:47And 20 years ago, particularly, I do a lot of talks with financial institutions. And a lot of financial institutions just cast people out by the time they got to their mid-50s. Now, quite often, there are people in their mid-60s who are still in very senior positions. And there's a lot of people who are maybe not working full-time, but are still very much in the corporate world. And I think it's very interesting, if you look at the statistics around the financial crash, so the sort of 27, 28 financial crash, that was the first time in this country that when everything sort of settled more younger people had basically been made redundant than older people because up until then if ever there was a problem cast the older worker out and this time it was slightly more balanced and they looked at people in their 50s and they said gosh we need you it is naturally happening I mean one thing we need to do is is just stop this linking of chronological age with attributes I mean okay you know we can look at a two-year-old or a four-year-old and we can say roughly they're going to be like this but even when you get to 40 I remember I had two colleagues and one they were both 40 they're both just turned 40 one was a breastfeeding mother and the other one was a grandmother so in terms of life course they were in completely different places and yet they just happened to have the same chronological age so in lots of ways I think one of the things that would make a huge difference is if we separated state pension receipt from a particular age and instead let's say you've got to work so many years let's say you have to work 45 years so if you are a manual worker who maybe starts working you're going to an apprenticeship and you start working maybe at sort of 18 then you actually in your sort of early 60s when you you know probably maybe your health isn't as good possibly and maybe you are tired you can take your state pension if you're a professional person like a doctor who's gone to university and training you don't even start working till you're you know 26 or whatever you work for 45 years and you will be in your 70s taking it away from a set age i think you know would be transformational because we wouldn't think of state pension age retirement old age we would think well we have to contribute to our society for a certain length of and we can have a debate about how long that could be.

25:04And then we have a pension and that pension will help us in our later life. Listening to you, I think that, you know, a lot of what we hear in the news at the moment is that our society is often quite biased against young people and there's a generation of people in their 60s and 70s who've done very well out of the economy and there may be young people listening to this saying, hang on, so much of what we hear is that people at the beginning of their careers are struggling to get a foothold on the ladder. it seems like those early career positions might be under threat from AI maybe in 10 years time if I have got my foot in the employment ladder I'll be wanting to move on in my job and I'll find that my path is blocked by a load of people in their 70s who are doing the jobs that I want to do in my 40s or late 30s aren't we just looking at the problem completely the wrong way what would you say to that criticism so in other words that is a well-known economic fallacy which is that you have blocking we know that the more productive people that there are in an economy, the more jobs are created.

26:01And we also know, for example, that a younger person who is well-educated and in good health actually has some really fantastic opportunities. Again, it comes back to the problem that we have a large number of younger people who are not getting the health, the education and therefore the opportunities. I think we shouldn't pitch people against each other. I'm not saying that we need to keep older people all 100 % working. What I'm saying is across the life course, if you want to go into education and training, if you find you've got caring responsibilities, whether that be having children or whether it be caring for each other or caring for an older parent or just deciding you want to go on a sabbatical or you want to have education, you should be able basically to have that.

26:49And if we have a highly skilled population, then those kind of resources can be equally distributed. So at the moment, you have roughly, I think it's 3.5 workers for every one pensioner. And there is a fear that by 2050, and just do the sums, how old you'll be in 2050, I mean, you'll probably be coming into that old age group yourself. So we are talking about people, many who haven't yet been born, there are going to be three workers for every one person. If we raise the state pension age to 70, although, as you know, I think we should probably disconnect it from chronological age, then we would keep that dependency ratio more or less as it is.

27:30So young people wouldn't have so much of a fear that, oh, my goodness, all our taxes are going to go to old people. Those old people, as we sort of currently define them, people in their 60s and 70s would actually be contributing to our society. And I think it's a real problem when you start pitching generations against each other. You know, every generation has opportunities, every generation, you know, has issues and problems. And I think actually, if you're looking at the children who are being born today, let's look at climate change. Let's look at the geopolitical world. And they're the ones that I fear, actually, not so much, you know, people in their 20s, 30s and 40s, because I think, you know, many of them have got still, they've got, you know, you've got a long time of your life left and there are lots of opportunities out there.