The Australian Government has made us very much aware of the economic effect of the COVID 19. Australia is facing a deep recession.
What does this mean for retirement plans for older employees and business owners? Is there a possibility that retirement will be delayed or even perceived with dread by many?
The answer to this is of course YES.
For many mature aged business owners, particularly those in the hospitality industry, the possibility of recovering lost income is very concerning. Even worse, it could be difficult to sell the business in a recession.
Employees nearing retirement age and who have been fortunate enough to be kept on the Jobkeeper payment may have seen their wages reduced if the business owner has not been able to match their former remuneration. Additionally, and this affects current retirees as well, the stock market is volatile and interest rates are at historic lows. So, do these employees put off their retirement?
According to a report from the Social Services Group, The Brotherhood of St Laurence “The economic impacts of the pandemic on mature-age, low-income people have been particularly severe. We estimate up to 30 per cent of the newly un- or underemployed are aged 51 to 65. This means nearly 400,000 Australians aged 51 to 65 have had their hours and/or employment impacted. The result is that this group of mature-age, low-income Australians is growing rapidly. Government responses are welcome but must meet long-term needs”.
The paper – titled “Hidden in plain sight” – calls on the government to address discrimination experienced by mature-age workers and ensure social security benefits such as the Jobseeker payment “remain above subsistence levels”.
“Not yet eligible for the pension or aged care, many of these people are caught between employment and retirement: too old to work and too young to retire,” it says.
With so much for the Government to weigh up when addressing repair of the economy, it is hoped that mature aged workers will be considered for special programs and assistance. Otherwise their forced “retirement” will be the cause of great economic hardship and loss of self-worth and certainty for many. Our labour economy will also be the poorer for the loss of experience these workers bring.
To read more about the “Hidden in plain sight’ findings, here is the link