14 October 2020

As businesses go through turbulent times adjusting to Covid-19, they are relying on the valuable skills of their staff, such as senior employees who have accumulated a wealth of knowledge and expertise over the years. Our colleague Kristina Potocnik, Senior Lecturer in Human Resource Management, explains why organisations trying to cut costs should think twice about identifying staff who could retire early.
Don't Push Your Senior Staff to Retire Without Proper Planning

Although popular wisdom suggests that retirement is an opportunity to start doing things that you have always wanted to do but never found the time to do, it is considered to be one of the most important transitions in life that needs careful planning. Such planning does not only involve sufficient financial provision, but also planning how free time during retirement could be spent. As a result of retirement, people suddenly have much more free time which, according to one of our studies, they need to fill with meaningful hobbies and activities in order to live healthy and fulfilling lives in old age.

Our research links being active to better quality of life in old age. In its broadest sense, "being active" means things such as doing exercise, learning new skills, doing charity or volunteer work, or participating in local community events and organisations. In the current situation of the pandemic, older people have to find ways of safely engaging in such hobbies. In most cases, this could be achieved by engaging in them online (such as online courses, physical exercise via Zoom, online bridge, and so on), but keeping active can also be achieved by pursuing hobbies on your own, such as reading, doing jigsaw puzzles, baking, or railway modelling. Our findings suggest that not all retirees embrace this new chapter in life by pursuing different hobbies and interests, and this might be particularly difficult if they are suddenly pushed towards retirement without proper planning.

Our findings have a numbre of implications for businesses as they navigate through turbulent times. We encourage businesses to retain their senior staff if they wish to continue working as they can help them recover. However, if older workers wish to retire, then businesses should provide them with help and support with retirement planning that goes beyond financial planning to also include a long-term vision of what people can do in their spare time and how to keep active in retirement.

In the long term, providing training to older employees to help them prepare for their retirement better might benefit businesses in terms of attracting highly motivated and healthy retirees back to their companies on a part-time basis. Businesses can provide in-house retirement planning, or outsource this to well-established retirement planning provides, such as LaterLife Learning, or consultancies that cover retirement planning in their wider portfolio, such as Connor.

Our findings also have implications for policymakers concerned with improving the wellbeing of older workers and retirees who have been exposed to increased risks of suffering from isolation and loneliness due to the negative effects of the pandemic. Local councils and care providers should encourage retirees to maintain an active lifestyle to improve their quality of life.

During the pandemic, this can be achieved by investing in local libraries that can offer different IT training courses to show older people how they can safely engage in different activities online. Also, local councils should provide more financial support to charities that support older people by means of providing care at their homes and organising online events where retirees can meet and socialise safely.

Kristina Potocnik is Senior Lecturer in Human Resource Management at the University of Edinburgh Business School

Read the Study

World of Work