The Office for National Statistics (ONS) has warned that the exit of workers aged between 50 and 65 from the workforce could negatively impact both individuals’ finances and the wider economy.

The organisation’s Living longer: impact of working from home on older workers study estimated that if the employment rate of people in the age group matched that of those aged 35 to 49 years, it would add more than 5 per cent to UK gross domestic product (GDP), equating to around £88bn.

The research pointed towards continued flexible working as a way to keep older workers in employment, noting that previous research from June and July 2020 had found that those who were working entirely from home were more likely to say they were planning to retire later (11 per cent) compared with those who were still having to deal with a commute (5 per cent).

It also noted that its prior research had found that older workers aged 50 to 69 who were working from home thought it improved their work life balance and well-being, while people with long-term conditions were also found to be less likely to plan for early retirement if they were working from home.

Accordingly, the proportion of older workers who planned to work from home after the pandemic was 22 per cent, which ONS said was above pre-pandemic levels.

The report also identified strong differences between when people stopped working along gender lines, noting that 17.9 per cent of 50 year old women were economically inactive, compared with 9.6 per cent of men the same age.

Meanwhile, at age 64, 58.6 per cent of women were economically inactive, compared to 44.9 per cent of men.

Hargreaves Lansdown senior pensions and retirement analyst, Helen Morrissey, said: “Anything that enables people to stay in work for longer and benefit from increased income and pension contributions is welcome. Leaving the workforce early can have an enormous effect on someone’s financial resilience in retirement as well as their physical and mental wellbeing.

Read more @Pension Age