Will millions of Britons never be able to retire?

23 October 2012

"Millions must work forever"

Daily Express, 23 October 2012 

"Millions working themselves into the grave, say studies"

Evening Standard, 23 October 2012

Also reported by BBC News, ThisIsMoney and Daily Star.

If today's newspapers are to be believed, millions of Britons will be forced to keep working until they die (and beyond, according to the Daily Express).

The Daily Express and the Evening Standard, among others, claim that many people will be unable to retire because they don't have enough in the way of savings. 

In generating their headlines, both newspapers have drawn on a new survey produced by NFU Mutual, an insurance and pension services provider.

However, it quickly becomes clear that the headlines are not in sync with the detail of the study. In fact, there appears to be a sharp revision of the numbers.

In its first paragraph, the Daily Express declares, "Nearly 1.5 million people who are over 65 still work. And more than half of them say they have no option but to carry on as they do not have sufficient savings". Meanwhile, the Evening Standard opens its article with the claim, "Around half a million people will never retire".

So we're no longer talking millions of people unable to retire, but 750,000 (according to the Daily Express' calculation) or 500,000.

If we read on, we encounter further problems.

What does the original survey say?

We approached NFU Mutual and its PR agency and requested a copy of the press release sent out to journalists. We also asked to see the data underlying the study.

NFU Mutual and its partners surveyed 1300 adults of all ages (weighted according to population statistics) and asked them about their attitudes to retirement. Of the 1300 interviewed, 273 were aged 65 or over. Of these, 38 (14%) said that they were in full-time or part-time employment. And 15 (39%) of the 38 claimed that they "(did) not expect to retire at all".

NFU Mutual extrapolated these numbers to calculate figures for the population as a whole. According to the Office for National Statistics, there are 10,043,900 people aged 65 and over in Great Britain. Based on the survey's "nationally representative" findings, this would mean that 1,406,146 people (14%) are still working. Of this 1.4 million, 548,396 people (39%) "do not expect to retire at all". This probably explains how the Evening Standard arrived at its claim that "500,000 people will never retire". 

NFU Mutual also state that more than half (57%) of all those planning to delay their retirement "blamed a lack of retirement savings and investment income". This statistic refers to the 158 people who indicated that they would retire after age 70 or not at all.

While 57% of all those surveyed who are delaying their retirement feel unable to retire, the NFU Mutual press release also makes clear that "a similar number" didn't like the idea of giving up work. 52% identified most with the statement, "I can't imagine a time when I would want to stop working". (From the survey data, it looks like participants were able to identify with more than one statement - as the survey results do not add up to 100%.)

Are the newspapers reporting accurate numbers?

The Daily Express misuses the 57% statistic as if it applies to all those aged 65 and over in work (1,406,146 people), whereas in fact it only refers to the proportion who said they were delaying their retirement. This leads the newspaper to mistakenly conclude that some 750,000 of those aged 65 and over "say they have no option but to carry on as they do not have sufficient savings".

Both newspapers have exaggerated the findings of the study, reporting that there are millions who are unable to retire when in fact the figure is in the hundreds of thousands. Tellingly, it now appears that the Evening Standard has corrected its headline to read, "Brits working themselves into the grave, say studies".

What's more, most of the outlets failed to report the fact that 52% of those who planned to postpone their retirement said that they didn't want to give up work.

However, there is a more deep-rooted problem: the data that underpins the press release. While NFU Mutual's sample size of 1300 individuals is adequate and can be extrapolated to provide figures applying to the entire population, the size of some of the sub-sets is too small.

The 500,000 figure quoted by some of the publications is based on a sample of only 15 responses out of a total of 38 over 65s who are currently employed. This sample is not nearly large enough for anyone to draw a meaningful conclusion.

The survey also finds from a relatively small cross-break that 14% of the over-65s sampled are in work. While this isn't far off official statistics from the ONS showing that 12% of men and 12.5% of women over 65 are in work, its difficult to see why the official figures haven't been used in the first place.

We are therefore presented with a bleak outlook that the data can't support. We will be asking the outlets concerned to correct their articles.

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