The employment market has been turned on its head by Covid 19, and the media is awash with its consequences.
As many employees pursued new opportunities made more urgent and more lucrative by the pandemic, a labour shortage has effectively been created in many industries, and employers are having to offer much higher salaries to attract talent. As just one example, in the construction industry, recruitment firms are now offering workers up to 25% more than their current salary to take up roles elsewhere, as firms fight over key skills.
And just as this skills shortage is putting the squeeze on the younger end of the employment market and driving wage inflation, it’s also tempting more senior employees into early retirement, creating a skills vacuum at that end of the scale, too.
Taken together, the effect is potentially catastrophic. But from where we’re sitting, catastrophe is not afoot, and opportunities abound.
Filling the Finance void(s)
As we explored in an earlier article, prominent industry commentators, including John Lewis chairwoman Dame Sharon White (reported in the BBC), have urged a rethink around retirement, based around the dual strategy of making it more flexible, and reskilling retired workers to take on the challenge of filling vacant roles
This certainly has merit – however for us, as an organisation of outsourced Finance professionals, what we’re seeing is that there is not one void to fill (the hole left in businesses by departing and retiring workers) but two – the other one being the gap (financial and personal) left in many over-50s’ lives when they retire, or indeed when they retire too soon.
This is more of an issue than many people realise. According to research from Legal and General, 1.3 million people plan to retire early due to the pandemic, but similar research from Aviva points out that 47% of early retirees find their finances take a hit.
But what we’ve also found is that the remedy to these shortfalls, in the eyes of many in our industry, is not to jump out of the frying pan and then back into it again – i.e., retire from full-time employment but then reluctantly re-enter it when needs must – but find a “third way”.
How does this work in practice?
This means turning to a part-time/portfolio career that can deliver substantial income, enables better control over work-life balance, and keeps experienced people active on the kinds of projects that interest them most.
Let’s take our own business – outsourced Finance professionals (we call them Associates) working in their own businesses, through us – as an example.
The reason this works so well is because it meets both the Associates’ and the clients’ needs.
The Associates want flexible, part-time, interim, or project-based work, and they want to choose the clients they work with.
The clients are looking for Finance professionals as and when they need them, and want to pay as they go and only for the elements of the service they use, rather than (particularly in the current climate of labour shortage and wage inflation) footing the salary bill for a full-time, in-house resource. (Average salary of a CFO in the UK? From well over £130,000 in Wales, to £161,000 in London).
There’s no reason why this model can’t work in other disciplines outside Finance, too, and its suitability for those over 50 is proven by the fact that of all of our associates only 4 are under the age of 50 with some still active in their 70’s!
Is this the “new normal” for over-50s?
Nobody has a crystal ball, but of course a major factor in the viability of any life choice or change is how it will impact on or enhance income – and here, the model has proven credibility.
An example from our own organisation: most of our Associates are billing within three months of starting with us, and the earning potential is genuinely unlimited, as they take on the work they want, and they set the price. One of our Associates in particular regularly bills in excess of £100,000 per annum (you can read his story here).
To quote the old saying, “If it pays, it stays” – and as our business has been operating this way for well over 20 years, it looks very much to us like flexible, part-time working for skilled over-50s specialists’ ticks both boxes!
For more information, get in touch.