A new report from Statistic Canada, Retirement, health and employment among those 55 plus, gives insight into why people are retiring, how they are paying for retirement and why they return to work—helpful information for employers doing workforce planning.
The study broke retirees into four categories. The “never-retired” are those 55 plus and currently working, having never retired from a job. The “partially retired” are self-reported as such and presumably only work occasionally. “Retired” refers to those who report themselves as completely retired and receiving 50% or more of their total income from retirement income sources such as old age Security (OAS) and the Guaranteed Income Supplement (GIS), the Canada Pension Plan or the Quebec Pension Plan, retirement pensions or personal savings. “Returned workers” are currently in the labour force, but indicate that they had previously been retired.
Why people retire
The study asked the retired group, the partially retired and the returnees why, from 11 different options, they decided to retire.
The most common reasons given by all groups was that it was financially possible, they had completed required years of service and they wanted to stop work.
Twenty-four percent of the fully retired stop working for health/disability reasons, whereas 16% of the partially retired and 14% of the returnees did so.
Organizational restructuring was the reason given by 17% of those for their initial retirement before returning to the workforce. Only 8% of the retired group said they left the workforce because of employer incentive. That number rose to 15% for those who returned to work and 19% for the partially retired.
How are they paying for it?
The main source of income differs significantly among the four groups examined in the study. Not surprising, almost 80% of those who have returned to work reported earnings as their main source of income. For those who are retired, 70% said savings and pension benefits were their main source of income. Government transfers such as OAS and GIS only accounted for 26%.
Why are people returning to work?
The top reasons given by those who have retired and rejoined the workforce was simply that they like working and wanted to be active (52%). However, 52% also said they returned to work for financial reasons. Twenty-nine percent said they returned to the workforce because they didn’t like retirement and 30% did so because of an interesting work opportunity.
This could be helpful data for employer that are in need of keeping their older working population on the payroll longer to aid in knowledge transfer. But it also gives some insight into how well prepared—both financially and socially—employees actually are for retirement.