What does retirement mean in the gig economy era?

Are you looking forward to retirement? It’s a question that used to be fairly easy to answer. But, at a time of uncertain economic futures and rapid growths in self-employment, the whole idea of “not working” in later life is being thrown into question.

What does retirement mean in the gig economy era?

According to research from pension firm Aegon, more than one in four people (27%) think they will be working either full- or part-time at age 70.

Money – or lack thereof – is a key component to this. Last year a survey from the Financial Conduct Authority found that one in three people in the UK have no pension savings, and will have to rely entirely on a state pension in their retirement. That’s £164.35 per week.

Given this economic bleakness, many in Generation X (born between 1960-1980) and the Millennials (born between 1981 and early 2000) are disconnecting from the traditional idea of retirement. Changes to government retirement policy tends to confuse the issue. The moving of state pension age and auto-enrolment – which can give a false impression it will provide enough for a comfortable retirement – when the reality it would only deliver a basic income, often means the public switch off when the subject of pension provision is discussed.

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The number of people living well into older age is also increasing. According to the most recent projections from the Office for National Statistics (ONS), a women’s life expectancy is projected to be 85.1 years by 2026 and 86.6 years by 2036. Men are also projected to live longer, increasing to 82.1 years by 2026 and 83.7 years by 2036.


What is to be done? For many, gig-economy work in later life could become a reality. In their report Gig Economy Workers and the Future of Retirement, investment firm Betterment found that 16% of Americans plan to take a gig job in their retirement. Similar numbers are likely in the UK.

For precedent, look to the increase in “side-hustle work”. According to the Henley Business School, 1 in 4 people are already running a business as a side project, which in total contributes an estimated £72 billion to the UK’s economy.

1 in 4 people are already running a business as a side project

“A side hustle is not always about generating extra income,” says Jonathan Rennie, partner at UK law firm TLT. “It could be that an employee wants to develop supplementary skills that complement their existing work.

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“For example, a web designer might want to set up a business using different coding or programming to what they use normally so that they can broaden their skills and experiment with new technologies and applications that may then ultimately be used in their core job.”

This way of thinking could continue into later life. As the Institute of Directors concluded in their report Age of the Older Entrepreneur, “for those facing the prospect of retirement or leaving lifelong employment, starting a business can also be a great way to continue engaging with work.

“It may not be everyone’s first choice for retirement, but it can keep an individual busy, stimulated and in some cases physically and socially active. For some, it may also be a decision taken out of necessity, such as the requirement for a supplementary income.”

If it’s handled well, developing a flexible portfolio career now could mean retirement becomes an evolution of the work you are already doing. This could be a good thing, not only from a financial standpoint but also in terms of wellbeing. 



What “retirement” actually means today is clearly changing, and this is affecting the workforce as well as individuals. According to Aegon, since 2000 the balance of the workforce has changed. People increasingly delay retirement, or work in a different capacity beyond typical or state pension ages, resulting in a higher number of older workers.

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Semi-retirement is becoming increasingly attractive. According to research from HSBC, more than half (54%) of working age people who plan to retire want to stay in the same job or career but work fewer hours.

Business is becoming acutely aware of the value their older employees bring to their enterprises. Often, employers don’t want to lose the expertise, skills and experience older workers have.

“Many businesses are already aware of the need to retain and recruit older workers. However, with 1.3 million employers in the UK, there are still far more that don’t,” Christopher Brooks, says Senior Policy Manager at Age UK.

“A multi-generational workplace is best for a highly productive, vibrant organisation”

“Research has shown that having a multi-generational workplace is the best way to deliver a highly productive, vibrant organisation, so ensuring that recruitment practices are age-neutral is important for any right-thinking manager.”

A good retirement

Are we heading towards a world without retirement? “The nature of retirement has and will continue to change,” says Dr Boris Altemeyer, chief scientific officer at analytics company Cognisess. “From a personal perspective, we can redefine what work means to us.

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“It might be a combination of flexible working, it could be finally turning a hobby into self-employment, it could be a combination of part-time work, mentoring, volunteering and retirement. There are no set rules any longer.”

Retirement can still, of course, mean stopping work altogether, but for a growing number, retirement is being redefined as something that is just one stage in your life – a stage that could enable you to take a different path to increased levels of wellbeing and financial security. Whether it’s developing a ‘side hustle’ or opting for semi-retirement, a key takeaway is that it’s crucial for workers to nurture different options for their autumn years.

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