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SUMMARY OF FINDINGS


OVERVIEW

The 2006-07 Multi-Purpose Household Survey (MPHS) revealed that of the 7.4 million people aged 45 years and over who had, at some time, worked for two weeks or more, 4 million (54%) were in the labour force, 3.1 million (42%) had retired from the labour force, and the remaining 329,400 (4%) were not currently in the labour force but had not retired.

The likelihood of being retired increased with age. For those aged 45-49 years, just 6% were retired, compared to 23% of 55-59 year olds, 75% of 65-69 year olds and 95% of those aged 70 years and over.

Persons aged 45 years and over, Labour force and retirement status - by age

In 2006-07, 59% of men aged 45 years and over were in the labour force, 37% had retired, and 4% were not in the labour force but had not yet retired. In contrast, 48% of women aged 45 years and over were in the labour force, 47% had retired and the remaining 5% were not in the labour force but had not yet retired.

Persons aged 45 years and over, Labour force and retirement status - by sex

Age at retirement

It is important to note that data on retirement age presented in this publication only refer to 'surviving' retirees aged 45 years and over in 2006-07. Therefore, the distribution of retirement age in this population is not representative of the age at which all people retire. For example, based on Australian life expectancy, a person who retired aged 40 years in 1981-82 (aged 65 years in 2006-07) would more likely be alive to participate in this survey than a person who retired aged 65 years in 1981-82 (aged 90 years in 2006-07). This effect will be more pronounced for estimates presented in relation to people who retired a long time ago, but will have some affect on all estimates, particularly as 34% of the retired population included in this publication retired more than 20 years ago.

The average age at retirement from the labour force for people aged 45 years and over in 2006-07 was 52 years (58 years for men and 48 years for women). Of the 1.4 million men who had retired from the labour force:

• 53% had retired aged 55-64 years;
• 27% had retired aged less than 55 years; and
• 20% had retired aged 65 years and over.

• 58% had retired aged less than 55 years;
• 35% had retired aged 55-64 years; and
• 7% had retired aged 65 years and over.

Persons retired from the Labour Force, Age at retirement (years) - by sex

Reasons for ceasing last job

Of the 2 million retired people who had worked in the last 20 years, 96% had held a full-time job at some stage. For just over three-quarters (76%) of those who held a full-time job, their last job held prior to retirement was full time. The remainder worked part time before retiring.

Among both retired men and women whose last job was less than 20 years ago, the most commonly reported main reason for ceasing their last job was 'reached retirement age/eligible for superannuation/pension' (42% of men and 28% of women). These people had one of the highest average retirement ages of 62 years, (63 years for men and 61 years for women). Other commonly reported main reasons given by people for ceasing their last job were 'own sickness, injury or disability' (29% of men and 19% of women) and 'retrenched/ dismissed/no work available' (10% of men and 9% of women).

Persons aged 45 years and over who have retired from the labour force, Selected main reason for ceasing last job - by sex

Persons aged 45 years and over who have retired from the labour force, Selected main source of income at retirement - by sex

Persons aged 45 years and over who have retired from the labour force, Selected main source of current income - by sex

Superannuation scheme membership

Of the 3.1 million people aged 45 years or over who were retired from the labour force, 1.6 million (52%) had made contributions to a superannuation scheme. Men were more likely to have made contributions to a superannuation scheme than women. More than two-thirds (67%) of retired men aged 45 years and over had contributed compared to 41% of women. Of those who had made contributions, 63% had received all or part of their superannuation funds as a lump sum payment (64% of men and 61% of women). Many of those who received a lump sum payment used it to pay off or improve their existing home or purchase a new home (36% of men and 31% of women), to buy or pay off a motor vehicle (17% of men and 11% of women), or clear other outstanding debts (12% of men and 13% of women). Some reinvested their lump sum payment into an approved deposit fund, deferred annuity or other superannuation scheme (22% of men and 14% of women), or a bank account, personal savings or other investment (26% of men and 18% of women).

Of the 1.6 million retired people aged 45 years and over who had contributed to a superannuation scheme, men were more likely to have contributed for a longer period of time than women. Just over half of the men in this group (51%) had contributed for 20 years or more, compared to 22% of women in the same group.

PREVIOUSLY RETIRED

There were 281,100 people aged 45 years and over who had previously retired from the labour force but at the time of the survey were either in the labour force or were planning to look for, or take up, work in the future. Most of this group were women (192,500), and most of these women were in the labour force at the time of survey (160,400).

The most commonly reported reasons for returning to the labour force were 'financial need' (43%), 'bored/needed something to do' (33%), followed by 'interesting opportunity came up' (15%).

INTENTIONS TO RETIRE FROM THE LABOUR FORCE

Of the 4 million people in the labour force aged 45 years and over, 3.2 million (80%) indicated that they intend to retire from the labour force in the future. Of the remaining 791,100 people:

• 398,000 did not know whether they intend to retire from the labour force;
• 379,300 never intend to retire from the labour force; and
• 14,000 were unemployed and had never worked.

Age intends to retire

Of the 3.2 million people in the labour force who indicated that they intend to retire from the labour force, 1.3 million people (or 40%) did not know the age at which they would retire (36% of men and 44% of women). Of those who did indicate an age:

• 11% intend to retire aged 70 years and over (14% of men and 7% of women);
• 38% intend to retire aged 65-69 years (44% of men and 30% of women);
• 33% intend to retire aged 60-64 years (29% of men and 38% of women);
• 16% intend to retire aged 55-59 years (2% of men and 21% of women);and
• 2% intend to retire aged 45-54 years (0.7% of men and 4% of women).

Factors influencing decision about when to retire

For those in the labour force who intend to retire, the most common factors influencing their decision about when they would retire were 'financial security' (44% of men and 41% of women), 'personal health or physical abilities' (40% of men, 40% of women), and 'reaching the eligible age for an old age (or service) pension' (12% of men and 11% of women).

Persons aged 45 years and over who intend to retire from the labour force, Selected factors influencing decision about when to retire - by sex

The second most commonly reported main expected source of income was a 'Government pension or allowance' (22%), and this was reported by 20% of men intending to retire and 24% of women. It is interesting to note that 12% of people aged 45 years and over who intended to retire did not know what their main expected source of income at retirement would be - this was reported by 9% of men and 14% of women. 'Will rely on partner's income' was reported as the main expected source of income at retirement by 13% of women but by less than 1% of men.

Persons aged 45 years and over who intend to retire from the labour force, Selected main expected source of income at retirement - by sex