People are avoiding retirement because of low interest rates. Who can blame them?

‘Bank of England says that migrants are holding down wages’ the headlines screamed this morning. Yet Mark Carney, when interviewed on the Today programme this morning, spun a slightly different story. Migrants bear some responsibility for downwards pressure on wages, he said, but not so much as another group of people: British workers in the 50s and 60s who are returning from retirement, or who never retired in the first place. Over the past two years, net migration is up by 50,000, but that number is dwarfed by 300,000 people whom the Bank of England would normally have expected to have retired by now, but who have carried on in the workplace. In addition, workers are wanting to work extra hours – equivalent to having an extra 200,000 to 300,000 people in the workforce. In other words, labour rates are being kept down chiefly because British workers are boosting the supply of labour faster than the economy can create jobs.