QUALITY of life for the UK's 21 million over-50s is worsening as they suffer falling income, rising inflation and higher unemployment, according to a comprehensive study launched yesterday.

The report from over-50s financial services specialist Saga, now led by pensions campaigner Dr Ros Altmann, warns that economic growth will be stifled unless the needs of the older generation are addressed by government.

Based on data from the Centre for Economic and Business Research and a Populus survey of 10,000 over-50s, the Saga Quarterly Report is "the first authoritative study to combine serious economic analysis with evidence on well-being, happiness, worries and living standards of over-50s" and says it has uncovered "a bleak picture".

The supposedly gilded generation of "baby-boomers" reports being increasingly worried about the cost of living. Hardest hit are 50 to 59-year-olds, and the lower socioeconomic groups across all over-50 age bands are suffering disproportionately.

Dr Altmann said: "There are 21 million over-50s in Britain, and if they're cutting back on spending it could have massive implications for the economy.

"The general view is that low interest rates don't do any harm … there are a lot more savers than borrowers but policymakers seem to be more worried about the borrowers."

Inflation is higher for 50 to 64- year-olds than for the rest of the population, and unemployment is up by almost 70% in the past two years, compared with a 55% rise across all age groups.

Long-term unemployment has hit the over-50s hardest, with 43% on the dole for more than a year compared to 27% of 18 to 24-year-olds.

The rising cost of living is the silver spenders' biggest worry, with 63% more concerned than they were a year ago, while falling income from savings worries over half (54%) of over-50s.

Nearly half have cut down on discretionary spending such as eating out and holidays.

"People sometimes paint the older generation as 'the lucky ones' with fewer problems than others – the evidence does not support this," Dr Altmann said.

"Some are fine, but the majority are currently struggling and the worst affected are those just short of retirement.

"Their pensions will not deliver the income they were expecting, their savings income has evaporated and more are losing their jobs. Once out of work, they find it hard to get back in. In short, their lives may never recover, but their plight has so far been ignored."

On unemployment, Dr Altmann said: "If the over-50s are increasingly locked out of the labour market, measures to increase the state pension age too rapidly could do more harm than good."

Charles Davis, economist at CEBR, said: "As the UK's population of people over 50 continues to grow it is imperative their concerns are understood."