Consider the type of information contained in the PDFs in your directories and spooled files in your output queues. Aside from taking up disk space and consuming time during a backup, what's the issue with leaving these reports on the system? The issue is the contents of those reports, along with who has access to them.
Robin Tatam has fielded quite a few questions about how to encrypt IBM i data. In this quick video, he outlines your options and explains field procedures (FieldProcs).
If your organization is thinking about using (or is using) IBM's Cryptographic APIs (e.g. QC3ENCDT, Qc3EncryptData) for encrypting database fields, then this article is for you.