Financing Longevity

An Ageing European Workforce

The division of life into conventional phases beyond childhood—completion of education, regular work, and retirement—is embodied in social institutions such as the educational system, the labour market, leisure industries, and retirement communities

One may postulate, then, that increased longevity has automatically translated into longer working lives, but that this is not necessarily the case in Europe. For example, the French have amongst the highest longevity in Europe, yet they retire much earlier than many of their fellow Europeans.

After decades of early retirement which has led to a sharp reduction in labor force participation rates among older workers, there is an emerging consensus that if the European Union is to remain competitive, then the working lives of Europeans need to be extended. Examples of the trend include:

• the European Council of Stockholm in 2001 set a target rate of 50 per cent employment for older workers
• at the Barcelona European Council meeting in 2002, an increase of about five years in the effective retirement age was advocated for the EU by 2010
• in 2003, the European Equal Treatment Directive made discrimination on the basis of age (age discrimination) effectively illegal in all aspects of employment practice

Bold Policy Measures and Ambitious Targets

These are bold policy measures and ambitious targets. Only a handful of countries are likely to reach the target employment rates for older workers within the mandated time frame. Nonetheless, this European policy steer has galvanised national governments to explore policies which may help meet the challenges presented by their ageing populations.

The ILC-USA issue brief "The Ageing European Workforce" presents an overview of the situation of older workers across Europe. Drawing mostly on national examples from eight case countries, it aims to help policymakers identify actions that may lead to more equal participation of older workers in our labour markets.

 

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Related Links: Read our Issue Brief, See All Publications on Financing Longevity

Keywords: financing longevity

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