Magazine article The Futurist

Keeping Older Workers on the Job. (Trend Analysis)

Magazine article The Futurist

Keeping Older Workers on the Job. (Trend Analysis)

Article excerpt

Governments in many developed countries are seeking ways to keep aging populations from becoming a drain on future national resources. With fewer workers providing benefits for greater numbers of retirees, the push is on to keep older workers working. This brief analysis examines what is behind this trend and what some of its implications may be.

Background: A recent U.S. General Accounting Office report summarizes the retirement policy reforms initiated in Japan, Sweden, and the United Kingdom. Japan, facing the most severe aging trend, has enacted substantial benefit cuts to its national pension system, which will require some workers to work to later ages. Sweden changed the entire structure of its social security system from "pay-as-you-go" to a defined benefit plan (where the pensions that retirees receive depend on what they put into the system). The United Kingdom is phasing in a higher pension eligibility age for women, making it equal to that of men (65). The new system will also reward people who stay on the job longer with higher pensions when they do retire.

Demography: Life expectancy at birth in the more-developed countries is projected to increase from 75.8 years currently to 81.6 by 2050, according to UN data. This will raise the median age of the population to well over 50 in Japan and Sweden by 2050, and to about 47 in the United Kingdom. In the United States, median age will grow from about 35 in 2000 to over 40 in 2050. The trend is now expanding to Latin America, where the number of people age 65 or older is projected to more than double between 2000 and 2025-and then double again by 2050, according to the Population Reference Bureau. …

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