By making post-retirement employment less attractive, the government hopes to encourage older workers to extend their careers and generate savings for the pension system. As HR directors of major companies, you believe this measure will instead harm economic activity. Why?
The government’s intentions are commendable. We need to reduce public spending, and we do not dispute that. However, we believe that discouraging work during retirement in order to encourage seniors to extend their careers is a miscalculation that will ultimately be detrimental to the economy. Retirees who remain active earn a little more money, spend more, and contribute to economic activity in general. Tightening the rules on post-retirement employment runs counter to the direction society has been moving regarding the role of older workers in professional life. The most likely effect of this change will not be delayed retirement, but rather a complete withdrawal from work, because in practice the vast majority of employees claim their pension as soon as they qualify for a full-rate pension.
