As part of broader austerity measures, the French government is raising the age of retirement from 60 to 62. The move has drawn sharp protest from labor unions and the country's socialist party. There have also been demonstrations. Though to American observers, many of whom face a retirement age of 66 or 67, the heated reaction may seem a bit comical, there are some serious arguments behind the objections.
- Seems Reasonable "I was unaware that the retirement age in France was that low," comments political science professor Steven Taylor at Outside the Beltway. Still, he points out that "if workers were expecting a specific number the reaction is not that surprising insofar as they will see it simply as a reduction in promised benefits."
- Au Contraire French paper Le Monde runs a twelve-author op-ed railing about the "violence of neoliberal capitalism" and the effect on "those who have already been broken by a long life of work." The authors complain that the attempt to address the ailing economy with policies aimed at shifting demographics is misguided. "The forced work of seniors will replace youth employment in the absence of sufficient job creation, and above all increasing the individual duration of work."
- Exploring the Effects of Delayed Retirement The Economist's Free Exchange blog says the European "belief that the number of jobs is fixed, so that if you remove old people from the labour force, it makes way for younger workers" is "persistent, but wrong." Increasing the number of workers can, paradoxically, increase the demand for workers: "More workers means more income, resulting in a greater demand for goods and services ... Indeed, an influx of women into the labour force didn't reduce male employment or wages." That makes increasing the retirement age, "from a fiscal perspective ... a no-brainer," lowering payouts and "increas[ing] the tax base." On the other hand, though, older workers are less productive and yet more expensive for firms to keep on.
keeping people in the labour force longer may mean rethinking what retirement means. Rather than a discrete and sudden exit retirement may become more gradual. Phasing people out--perhaps by offering the option of part-time work in the years leading up to retirement, may make sense. That may be easier on people who work well into old-age, as it puts them under less physical strain and it eases the mental transition into retirement. More part-time work also allows firms to pay these workers less than their full salary.