GLOBAL - Unless policies for older workers change, GDP growth per capita in its members' areas could shrink to 1.7% per year over the next three decades, 30% below the average annual rates between 1970 and 2000, the Organisation for Economic Co-operation and Development (OECD) has argued.
The findings, to be discussed at a forum on ageing and employment policies in Brussels later this month, emerged from an OECD review of policies to promote the employment of older workers across 21 of its member countries.
The research has shown that fewer than 60% of people aged between 50 and 64 have a job, compared with 75% of people in the 25 to 49 age group.
“If there is no change in work patterns, the ratio of older inactive persons per worker will almost double in the OECD area over the next decades, from around 38% in 2000 to just over 70% in 2050,” the organisation warned.
“We can no longer afford to waste the valuable resources that older workers offer to business, the economy and society.”
The OECD said that, at present, many public policies and workplace practices discourage older people from carrying on working, a situation which it warned would lead to higher taxes and/or lower benefits, coupled with slower economic growth.
“Such policies and practices are relics of a bygone age and unsustainable at a time when population ageing is straining public finances and holding back higher living standards,” the organisation continued.
To promote age-friendly employment policies, the OECD has suggested that governments ensure pensions and other welfare arrangements encourage rather than discourage work at older ages, and that adequate resources are devoted to help older job seekers find a new job.
Employers must end discrimination and adapt work practices to an age-diverse workforce, cautioned the OECD. It also said the practice of mandatory retirement was inconsistent with the general objective of providing greater choice to older workers on when to retire. In a third suggestion, the organisation advised older workers to change their attitudes towards working longer and acquiring new skills.
The 21 countries surveyed include Australia, Japan, Austria, Korea, Belgium, Luxembourg, Canada, Czech Republic, Netherlands, Norway, Denmark, Spain, Finland, Sweden, France, Switzerland, Germany, the UK, the US, Ireland, and Italy.
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The Pension Protection Fund (PPF) is consulting on changes to the actuarial assumptions it uses in valuations in a bid to better reflect the bulk annuity market, with schemes set to move into surplus on aggregate.
Private sector defined benefit (DB) schemes were 96.3% funded on a Pension Protection Fund (PPF) compensation basis at the end of July, according to the lifeboat fund's monthly index.
Conduent has completed the sale of its actuarial and human resource consulting business to private equity investor, H.I.G. Capital.