Like many developed countries, Switzerland is facing a long-term demographic crunch that threatens to contract the labor market and undermine social pension funding. So it’s a little surprising that the Swiss Federal Council is considering a proposal that would effectively allow older workers to retire seven years earlier than currently, at the age of 58 – which would presumably just make the problem worse. That’s according to author Marco Salvi at Avenir Suisse, who argues against the idea in a blog post:
- Supporters of the proposed reduction claim it would help cushion older workers against competition from immigrants from other parts of Europe, allowed under the freedom of movement agreement with the EU.
- However there really isn’t much evidence that older Swiss workers need this protection: the rate of employment among older Swiss workers hasn’t decreased since freedom of movement was introduced in 2002, so… why now?
- In fact, older Swiss are more likely to be employed than their younger counterparts.
- There’s also the negative example of Germany, which introduced earlier unemployment for long-term unemployed in the 1970s – only to see a widespread reduction of employment among workers aged 60+. In other words, as Salvi points out, if you give people the chance to exit the labor market comfortably, don’t be surprised when they do.