Friday, February 17, 2012

Retirement age is a big part of the "European Problem"

The story of the Greek secretary, employed by the state, who can retire when she is 51 years old has done more than most things to harden the views of Germans against funding the Greek deficit. Who know if this story is correct? We do know there is a north south divide in how long Europeans work.

In Sweden more than 70% of people aged 55 to 64 still work. In France and Italy the figure is under 40%.

Sweden and Italy share a statutory retirement age for men of 65, but the Scandinavians actually stop work on average at 66 – five years later than their Mediterranean counterparts. As a result, Italy spends 14% of its economic output on pensions, double what Sweden - according to the OECD.

It doesn't take an economics genius to see that this early retirement culture / expectation in the southern countries cannot continue.

Implications of rapidly delaying the age until people receive their pensions - a lot of older people who are economically unprepared to retire who are retiring in countries with few spare jobs. Not good.

Hopefully, you don't need me to tell you but the split of populations into haves and have nothings (ultra-fragmentation) is accelerating and marketers should be adapting to profit from the trend. Dick Stroud

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