Is it better for the economy to lower the retirement age?
So that the new graduates or the younger entrants to the labor force can be employed. Is this better in the long run? One disadvantage to this is that it might depressed the retirement fund because the elderly will collect pension earlier, but at the same time the unemployment rate will go down. Do you agree or disagree?
The problem is far more complex than that. For example just because someone retirees doesn't mean that someone who recently graduated is qualified to accept their position. In fact a big part of the unemployment problem is structural and not all cyclical. There are alot of jobs in the marketplace available that are not being filled because the people to fill them are not trained in the proper skills. Companies like Microsoft import hundreds of software engineers from otehr countries because they can't get the skilled labor in the US. That's just one example of the complexity. I wish it was that simple but it isn't.
Thanks for your comment, I see that there is a mismatch of skills and available jobs too.
Funny that you asked this, CNBC just Interestingly referenced a sudy that was released that said when baby boomers work later their consumption from higher income goes up and actually produces more jobs in totality. I have not actually read the study
I would look at the issue from the perspective of giving and taking.
As soon as someone retires, that person will no more contribute to the economic community. It doesn´t matter that he/she collects public funded pensions, a life insurance or lives on Wall Street investments, he/she then only takes from the economy.
Young people have to work. They contribute to the overall wealth of the economic community. If that value add (after depreciation...) of the working people does not allow the older people to retire, then there is no other way than older people to retire later, no matter if there is high or low unemployment. In average people have to retire at an age that balances the inputs (from the working people) with the output (to the retired people).
Keep in mind, consuming is not producing, so certainly pensioners consume, but they don´t produce. And wealth only comes from producing, not from consuming, but that should be common sense.
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