Retirement age

Denmark will have the highest retirement age in Europe after the Danish Parliament passed a law raising the retirement age to 70 by 2040, on Thursday, the 22nd of May, reports the British broadcaster BBC. The new retirement age of 70 will apply to everyone born after the 31st of December 1970. The new law was passed on Thursday by 81 votes to 21. Since 2006, Denmark has linked the official retirement age to life expectancy and reviews it every five years. It is currently 67, but will rise to 68 in 2030 and 69 in 2035. However, last year, Social Democrat Prime Minister Mette Frederiksen announced that the principle of automatically raising the retirement age in line with life expectancy should be negotiated. “We no longer believe that the retirement age should automatically increase,” she said, adding that her party believes that “we cannot simply continue to say that people should work another year longer”. Roofer Tommas Jensen, 47, called the retirement changes “unjustified”, saying they would burden workers like him. “We work and work and work, but we cannot go on forever,” he told Danish media, adding: “I have paid taxes all my life. I should also have time to spend with my children and grandchildren.” In recent weeks, there have been trade union-backed protests in Copenhagen against the raising of the retirement age. Jesper Ettrup Rasmussen, head of the Danish trade union group, called the plan to raise the retirement age “totally unfair”, pointing out that Denmark already has “the highest retirement age in the EU”. HE WARNED THAT IT WOULD DENY PEOPLE “THE RIGHT TO A DIGNIFIED RETIREMENT”. Retirement ages vary across Europe. Many governments have raised the retirement age in recent years on the basis of longer life expectancy and to tackle budget deficits. In Sweden, retirement benefits can be claimed no earlier than age 63. In Italy, the standard retirement age is 67, although, as in Denmark, it is adjusted on the basis of life expectancy estimates and may increase in 2026. In the United Kingdom, persons born between the 6th of October 1954 and the 5th of April 1960 start receiving a pension at the age of 66. But for people born after this date, the state pension age increases gradually. In France, a law was passed in 2023 raising the retirement age from 62 to 64. This very unpopular change led to protests and riots, and President Emmanuel Macron had to push it through Parliament without a vote. Also read: Russia closes Moscow airports for third night in a row due to Ukrainian drone strikes Follow us on Facebook and X! The post Denmark to raise retirement age to highest in Europe appeared first on Baltic News Network.

The brief’s key findings are: Since the mid-1990s, the average retirement age has risen by three years. The question is, to what extent has working longer translated into delayed claiming of Social Security benefits? Two metrics are relevant here: 1) the share of all initial claimants who are age 62; and 2) the share of all workers turning age 62 who claim at 62. Both show a steep drop in the share of people claiming at 62 over the past two decades, a trend that continued even through COVID. As a result, the average claiming age has risen during this period by about two years, somewhat less than the average retirement age. Introduction  Working longer – when possible – has been generally accepted as good advice for a secure retirement.  It directly increases current income; it allows people to contribute more to their 401(k)s; it shortens the period of retirement; and, importantly, delaying claiming of Social Security results in a much higher monthly benefit.  The good news is that people have responded; the long-term trend toward earlier retirement came to a halt in the mid-1980s, labor force participation rates at older ages began to increase in the mid-1990s, and since then the average retirement age has increased by three years.  The question is the extent to which working longer has translated into delayed claiming of Social Security benefits.   Some information can be gleaned from the claims data published annually by the U.S. Social Security Administration (SSA).  These data show, for all workers claiming benefits in a given year, the percentage who are ages 62, 63, 64, etc., which is informative for any given year.  But when the size of the group turning 62 is increasing substantially each year, the claims data underestimate the trend toward later claiming.  That is, the data will show age-62 claimants making up a larger portion of total new claimants in a given year even if a smaller percentage of those age 62 claim immediately.  To accurately follow claiming behavior over time, one must look at cohort data.  Such data show, of the potential claimants turning 62 in a given year, the percentage who claim as soon as possible.  This brief uses both sources of data to look at the short-term – pre- and post-COVID – and long-term trends in claiming.   The discussion proceeds as follows.  The first section uses the annual claims data to document the change in claiming from 2019 to 2023 and the percentage claiming at 62 from 1985-2023.  The second section describes the change beginning in the mid-1990s in the number of people turning 62 each year and discusses how this “cohort effect” exaggerates the number claiming at 62 in the published numbers.  It also notes that, recently, 62-year-olds have stabilized as a share of the population so shifting sizes of age groups is not distorting current comparisons going forward.  But birth-year data are essential for any historical comparisons, so the third section compares from 1985 to 2023 the claim-age and birth-year data for claiming at age 62 and the average claiming age using the two sources of data.  The final section concludes that, no matter what the data source, people are delaying claiming, although the two-year increase in the average claiming age from 63 to 65 falls slightly short of the three-year increase in the average retirement age.    Data by Claim Year Much has been written about the impact of COVID on the work patterns of older adults.  The consensus was that while the pandemic pushed many older adults out of work, it did not result in earlier self-reported retirement or Social Security claiming.1  Indeed, the distribution of both men and women by claiming age supports that early assessment.  Of those claiming benefits in 2019 and 2023, a smaller share of both men and women claimed at age 62, and a much larger share claimed at ages 67+ (see Figures 1a and 1b).  These same data can be used to create a historical record of early claiming for the period 1985-2023 (see Figure 2).  Over that time, despite the bias created by rapidly increasing numbers of 62-year-olds, the percentage claiming early began to drop in 2005 – declining from around 60 percent to less than 30 percent.   The problem with this figure is that the pattern is inconsistent with the fact that the uptick in work effort actually began in the mid-1990s not in 2005.  The inconsistency arises because the number of people turning age 62 started to increase dramatically in 1997, making the claim-year data look like many were opting for early claiming – the so-called “cohort” effect.2 The “Cohort” Effect An example provides the intuition behind the “cohort” effect.  Suppose that beneficiaries can only claim at age 62 or 63 and that 55 percent of all people born in any given year will claim at age 62 and the other 45 percent will claim the following year when they turn 63.  If the number of people who attain ages 62 and 63 remains constant from one year to the next, then the SSA published data on claim year and the cohort data will tell the same story.  If, instead, the number of people attaining age 62 grows by 10 percent in a given year, then the SSA published data will show that 57 percent of people who claim benefits each year are age 62 and that 43 percent are age 63.3  In this case, the SSA published data will exceed the unchanged claiming rate at 62 for each cohort. In fact, the number of individuals turning 62 began to increase significantly around 1997.  Between 1997 and 2023, the annual flow more than doubled from 2.0 million to 4.3 million (see Figure 3).  The increase dramatically altered the age structure of the population eligible for retirement benefits. The only way to isolate the behavior of, say, 62-year-olds is to determine the percentage of all individuals born in a given year who claimed retired worker benefits at 62.  The calculation is possible because SSA has unpublished data on the number of people eligible for retired-worker benefits by birth year.  The task is then to allocate cohort totals among claiming ages based on SSA’s published data.4   Before reporting the results by birth year, it should be noted that the “cohort effect” is only relevant for evaluating long-term trends.  The share of 62-year-olds among those 62-70 has now returned to roughly 12 percent of the total (see Figure 4), which means that, currently, the published data by claim age will provide a meaningful depiction of claiming trends.  That is, the published data for claiming between 2019 and 2023 do not include any cohort effects.  For a historical perspective, however, the birth-year data remain essential. Comparing Results by Claim Year and Birth Year   Figure 5 compares the percentage of men claiming at age 62 on a claim-year and birth-year (cohort) basis.  The two approaches provide very similar results until 1997; afterward, the two series start to diverge.  The cohort data reflect the uptick in labor force activity beginning in the mid-1990s – with longer work lives leading to later claiming – and show a much larger decline over the last three decades than the claim-age data. Figure 6 shows the trend from 1985-2023 in the average claiming age for men on a claim-year and birth-year basis (those cohorts turning 62 after 2015 do not reach age 70 by 2023).  As one would expect, the increase is larger using the birth-year data, but both support the contention that the delay in retirement has been accompanied by a delay in claiming.  The delay in claiming, however – even using the birth-year data – is only about two years – slightly less than the three-year increase in the average retirement age.5 Conclusion The good news is that, prior to COVID, the trend over the last 20 years showed a dramatic decline in the percentage of 62-year-olds claiming benefits as soon as they became eligible, and that trend continued through COVID.  As a result, the average claiming age has increased, although both the birth-year data and claim-age data show an increase that falls short of the three-year increase in the average retirement age. References Munnell, Alicia H. 2025. “Will the Average Retirement Age Keep Rising?” Issue in Brief 25-8. Chestnut Hill, MA: Center for Retirement Research at Boston College. National Bureau of Economic Research. 2014. “U.S. Census Intercensal Population Estimates.” Cambridge, MA.  Quinby, Laura D., Matthew S. Rutledge, and Gal Wettstein. 2021. “How Has COVID-19 Affected the Labor Force Participation of Older Workers?” Working Paper 2021-13. Chestnut Hill, MA: Center for Retirement Research at Boston College. U.S. Census Bureau. 2025a. “National Population Characteristics: 2010-2019.” Washington, DC. __________. 2025b. “National Population Characteristics: 2020-2024.”  Washington, DC.  __________. 2021a. “National Intercensal Tables: 1900-1990.” Washington, DC. __________. 2021b. “National Intercensal Tables: 2000-2010.” Washington, DC. __________. 2015. “National Population Projections: United States by Age, Sex, Ethnicity and Race for Years 2014-2060” on CDC WONDER Online Database. Washington, DC. U.S. Social Security Administration. 2025. Unpublished Data on Initial Social Security Benefit Awards and Eligibility Status. Baltimore, MD. __________. 2024. Annual Statistical Supplement, 2024. SSA Publication No. 13-11700. Baltimore, MD. Endnotes See Quinby, Rutledge, and Wettstein (2021) and citations therein. ︎ Fertility rates hit a low point in the mid-1930s and then began recovering. This pattern (which preceded the beginning of the baby boom era that started a decade later) led to the surge in people turning 62 in the late 1990s. ︎ The calculation is .57 = (1.1*.55)/(1.1*.55+1.0*.45). ︎ For example, the unpublished data show that 863,753 men born in 1923 turned age 62 and became eligible for benefits in 1985. The published data show 448,630 men claimed benefits at 62 in 1985, all of whom by definition must be 1923-cohort men. Similarly, the published data show that 82,900 men claimed benefits at 63 in 1986, 110,580 claimed at 64 in 1987, etc., so the published data allow one to follow the claiming activity of the 1923 birth cohort over time. When the process is complete, it is possible to calculate the percentage of each cohort claiming at each age. ︎ The average retirement age is measured as the age at which 50 percent of the male population is out of the labor force (see Munnell 2025). The pattern showing that the change in delayed claiming is slightly lower than the change in the average retirement age is not surprising because some people claim benefits before they stop working. ︎

Probably not – most of the drivers have played themselves out. Let’s take a deep breath and step back from the daily news cycle, where the Social Security Administration is under repeated attack, and take a look at recent trends in retirement patterns and what they are likely to look like going forward. Prior to the 1880s, men generally worked as long as they could, and at the end of their lives, they had only about two years of ‘retirement,’ often due to ill health.  Beginning around 1880, however, the percentage of the older male population at work began to decline sharply (see Figure 1).  Experts attribute this decline initially to Civil War pensions, then to rising incomes and the shift from agriculture to employment in large enterprises, and finally to the introduction of Social Security and Medicare. The downward trajectory stopped around the mid-1980s and, since the early 1990s, the labor force participation of men both 55-64 and 65+ has gradually increased. This pattern has led to an increase in the “average retirement age,” defined as the age (in years and months) at which the labor force participation rate drops below 50 percent. Based on this definition, in 2024 the average retirement age for men was 64.6, three years later than in 1994 and almost back to the 1960s (see Figure 2). Many factors probably contributed to this recent increase in the average retirement age.     Social Security: Changes to Social Security made work more attractive relative to retirement. The liberalization, and for those at the Full Retirement Age (FRA) the elimination, of the earnings test removed what many viewed as an impediment to continued work. The increase in the FRA from 65 to 67 reduced benefits for those claiming early. And, the enhanced delayed retirement credit increased incentives to keep working between the FRA and age 70. Pension type: The shift from defined benefit to 401(k) plans eliminated built-in incentives to retire. Moreover, since 401(k) participants bear investment risk, they need to work longer to accumulate a buffer against prematurely exhausting their resources. Education: Better-educated workers have less physically demanding jobs, more employment opportunities, are paid more, and work longer. Improved health and longevity: Average life expectancy for men at 65 has increased about 3.2 years since 1990, and until 2010 the evidence suggested that people were healthier as well. The correlation between health and labor force activity is very strong. Decline of retiree health insurance: The rapid rise in health care costs has been accompanied by a significant decline in employer provision of retiree health insurance.  Hence, workers have a strong incentive to stay working until they qualify for Medicare at 65  Less physically demanding jobs: As manufacturing has declined, the service sector has exploded with knowledge-based opportunities, which put less strain on older bodies. Will the early drivers of delayed retirement continue to have an impact? I would argue ‘no.” All the changes in the Social Security program are now complete. The shift from defined benefit to 401(k) plans in the private sector is now complete. Educational attainment for men has leveled off and will likely level off for women by 2030. Since 2010, estimates for healthy life expectancy at 50 – which combines the disability rate with changes in life expectancy – show actual declines for some groups. Finally, the shift by firms away from offering retiree health benefits is virtually complete. The bottom line is that the factors contributing to the reversal in the labor force participation of older workers appear to have run their course. Their impact will remain, so it is unlikely the average retirement age will decline. On the other hand, they will provide little impetus for increases in the average retirement age.

Abstract The medium- and long-term effects of the COVID-19 pandemic are of continued interest to policymakers, advocates, and academics.  Given the importance of health in decisions to work, earn, and eventually claim OASI benefits, COVID may have long-term effects on programs SSA administers even well after the official end of the pandemic.  To this end, this report examines how COVID has affected the health of Americans, as well as their employment, earnings, and OASI claiming since the onset of the pandemic.  The focus is on two main channels.  First, the pandemic led to disruptions in the supply of healthcare that may have delayed or prevented required care.  Second, infection may have led to an array of post-acute and chronic conditions, so-called long COVID.  To examine these channels, the analysis focuses on mid- to late-career individuals, defined as those who were between the ages of 50 and 75 when the pandemic began in 2020.  It uses rich longitudinal data on health and employment before, during, and after the pandemic from the Health and Retirement Study (HRS), a nationally representative survey of individuals 50 and older, interviewed every two years until death.  The HRS is the preeminent data source for addressing how health and employment evolve over time.  There are a number of principal findings: Almost one-third of individuals in this age group experienced a disruption in their healthcare during the pandemic, with the highest incidence among female, more educated, and single individuals, as well as those with pre-pandemic heart and lung diseases, arthritis, and psychiatric and depressive conditions. After accounting for a wide array of demographic factors, pre-pandemic health, insurance coverage, and pre-pandemic employment status, there is little association between having experienced a healthcare disruption and the likelihood of being employed late in the pandemic. Disruptions in the normal supply of healthcare, which were at the time largely out of the control of individuals, are likely not an important concern for the evolution of employment in the post-pandemic labor market. Sixteen percent of American adults between the ages of 50 and 75 ever had long COVID as of July 2024, with 5 percent currently suffering from the condition. After accounting for a wide array of demographic factors, pre-pandemic health, insurance coverage, and pre-pandemic employment status, female and more educated individuals were more likely to have had long COVID, with Blacks less likely. Those with pre-pandemic heart and lung disease, arthritis, and depressive conditions were more likely as well. Individuals suffering from long COVID were 9 percentage points less likely to be employed late in the pandemic. Roughly half of 50 to 75 year olds were employed in 2018, prior to the pandemic. Therefore, the 9 percentage-point reduction in employment from long COVID is a substantive economic reduction in work. As of 2023, there has been little statistically discernable effect of long COVID on OASDI claiming behavior.