As Greece is aging demographically, the retirement age will rise in the not so distant future, according to a recent study by the National Actuarial Authority.
The study, that was submitted to the European Commission, also shows that the Greek population will shrink dramatically. In 2014, the population in Greece was 11.045 million and it will drop to 8.5 million in 2060. By then, six out of 10 Greeks will be over the age of 65 and one in four between 65 and 74 will still be working.
The average retirement age will be 71.9 years then and auxiliary pensions will shrink or disappear altogether. It is estimated that the replacement rate for pension spending will drop from 80 percent today to 56 percent by 2060, with the decline starting no later than 2020, when the rate will reach 64.6 percent. These figures will also depend on possible claims on the reserves of pension funds by the government.
The population decline will be mainly due to a decrease in net immigration up to 2030. This will double the rate of the active population aged above 65 years old from three in 10 today to six in 10 by 2060. In turn, elderly workers will choose to stay in employment. While in 2013 just 4.9 percent of the workforce was aged between 65 and 74 years old, by 2030 this is estimated to rise to 14.3 percent before climbing to 24.4 percent in 2060.
The study further shows that in 2026 the average age of the country’s workforce will be 44 years old, compared 39 as it stands today. The average age of entry in the labor market will remain stable at 22.4 for men and at 24.7 for women, but due to recent changes in retirement age thresholds the average age for retirement for men will rise from 61 years old in 2013 to 64.9 in 2020, 65.9 in 2030 and 67.5 in 2060. For women it is projected to increase from 61.2 years old in 2013 to 65.5 in 2030 and to 67.1 by 2060.