The Mirz government discusses retirement at age: Millions of people may work longer to secure pensions
Germany is facing a growing crisis in its pension system as the large baby boomer generation retires, while fewer young people are contributing to the system. Unprecedented longevity and an unfavorable worker-to-retiree ratio are increasing pressure on the pension fund.
The Mirz government is considering a major reform to raise the retirement age to 70 years. The pensions committee, led by social law professor Constance Janda, will discuss this proposal, determining which age groups will be affected first. This change aims to extend the working period and stabilize the pension system.
Economist Martin Werding, a committee member, suggested linking the retirement age to life expectancy and gradually increasing it. Starting in 2031, the retirement age will rise by six months every ten years. Although reaching the age of 70 will not occur before 2091, the short- and medium-term benefits include an increase in pension values and a reduction in contribution rates.
Demographic data highlights the need for reform: In 2020, the number of Germans aged 67 and over was 16.7 million, and this number is expected to rise to nearly 21 million by 2040. At the same time, the number of young people entering the labor market is decreasing, worsening the ratio of contributors to retirees and threatening long-term financial stability.
If the retirement age continues to rise at the current rate of two months per year, the first people born in 1982 will be eligible for retirement at age 70. The government plans to present tables showing the retirement age according to the year of birth, to illustrate how this reform will gradually affect future generations.