Increasing the employment rate for the over 55s
A Second Open Letter to the Leaders of Belgium’s political and economic future:
AmCham Belgium recommends that the future government takes timely decisions to retain more people over the age of 55 in the workforce.
Our recommendations to the new government are the following:
- Make the pension bonus system more effective, by increasing the benefits, granting €1.250 extra pension (per year) for each year worked beyond the age of 60.
- Communicate such a measure effectively.
- Reduce, and ultimately make it illegal, to offer a “bridging” pension, or a similar fiscal benefit, to anyone less than 60.
The US-Belgian business community’s message for the new government is loud and clear: not addressing this issue fundamentally will make it impossible for the government to balance its (social security) budget going forward, for two reasons:
- Firstly, people are living longer so pensions are payable over a longer period.
- Secondly, population demographics are shifting with fewer younger people to contribute to the social security budget.
At the same time business will find it virtually impossible to fill many critical staff positions unless people over the age of 55 are motivated to work for longer.
Older workers have experience and knowledge which makes them an invaluable, though all too frequently under used, resource. Belgium faces a major challenge in increasing the employment rate among older workers. Just 34% of people aged 55 and over still work in Belgium. This is the second lowest in Europe, much lower than the 70% participation rate in Sweden or Norway.
AmCham Belgium believes that implementing bold measures such as these is essential if the steady decline in foreign investment activity into Belgium is to stop. This issue has recently been widely covered in the media as a result of some eye catching corporate reorganizations where employees as young as 52 are offered “bridging” pensions. The US-Belgian business community represents a significant percentage of the workforce and their need for experienced and knowledgeable talent at reasonable cost will more than ever determine where future investments are made.
Scott Beardsley
President
AmCham Belgium