Thursday, May 24, 2018

European Commission Recommends that Luxembourg Work To Increase Employment Rate of Older Workers

The European Commission's 2018 Country-Specific Recommendation (CSR’s) on Luxembourg call for increasing "the employment rate of older people by enhancing their employment opportunities and employability while further limiting early retirement, with a view to also improving the long-term sustainability of the pension system."

According to the Commission:
The employment rate of older people remains particularly low and further measures
are needed to improve their employability and labour market opportunities. This is
also important to ensure the long-term sustainability of public finances. Early
retirement schemes encouraging workers to leave employment remain widespread,
with 59.2 % of newly attributed pensions being early old-age pensions. A law
suppressing one early retirement scheme was passed in December 2017 but its net
impact on the average effective retirement age and on expenditure is uncertain as it
eases conditions on other early retirement schemes. This poor labour market outcome
can also be partly attributed to financial disincentives to work, which are
comparatively high for this group. Encouraging the employment of older workers
requires a comprehensive strategy including measures to help workers remain in active
employment for longer. The ‘Age Pact’, a draft law submitted to Parliament in April
2014, which aims to encourage firms with more than 150 employees to hire and retain
older workers through age management measures, is still pending in Parliament. As
regards education, Luxembourg needs to address the strong impact of students'
socioeconomic background on their education outcomes. This is also important to
respond to the strong demand for highly specialised skills.
Additional Source: Luxembourg Times "Brussels urges Luxembourg to create jobs for older workers" (May 23, 2018)

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