EUROPEAN PAPERS ON THE NEW WELFARE

Active Ageing: a core policy priority for the European Union

10. Active ageing after enlargement
Yet, just as the Union could celebrate its first noteworthy advance on the Stockholm and Barcelona goals, the challenge would suddenly increase as an effect of enlargement. Quantatively, the setback was fairly moderate but in many of the new Member States the barriers to active ageing are far more difficult to overcome.
Even if progress was somewhat disappointing in the EU15, it could at least be assumed that Member States in principle would have the capacity for implementing effective active ageing strategies. Presently, this is not necessarily so in most of the New Member States (NMS). As indicated in the table below five of these accounting for about 80% of new population perform very poorly on the active ageing indicators.

Table 3: Active ageing indicators: New Member States vs. average ED-15
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Only about a quarter of the older workers are employed here. In the biggest of the NMS the average exit age is more than 3 years below the figure for EU15. Moreover several of the NMS will be faced with a substantial ageing and shrinking of the workforce over the next two decades. Even more than the old Member States, most NMS — including the better performers — would need to launch the virtuous circle of active ageing practices in order to secure future labour supply and sustain their reformed pension systems. Yet, this may only be possible in the mid-term. Barriers to active ageing in the majority of NMS can be briefly listed as follows:
• The life expectancy, health status, workability and employability of older workers (55-64) are markedly lower than in EU15.
• Working time is higher, work quality lower and health & safety conditions substantially poorer
• There is a long tradition that women retire in their mid-fifties and men around the age of 60, which has a negative effect on attitudes.
• In most NMS the level of social partner organization is low and social dialogue and social partner capacities are underdeveloped.
• Active labour market policies that can address the needs of older workers are not in place or about to emerge.
• The employment content of growth is not yet sufficient to create the surge in labour demand which could boost the employment opportunities of older workers.
• Older workers are particularly threatened by coming restructuring.
When prospects for reaching the Stockholm and Barcelona goals in the enlarged Union were assessed in the latest Joint Employment Report (2004), the text presented the following complicated picture:
“Although employment rates for older workers increased, the target of 50% is a considerable way off. Progress towards the 70% overall Lisbon target will critically depend upon even more rapid increases in the employment of older workers.”
The employment rate of older workers increased to over 40.2% in 2003, compared to 38.8% in 2002. The 50% target has only been reached by six Member States (CY, DK, EE, PT, SE, and UK) and is within reach in a further two (FI and IE).

Table 4. Employment rates of older workers (55-64)
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In the coming years, increases in the employment rate of older workers will partly be caused by a cohort effect, as those born in the post-war baby boom reach the age of 55, thereby increasing the size of the 55-64 age brackets (with more of the starting age).
However, between 2002 and 2003, this cohort effect for the EU as a whole was not particularly important. The employment rate increased for the whole 55-64 age group, regardless of the specific year when individuals were born and in fact the increase was particularly strong for those in their early 60s, especially for men. There was also a marked increase for women aged 55-56.
The average exit age from the labour market has increased by 0.6 for the EU25 between 2002 and 2003, from 60.4 to 61.0 (the corresponding increase for the EU15 was also 0.6 from 60.8 to 61.46). However, progress was mixed, with a decrease in the average exit age in several member states, including the NL, PT, EE, AT, SI and to a lesser extent FI, CZ, ES and SE. On the other side, progress was particularly strong in HU, IE, EL, CY, DK PL and IT. Furthermore, the exit age is still below or close to 59 in SI, SK, PL, BE, MT, AT.
Progress towards the 50% target will essentially depend on further progress in the Member States where the employment rate of older workers is still very low.
Without urgent and drastic measures to strengthen current trends, the EU targets for older workers are out of reach. The employment rate of older workers has increased since 1998, significantly so in FI, NL, HU, FR, DK, IE and LV. At the EU level it reached 40.2% in 2003, albeit with a large gender gap. Rates already exceed the 50% target in SE, DK, UK, EE, PT and CY, and are close in IE and FI. Rates are particularly low in SK, SI, PL, HU, LU, BE, AT, all below 31%.
The Barcelona exit age targets are more difficult to attain. Withdrawal from the labour market continues at an early age in many Member States, and the average exit age has only increased from 59.9 in 2001 to 61 years in 20037 for the EU25. IE, LT, EL, SE, UK have reached an exit age of over 63 years but in SI, SK, PL, BE, AT and MT progress is slow and remains below or close to 59. The challenge is not only to ensure a higher share of and exit age for those aged 55-64 to stay in work; but also to enhance employability of those currently in their 40s and 50s.

6 Figure for 2003 provisional.
7 Figures for 2003 provisional.


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