Future of the labor market and pension – A long-term exploration

“Social partners can offer workers periodic career development service. Government can coax companies to promote sustainable careers”

The new pension system that takes effect around 2026 is better attuned to the labor market than was previously the case. Still, lower-educated people, mothers with small jobs, migrants, people who perform repetitive tasks, and workers with physically demanding occupations are at risk. That is the conclusion of Netspar’s exploratory study for the longer run? The lack of investments in lifelong learning poses another risk. Working people often cannot bear the costs themselves or do not look that far into the future. In addition, as for employers, they might not want to invest because their employees frequently change jobs and so it brings little benefit to the employers. This market failure can be addressed by the social partners and the government.

Key Takeaways for the Industry

• The future labor market needs a more flexible, dynamic pension scheme that takes better account of longer and diverse careers.
• It is important to invest further in career development, in skills and in sustainable employability.