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Business sceptical about raising retirement age

Recent surveys show businesses would be reluctant to hire anyone over 65 Keystone

Plans to raise the retirement age from 65 to 67 are being challenged by businesses across Switzerland.

This content was published on July 5, 2003 - 14:06

A new study shows that most firms view Interior Minister Pascal Couchepin’s blueprint as “unrealistic”.

Earlier this year Couchepin unveiled controversial plans to raise the retirement age in two stages – up to 66 in 2015 and 67 in 2025 - in order to “save” the state pension scheme.

According to government estimates, spending on the state pension scheme will increase significantly until 2040 as a result of demographic changes.

However, a survey, published by the weekly “Handelszeitung” newspaper, found that 85 per cent of Swiss companies would be reluctant to hire an employee older than 65.

Colette Nova of the Swiss Federation of Trade Unions told swissinfo that she was not surprised by the business community’s reaction.

“Swiss companies are not willing to employ elderly people,” she said.

Room for older workers

But Peter Hasler, director of the Swiss employers’ association, has criticised the study for brushing over the fact that 58 per cent of companies said they would be willing to retain employees over 65.

“The issue is not how many firms would hire 65 year olds, the issue is how many companies would keep their employees over 65, and a majority of firms answered this question with ‘yes’,” Hasler told swissinfo.

The Swiss employers' association argues that demographic changes will actually force employers to hire or keep older people in order to remain competitive.

“As of 2006, the working population will shrink and developments over the next two decades will force companies to employ or keep older people,” said Hasler.

Impossible plan

According to Martin Mezger, the director of Pro Senectute, the Swiss organisation for the elderly, it will be impossible to put Couchepin’s blueprint into practice.

“A step-by-step withdrawal from working life would be a much better solution to save Switzerland’s state pension scheme,” Mezger told swissinfo.

The survey, which questioned 300 firms in German- and French-speaking parts of the country, found that even companies where the over-60s make up a tenth of the workforce are opposed to the proposal.

The reason for the strong opposition is that many businesses want to maintain a young workforce and are currently pursuing a policy of early retirement as part of their cost-cutting strategy.

However, Hasler thinks that the trend for maintaining a young workforce is slowly changing.

“I am convinced that companies will be more willing to keep employees over the age of 65. Recent trends have shown that bosses of big companies have realised that youth is not everything,” Hasler said.

“We have made a mistake by linking the seniority of employees to their salaries, and that has to change in the future.”

Early retirement

The survey was published shortly after Swiss construction workers aged between 63 and 64 began taking advantage of an early retirement programme on July 1.

After a long-running dispute, unions and employers reached an agreement last year that retirement at 60, rather than 65, would gradually be phased in from the middle of next year.

As of 2006, all construction workers should be able to retire at the age of 60.

Couchepin is expected to submit a government proposal on raising the retirement age, which would be discussed by cabinet later this year.

swissinfo, Billi Bierling and Elvira Wiegers

Key facts

A survey shows that 85 per cent of companies are opposed to a plan to raise the retirement age.
More than 58 per cent of the companies would keep employees beyond 65.
Twenty-five per cent of all employees are currently taking early retirement.
As of July 1, 2003 construction workers can take early retirement.

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