When US president Joe Biden runs for president for the second time, he will be 82. Warren Buffet is still chairman of Berkshire Hathaway at 92. Ratan Tata passed on the baton to Cyrus Mistry only at 75 years of age. While these people may have the luxury of deciding how long they want to keep working, most of the world’s population abides by a certain cut-off age to retire.
The concept of retirement age came about in 1881, when German chancellor Otto Von Bismarck set it at 70 years in an appeasement response to socialist ideologies in the country. Germany finally adopted 65 as the age to retire in 1916, a model that was widely replicated the world over.
By the middle of the 19th century, almost all countries had adopted a cut-off age to retire. That was then. Life expectancies were shorter than retirement ages, healthcare and medicine were not as advanced as present, and people didn’t age well.
Today, as the world population tilts toward advanced years—the global median age in 2020 being 31.0, a significant rise from 23.6 years in 1950—with much higher lifespans and fitter and healthier people, the concept of retirement age is under debate in many nations. Some like France recently legalised advanced ages to retire. Others like Germany, UK, Italy and China are also expected to advance their retirement ages soon. In India, too, which has one of the lowest retirement ages at 60, many a strong case have been made to postpone retirement age.
When it comes to economics, it is the number of years that people will live post-retirement as a result of higher life expectancies that is now a figure of concern. While this number globally was less than 20 just 50 years ago, presently people are expected to live around 23-27 years post-retirement. In India, the life expectancy increased to 70.1 years in 2020 from 61.7 in 1998. By 2047, it is estimated that about 140 million people will be above 60 years of age in India.
The burden of this on the pension pot can only be imagined. And, while governments might have economics behind the reason to delay retirement—getting more people to stay in the workforce and needing to pay lesser pensions and social securities—nature has its own argument as well.
Medical evidence indicates that cognitive abilities are well preserved in the seventies. Even though the brain’s prefrontal cortex (the area that controls attention, memory and executive functioning) starts to decline after 45 years of age, this is adequately compensated for by other areas of the brain. In fact, studies indicate that some aspects of cognition, such as crystallised intelligence (which means accumulated knowledge that can be applied to new situations) and social cognition (behaviour patterns in interpersonal interactions) actually improve with age. Moreover, remaining occupied in a working role checks both physical and mental decline in individuals. The refrain that emerges is: it’s the job and not the age that should matter.
And while this might be contested for jobs requiring rigorous manual labour and optimal physical condition, a cut-off retirement age no longer seems valid in general.
The issue of different retirement ages for men and women also needs to be tackled. Ironically, in most countries, women are forced to retire earlier despite having higher lifespans than men.
However, retirement cannot be an individual’s call in most cases. This calls for some mechanisms that can be put in place by governments and even organisations to assess a candidate’s work potential. These could include multiple, layered evaluation of cognitive and physical fitness required for the job. Of course, this will involve certain investments, but in return workplaces get to juice a skilled professional to the maximum instead of letting people go who still have the chops.
The French said it right while effecting new retirement laws that “retirement age is not set in stone”. Jacinda Ardern hanging up her political boots at 42 or a celebrity Australian online toy seller earning over $130,000 a month deciding to retire at 11 clearly took the cue.
