EU calls on Europeans to work longer

Raising the retirement age is one way European countries are combatting the effects of the global downturn.

BRUSSELS // A European Union report called Wednesday on Europeans to work longer to keep receiving state pensions from cash-strapped governments. The European Commission said the average retirement age in the 27-nation bloc would have to increase from the current age of 60 to 70 by 2060 if workers are to continue supporting retirees at current rates.

Europe is aging as people live longer and birth rates fall gradually. There are currently four people of working age for each person over 65. Two workers will support one retiree by 2060. Governments with mounting debt are hiking retirement ages to help reduce the expected pension shortfall. Germans will retire at 67 starting in 2029. Spain is considering a similar increase and Britain is planning to hike the age to 68. There has huge public opposition across Europe to making people work longer. The French President Sarkozy is having a hard time winning support for raising France's retirement age from 60 to 62. Greece has seen violent protests against pension reforms that include making people work beyond an average retirement age of 61, one of the lowest in Europe. The EU employment commissioner Laszlo Andor said it was urgent for Europe to act now because its working age population will start to shrink from 2012. "The current situation is simply not sustainable," he said. "The balance between time spent in work and in retirement needs to be looked at carefully." The EU is not seeking a Europe-wide retirement age and has limited powers over employment rules - which are mostly set by national governments. But it wants to spark a debate to prevent a ticking demographic time bomb. It says a recent survey of people across Europe shows that nearly three-quarters of Europeans think they will receive pensions below current payments or will have to postpone retirement and save more for their old age to enjoy a decent standard of living. The European Trade Union Confederation says there is "no evidence" that employers want to keep older workers. "The prevailing philosophy among too many employers is that older workers are too set in their ways to match changing work environments and should be encouraged to leave early, well below statutory retirement ages," said ETUC's John Monks. * Associated Press