Flying longer
Flexibility in retirement age is the way forward, India or West
Air India pilots will retire at 65, bringing parity between two merged entities – Tatas' Vistara, and GOI's Air India that the Tatas bought. But it's not parity alone, there's also a shortage of commercial pilots. So, it's a timely and rational decision. Globally, the world of work is going through a pivotal moment as longevity, declining fertility and manpower shortage are coming together to impact workforce composition and pension systems. The set of reasons driving the leaving-work conversation may be different, but the answer, in India as well, lies in raising the age, given capacity and ability of healthy older workers, and the necessity of easing pension burden.
Over half the developed nations are raising retirement age – average age within OECD countries will soon be 66. Germany last Sept incentivised later retirement to balance worker shortage and pension burden. Spain too incentivises postponing retirement – putting it off by a year from the legal age, increases pension by 4%. Incentives increase with each year of postponement, with exemptions for those with more than 38 years and 6 months of worklife. Japan and Singapore re-employ post-retirement, hours and pay negotiated between employee and employer.
In India, it has long been argued, wrongly, that pushing back retirement chokes career pathways for large populations of younger cohorts. The truth is, it is a stymied job market and lack of opportunity that's the chokehold on youth aspirations. State govt after state govt has increased the retirement age of teachers and medical practitioners, because of a shortage of resources. India Inc is doing it regularly. Veterans bring expertise, experience, ability and stability. A large section of urban India lives well past 80, but are benched between 58 and 60 in fit working condition. Economic Survey 2018-2019 noted a higher retirement age was crucial for the viability of pension system, 'perhaps inevitable'. The way forward is for retirement age to have as much flexibility as the young would have with workhours, working conditions and workspaces.
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This piece appeared as an editorial opinion in the print edition of The Times of India.
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