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When the corona virus began to spread in the spring and winter of 2020, many young people with temporary jobs quickly lost their jobs and it became more difficult for those who wanted to enter the job market. According to Statistics Sweden, unemployment increased from 6.8% in 2019 to 8.3% in 2020.
But those 65 and older broke the pattern during the 2020 pandemic year. Employment among 65-74 year olds continued to rise as in previous years. Older people were also unaffected when unemployment rose due to the 2008 financial crisis.
This development is taken up by the interest organization SPF Seniorerna in a new report “Seniors who work”. The report emphasizes that many people over 65 are still in the job market and that there are more of them. According to the report, 230,000 seniors between the ages of 65 and 74 will work in 2025 if the trend continues, an increase of 22 percent.
The SPF Seniors report emphasizes also that it is not only the elderly who benefit from continuing to work. His work also contributes to the Swedish economy. According to the report, employed older people contributed SEK 136 billion to Sweden’s GDP in 2020.
But what is causing more and more older people to be in the job market to an increasing degree? Eva Eriksson, president of SPF Seniorerna says that one of the reasons is the high demand for healthcare personnel, but there are other factors that also come into play.
– Many of those who worked in the service sector and in industry need to supplement the low pension with other income. There are also many older people who are more alert and in better health than previous generations, although there are also those who have had very strenuous occupations and cannot continue to work, he says.
Statistics Sweden continuously produces statistics describing the evolution of the labor market in the Labor Force Survey, EPA. Statistics support that there are more people aged 65-74 in the job market now than ever before.
– In 2005, about 1 in 10 in the group were employed and by 2020, employment had risen to almost 1 in 5, says Krister Näsén, a researcher at Statistics Sweden.
Although most still sees the 65th anniversary as the retirement age, which is why many choose to continue working. There are many reasons for this. One of the most important is that the LAS age, the age at which one is covered by the Employment Protection Act, has been raised from 65 to 67 years. Starting in 2023, the LAS age will rise to 68 years.
Eva Eriksson, president of SPF Seniorerna, believes that the LAS age should be raised even higher so that older employees can continue working longer than today. Among other things, because the retirement age is rising. Starting in 2026, a target age will be introduced into the pension system and then the retirement ages will be raised according to life expectancy.
– It is extremely important that the pension system is linked to the other rules of the labor market. The LAS age, for example, should be higher than the target age, he says.
Another reason more older people work is that it has become more profitable to have income since the year you turn 66 because the tax is lower. In addition, those who take out a pension one or more years before the year in which they turn 66 are affected by the fact that the income tax on pensions is higher than the corresponding earned income.
