Thu, Feb 09, 2023 page9

• ‘Commute, work, die’ should be retired

  Labor protest-hit France seeks to create a better workplace environment for older employees

  • By Lionel Laurent / Bloomberg Opinion
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  Whatever the slogans wielded by striking workers angry at French President Emmanuel Macron’s pension reform might say— such as “commute, work, die” — French workers are anything but lazy. The country’s unemployment rate is at its lowest in years, and France has a greater share of 25-to-54-year-olds in work than the EU average, or indeed the US. The pace of job creation is above pre-COVID-19 pandemic levels.

  However, France punches below its weight in its share of workers aged 55 or older. Macron wants to raise that number, but not just by pushing the retirement age to 64 from 62; he wants to prod companies to hire more people in their 50s and 60s, setting targets for diversity by age.

  Similar steps have been taken elsewhere, such as when British firms, including Aviva and Walgreens Boots Alliance in 2017 pledged to hire more people older than 50.

  

  Illustration: Mountain People

  The French version looks distinctly less touchy-feely, with the threat of fines if companies do not play ball.

  If Macron is tying the idea of tougher age quotas to pension reform, it is also as a sop to critics and unions, which say lifting the pension age would worsen unemployment as older workers get laid off before retirement.

  Expanding the labor pool is an issue of great economic significance — potentially even more so than the estimated 17.7 billion euros (US$19 billion) the Macron administration hopes the reform would unlock.

  If France lifted its employment rate of workers aged 55 or older by about 10 percentage points to 66 percent (the G7 average) by 2032, that might mean an extra 825,000 workers and almost 50 billion euros in extra GDP by one estimate.

  This is not just a French thing — PricewaterhouseCoopers has said the Organisation for Economic Co-operation and Development as a whole could add US$3.5 trillion to GDP if it lifted the employment share of people aged 55 or older to 78 percent — but France is a clear retirement outlier.

  In principle, publishing more data at the corporate level would be a good way to shine a light on divergent national and company practices, beyond the basic hike to the retirement age if the reform goes through.

  There does seem to be a gap worth tackling. Luxury goods conglomerate Louis Vuitton Moet Hennessy has a higher share of staff aged 50 to 59 in France than elsewhere, but has more employees aged 60 or older in the US than in its home market.

  Transport company Transdev Group has 20 to 30 percent of drivers aged 60 or older in Germany, Sweden, the Netherlands and the US; in France, it is 12 percent, France Inter radio data showed.

  However, just as raising the pension age feels like a blunt tool for today’s workers watching today’s retirees enjoy wealthier and healthier twilight years, quotas would not fix the deeper issues below the surface.

  If French workers are not thrilled about working longer, it might be because many feel like they have already paid their dues. French executives are the world’s worst workaholics, a Bupa survey found, which might be one reason that few retirees are misty-eyed about going back.

  Perceptions of cost and skills gaps with younger workers also encourage ageism.

  A 2015 Eurobarometer survey found 75 percent of French managers believed a job candidate older than 55 would be at a disadvantage.

  Any silver quota would likely be shrugged off by key sectors such as technology, in which 40 is the new “old” and young coders are seen as competitive advantages.

  What should really happen instead is a re-evaluation of the “three-stage life” — education, work and retirement — that is proving resistant to change, even as the prospect of living to 100 becomes less outlandish.

  Instead of tacking on concepts such as mentoring to one’s late-career life, retraining should happen more regularly (maybe every decade).

  Instead of associating older workers with high health costs, it is worth following the example of BMW’s “2017 production line,” in which a small investment in physical well-being — wooden floors, magnifying lenses, adjustable chairs — boosted older workers’ productivity.

  The carrot of a more flexible transition between work and retirement, such as by combining part-time work with partial pension payments, or by sharing one older hire between small businesses, might be better than the stick of quotas.

  This might seem like a sideshow next to the core issue of the retirement age that has put hundreds of thousands of protesters out on French streets, and that has Macron’s opponents in parliament pressuring his administration to back down.

  Ideally, his reform would be made fairer and more acceptable by sharing the financial burden between companies and retirees, not just workers, but the reality of demographic and economic decline means that the long-term question of silver workers — and the effectiveness of quotas — is the far bigger one.

  “Commute, work, die” should be retired.

  Lionel Laurent is a Bloomberg Opinion columnist covering digital currencies, the EU and France.

  This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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