Switzerland: prepare for population ageing to maintain high living standards

swiss 19

(Eberhard Grossgasteiger, Unsplash)

This article is brought to you in association with OECD.


Switzerland enjoys some of the highest per-capita GDP and living standards of OECD countries. Taking action now to prepare for a fast-ageing population will be key for the prosperity and well-being of future generations, according to a new OECD report.

The latest OECD Economic Survey of Switzerland says retiring baby boomers and rising life expectancy will lift the share of the population aged 65 or over to almost 30% by the 2050s, a faster rate of ageing than most OECD countries. The share of people over 80 will double by 2045 to 10%. Updating the pension system and lengthening working lives is crucial to ensure adequate old-age incomes for all and avoid ageing becoming a burden on firms and workers.

The Survey, presented in Bern by the OECD’s Director of Country Studies Alvaro Pereira alongside Swiss State Secretary Marie-Gabrielle Ineichen-Fleisch and Eric Scheidegger, head of the Economic Policy Directorate of the State Secretariat for Economic Affairs (SECO), projects 2019 growth slowing to 0.8% due to increased trade tensions, a deceleration in Europe and the fact 2018 was boosted by income from international sporting events, as Switzerland hosts related sports associations. Underlying growth will remain moderate in 2020 but GDP will again be lifted by sporting events. Given Switzerland’s open economy, risks to the outlook include escalating global trade tensions and economic uncertainty.

Switzerland benefits from high employment and productivity, and has avoided the rising inequality seen in most advanced economies. Yet the employment rate drops for older workers, and pension replacement rates are likely to fall over time, which risks raising income inequality. The burden of rising ageing-related spending will fall largely on cantons and municipalities.

The Survey recommends moving ahead with plans to fix the retirement age at 65 for both sexes, then gradually raising it to 67 and linking it thereafter to life expectancy. Making wage-setting more flexible, flattening the age-related progressivity in pension contribution rates and doing more to combat age discrimination could also facilitate longer working lives. To further ease pension pressures, the rate at which accumulated assets are converted to a pension should be lowered, as the current level redistributes too much from younger workers to retirees.

Ensuring access to quality health and long-term care will be another challenge as the population ages. Average spending per person is the second highest in the OECD and further reducing costs will be key to limit the burden on the public purse and households. Access to long-term care should be improved.

The Survey also looks at how Swiss firms and workers are adapting to an increasingly digital world, and finds that adoption of new digital technologies has not kept pace with leading countries. Switzerland has excellent digital infrastructure but usage of key technologies is low, and just 43% of Swiss adults possess advanced digital skills.

Addressing barriers such as digital skill shortages and a lack of competition can raise productivity and help secure Switzerland’s continued economic prosperity. Facilitating high-skilled immigration from non-European countries would contribute to meeting the needs of a changing labour market alongside efforts to improve skills in the domestic workforce.

the sting Milestones

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Top UN rights official urges transparent probe into Khashoggi disappearance

Neither side stands to benefit in US-China trade spat, UN says

Questions and Answers on issues about the digital copyright directive

EP President calls for emergency assistance to migrants stranded on Open Arms boat

Women’s rights face global pushback from conservativism, fundamentalism – UN experts warn

Team Europe: €34 billion disbursed so far to tackle COVID-19 in partner countries

Here’s why China’s trade deal with Mauritius matters

Data marketplaces can transform economies. Here’s how

Eurozone: Even good statistics mean deeper recession

Primary Care: a way to provide Palliative Care in Universal Health Coverage

To solve the climate crisis, we need an investment revolution

Creating shared value: an opportunity and challenge for entrepreneurship

Bulgaria: MEPs call for EU values to be fully and unconditionally respected

JADE President opens JADE Spring Meeting 2014

Being blinded by labels stops social change. Art helps us see a better future

As threats to IoT devices evolve, can security keep up?

Innovation and entrepreneurship can cut waste and deliver the circular economy

EU Budget 2020 conciliation talks suspended

Global immunization is having its annual check-up. What can we learn?

UN cooperation with League of Arab States ‘pivotal’, UN chief tells Security Council

EU Budget 2019 to focus on young people

Three experts on why eradicating plastic pollution will help achieve gender equality

Berlin wants to break South’s politico-economic standing

This is where teachers are most (and least) respected

Understanding the gender gap in the Global South

European Parliament approves new copyright rules for the internet

Chile ups foreign bribery enforcement but flawed case resolutions are insufficient to ensure transparency and accountability

India’s economy is an ‘elephant that is starting to run’, according to the IMF

What will Germany look like after the next election?

Half the world’s population is still offline. Here’s why that matters

As G7 calls time on coal, have you checked your supply chain?

Campaign kicks off with High-level Event on #FairInternships

Could 2021 be a turning point for forests and climate change?

New UN Syria envoy pledges to work ‘impartially and diligently’ towards peace

The sustainable fashion revolution is well underway. These 5 trends prove it

Arrest of three Libyans wanted for grave crimes ‘would send strong and necessary message’ to victims, urges top Prosecutor

Rule of Law mechanism applies without further delay as of 1 January, MEPs stress

Indonesia has a plan to deal with its plastic waste problem

Rise in violent conflict shows prevention ‘more necessary than ever’: UN chief

Yemen: ‘A great first step’ UN declares as aid team accesses grain silo which can feed millions

Using CO2 as an industrial feedstock could change the world. Here’s how

Protecting European consumers: toys and cars on top of the list of dangerous products

MEPs call for the protection of fundamental values in the EU and worldwide

The West and Russia accomplished the dismembering and the economic destruction of Ukraine

WHO chief underscores need to address climate change following visit to Bahamas

After the George Floyd protests, what next for racial justice in the US?

80,000 youngsters at risk in DRC after forcible expulsion from Angola: UNICEF

Don’t take African generosity towards refugees for granted, says UN refugee chief

Humanitarian action: New outlook for EU’s global aid delivery challenged by COVID-19

Food choices today, impact health of both ‘people and planet’ tomorrow

From DIY editing to matchmaking by DNA: how human genomics is changing society

How global tech can drive local healthcare innovation in China

Here’s why the tech sector could be the next target for Chinese investment in Africa

Is South Korea set to lose from its FTA with the EU?

Artificial Intelligence raises ethical, policy challenges – UN expert

The future of manufacturing is smart, secure and stable

European Semester Autumn Package: Bolstering inclusive and sustainable growth

Can the world take the risk of a new financial armageddon so that IMF doesn’t lose face towards Tsipras?

GSMA Mobile 360 – Africa: Rise of the Digital Citizen, Kigali 16 – 18 July 2019, in association with The European Sting

Universal Health Coverage will ‘drive progress’ on 2030 Development Agenda

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: