The retirement age in Spain is undergoing a transformation process, increasing progressively from 65 years to 67 years in 2027. At present, the ordinary retirement age is 66 years and six months or 65 years for those who have contributed for more than 38 years.
However, a recent study A study carried out by the Foundation for Applied Economic Studies (Fedea) warns that postponing retirement age would be linked to a higher risk of early mortality.
The impact of delaying retirement. The new research complete a prior analysis carried out by researchers in 2022, which highlights that delaying leaving the labour market by one year “significantly” increases the risk of dying between the ages of 60 and 69. The study indicates that this increase in risk would be especially noticeable in those professions with greater physical demands and high levels of stress.
Researchers suggest that this risk is considerably lower for those workers who have the option of partial retirement, which allows them to gradually reduce their working hours during the years leading up to their ordinary retirement age.
Basis of the study: Spain in 1967. The research takes as a reference point the retirement reform carried out in 1967, which modified the early retirement age based on the date on which workers began to contribute to the Social Security system. Those workers who had contributed before January 1, 1967 could retire voluntarily when they turned 60, while the rest had to wait until they turned 65, with some exceptions due to the type of profession.
The authors of the report, from the Universities of Barcelona, Pompeu Fabra University and Mannheim University, analysed how the retirement age affected this reform and the impact on the mortality of those who retired. The results indicated that the risk of mortality is higher in physically demanding and mentally stressful jobs, but decreases when there is access to partial retirement.
We are not the same in 2024In their calculations, the researchers also took into account the difference in life expectancy, which stood at 71.25 years in 1967, and the 83.08 years revealed by the latest data of the INE of 2022. Logic leads us to think that a 65-year-old person in 1967 arrived in worse physical condition than his counterpart in 2024, justifying the 12 years of survival between them.
For this reason, the researchers applied an adjustment factor when crossing the data from the Continuous Sample of Working Lives from the Ministry of Social Security, with the associated mortality results by age. The report indicates that “delaying leaving the labour market by one year increases the risk of dying between the ages of 60 and 69 by 4.4 percentage points (38%). The increase in mortality is mainly due to the immediate effect of losing access to early retirement schemes.”
Delaying the retirement age does not pay offThe study concludes that restricting or eliminating early retirement has a significant social cost. The negative impact on life expectancy among those who cannot access early or partial retirement outweighs the economic benefits of extending the working life of workers.
The Fedea report therefore proposes a system of progressive retirement. “Allowing workers to gradually reduce their workload can encourage them to remain in the workforce for longer without negatively affecting their life expectancy,” the experts point out.
Part-time retiree. The law has recently been modified. partial retirement modality to which they refer in the study, which, like the ordinary retirement age, is also undergoing a transformation process. In 2024, those aged 62 and six months with 36 years of contributions or more will be able to benefit from partial retirement, or those aged 64 who have contributed for at least 33 years will be able to benefit from partial retirement. In 2027, the age to access this partial retirement option will be 63 years with 36 years and six months of contributions, or 65 years if you have contributed for at least 33 years.
Partial retirement contemplates two scenarios:
- Partial retirement with a replacement contract, in which the candidate signs a part-time contract which, as its name suggests, the company will use to train a younger unemployed person or a part-time company employee who will replace him in his position. With this modality, the part-time salary complements the reduction in the employee’s pension based on the hours of the contract and the reduction in the retired person’s working hours may vary between 25% and 75% (even 85% in exceptional cases).
- Partial retirement without a replacement contract, which does not include the training of a replacement, so the reduction in working hours will be limited to between 25% and 50% of the normal working day.
Longer life expectancy and incentives to continue working. In the same way that the Fedea study recommends making partial retirement more flexible to improve the quality of life at the end of the working stage, the Administration put on the table in 2023 a reform in which tax incentives are given to those who want to delay their retirement age.
The other side of the coin is that those who want to retire early without having met the contribution requirements have seen their pension reduction factors increased by up to 21% depending on the time they have contributed, discouraging premature retirement.
