To cushion the consequences of inflation, economist Gunther Schnabel is calling for the retirement age to be raised. But according to critics, his proposal is not just based on a false assumption. They also recognize "a populist element" in it.
Life in Germany is getting more and more expensive. In the meantime, not only are energy costs rising sharply, but also the prices of other products. According to data from the Federal Statistical Office, food prices rose at an above-average rate in April. According to experts, consumers will have to be prepared for inflation rates of more than seven percent in the coming months.
In the fight against high inflation, economist Gunther Schnabl is therefore in favor of further raising the retirement age. The economic researcher told the "Bild" newspaper: "The retirement age must rise. Germany already has a huge problem with skilled workers, hundreds of thousands of jobs are unfilled." As a result, among other things, wages would have to rise sharply in the next few years, making goods and other services much more expensive, said Schnabl.
According to the head of the macroeconomics department at the German Institute for Economic Research, Alexander Kriwoluzky, the background to Schnabl's demand is a thesis that assumes that an aging society can have an inflationary effect for two reasons: First, the supply of labor decreases, which increases wages. On the other hand, pensioners fueled demand because they were liquidating savings.
However, Kriwolutzky thinks it wrong for several reasons to draw the conclusion that a longer working life would effectively combat the current price increases. "In order to get inflation under control, we need measures that have a quick effect now. These include monetary policy measures. In contrast, increasing the working life is more of a long-term measure," says Kriwoluzky ntv.de. You will be necessary to stabilize the pension system. Politicians should finally discuss this transparently. "But linking the extension of working life in the current situation of high inflation rates with fears of inflation has a populist impact." It is also problematic because it suggests that the central bank cannot fight inflation on its own, which is not true.
When asked by ntv.de, the director of the Institute for Macroeconomics and Business Cycle Research in Düsseldorf, Sebastian Dullien, does not believe that raising the retirement age is an effective measure to stop high inflation. "Inflation is currently being driven by high energy prices and high food prices, not excessive wage pressures. Extending the retirement age will not help against these high energy and food prices," says Dullien. There are theories that have predicted that inflation will arise in the long term due to a shrinking labor force because this shortage could increase wages. So far, however, empirical evidence has not indicated that the current inflation has anything to do with age-related shortages in the labor force or excessive wage increases.
"A labor shortage is currently not a relevant inflation factor, neither in Germany nor in the most important countries from which we import," says Dullien. Rather, the lack of workers in certain areas is due to the fact that working conditions in many areas are bad or have deteriorated during the Corona period - such as in the health system. "If these grievances are eliminated, the bottlenecks in these areas should improve."
Last summer, proposals by the Scientific Advisory Board at the Federal Ministry of Economics and Technology regarding a reform towards retirement at 68 caused a great deal of excitement. According to the current legal situation, the age limit for the pension will be gradually raised from 65 to 67 years without deductions by 2029.
6
