Economist Urges Increased Workforce, Higher Retirement Age
In a recent interview, renowned economist Martin Werding emphasized the need for a more robust workforce and a higher retirement age to combat the demographic challenges facing the German economy.
According to Werding, the declining number of working-age individuals will significantly impact the country’s growth prospects in the coming years. He suggested that addressing the hurdles to full-time or part-time employment, particularly in the context of women’s participation in the workforce, could help counter this trend. “More and reliable childcare options would certainly help” he stated.
The economist also called for a review of the retirement age, citing the need to balance growth with the financial sustainability of the pension system. He pointed out that the current retirement age and early retirement incentives, which involve minimal pension deductions and tax-exempt pension entries, require reevaluation.
Regarding the plan to introduce a maximum weekly working hour, Werding defended the proposal, arguing that it is about increasing flexibility in work arrangements, not expanding the standard full-time work volume. “We should discuss this without blinders” he said, suggesting that the change could also benefit employees.
As a professor of economics at the University of Bochum and one of the five economic experts, Werding’s opinions carry significant weight. The Sachverständigenrat, a council of economic experts, will present its spring report for 2025 on Wednesday.