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2025: base-year data. 2030-2070: COR's June 2026 reference scenario. The projection incorporates existing legislation and later retirement.
| Year | % of GDP | Data type |
|---|---|---|
| 2025 | 14.1 | Base-year data |
| 2030 | 14.1 | Projection |
| 2045 | 14.2 | Projection |
| 2070 | 15.3 | Projection |
OECD 2025, Table 8.4; these countries' projections come from the 2024 Ageing Report and incorporate legislation at that time. Benefit coverage differs by country; healthcare and long-term care are excluded.
| Country | 2023-24 | 2050 |
|---|---|---|
| Spain | 13.6% | 17.3% |
| Belgium | 12.8% | 14.8% |
| Germany | 10.2% | 11.0% |
| Denmark | 8.7% | 7.8% |
Market commentary
My perspective on markets, the economy and events that matter to investors.
Pensions under pressure: why the West needs longer working lives
Sources reviewed on 4 November 2026. France: COR, June 2026. Country comparison: OECD 2025 / 2024 Ageing Report. Historical data and projections are labelled separately. Economic commentary; projections are conditional.
In many Western countries, gradually raising the retirement age can help protect pension benefits and limit the burden on younger generations. The reason is simple: the number of older people is growing relative to the working-age population.
1. Why work longer?
According to the OECD, there are on average 33 people aged 65 or over for every 100 people aged 20-64 in 2025. By 2050, that figure is projected to reach 52. This compares age groups, not pensioners and workers. In systems that finance current pensions through contributions and taxes, this shift makes the arithmetic increasingly difficult. OECD
Later retirement usually extends the period of contributions and shortens the period of benefit payments. It can also increase output and tax revenues. Savings are not automatic, however: they depend on employment among older people and the rules for calculating pensions. Alternatives include higher taxes, more borrowing or benefits growing more slowly than wages.
2. France: the pension bill
France shows how politically difficult such a change can be. The 2023 reform provided for raising the minimum retirement age from 62 to 64. Its implementation has been partly suspended; under current legislation, the age of 64 applies to people born from 1969 onwards. Exceptions allowing earlier retirement remain. Service Public
France’s pension system cost about EUR 422 billion in 2025: 14.1% of GDP and almost a quarter of all public spending. GDP measures the value of the economy’s output. COR’s latest reference scenario puts expenditure at 14.2% of GDP in 2045 and 15.3% in 2070, an increase of 1.2 percentage points from 2025. COR 2026
To illustrate the scale, at the size of the French economy in 2025, an additional 1.2% of GDP would equal about EUR 36 billion a year. This is our calculation, not a forecast of nominal expenditure in 2070. Crucially, the COR scenario already incorporates later retirement and average pensions growing more slowly than wages. COR 2026
3. How could spending change elsewhere?
The OECD comparison projects particularly large spending increases by 2050 in Spain and Belgium, a smaller rise in Germany and a decline in Denmark. Ageing therefore does not imply the same outcome everywhere: pension-system design and adopted reforms matter. The chart covers pensions, excluding healthcare and long-term care. OECD, Table 8.4
4. Reform needs fair rules
Retirement ages should rise gradually, with ample notice. This needs to be accompanied by opportunities to find and keep work after 60, flexible hours, and protection for people in poor health or physically demanding jobs. The OECD stresses healthy working conditions and continued training for older workers. OECD Employment Outlook 2025 Higher employment, greater productivity and well-designed migration policies can also ease the pressure. Changing a number in legislation alone is not enough.
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