Can Retirement age 60 to 58 Solve Unemployment Problem?

Can Retirement age 60 to 58 Solve Unemployment Problem?

 “The Financial Express”, one of the leading newspapers recently published a news article on the Central Government’s plan to reduce the retirement age of employees from 60 to 58. This news shocked the central government employees.

“Reducing the retirement age of central government employees from 60 to 58 will help to solve the unemployment problem in India?”

Reasons for decreasing the retirement age from 60 to 58:

The following reasons are attributed for decreasing the present age of retirement:

            1) To create more employment opportunities for the youth

2) To increase the contribution of younger employees in the government sectors and

3) To compensate the loss accrued due to payment of allowances

Unemployment issue:

            None can have any disagreement about the fact that employment opportunities should be provided for the unemployed. There are so many ways for solving the unemployment problem. They are:

1) Introducing new employment policies

2) Filling all the positions lying vacant and

3) Promoting self-employment by introducing new schemes and providing suitable facilities and many more ways can help to solve the problem of unemployment.

 

Increasing the retirement age from 60 to 62 for scientists:

            In the Rajya Sabha, for a question raised on increasing the retirement age for scientists from 60 to 62 in written format, the response given was:  “it is under consideration”.

The important reasons for increasing the retirement age for scientists are:

1) Their experience and expertise should benefit the younger generation and

2) The average life span has increased.

“Isn’t there a need to increase the retirement age of employees working in other fields?”

Allowance issue:

Extra allowance that has to be paid is cited as a reason for bringing down the retirement age of employees from 60 to 58.  However, in reality, the pay commission is set up only once in 10 years and benefits the central government employees.

“In the long interval of 10 years, only these allowances help the employees to cope with inflation”.

In the past, the average service period of a central government employee was 30 to 40 years. Presently, as the age limit for appointment has been relaxed, the average service period has come down to 20 to 30 years. Due to this, an employee can only have 2 or 3 pay commissions in his service period.

In this situation, citing allowance as a reason for decreasing retirement age and altering the present allowance rates will adversely affect the economic condition of central government employees.

Average retirement age in the world:

The average retirement age of many nations is between 63 and 65. Comparatively speaking, even the age of 60 is obviously a very early age for retirement. In this context, we do not know whether the employees will accept 58 as the age of retirement.

Will early retirement solve the unemployment problem?

Employment for all is a very important. It is the duty of a nation to provide employment to all her youth and lead them in a better way.  The hope and aspiration of every youth in this country is to get a good job. They do not expect the retirement age to be brought down from 60 to 58.

Even when all the 50 lakh central government employees retire, will it help to resolve the unemployment problem of this nation?