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May 19, 2009
One of the changes in the 2009 budget was raising the retirement age from 65 to 67, with the change to 67 raised progressively from 2017 to 2023. My immediate response is that this good policy measure is undercut by the constant pressure from the markets, governments and companies to get employment numbers down in the name of efficiency. The older workers --- those with bigger accumulations of entitlements and higher salaries ---- are the ones whose retirement will produce a "leaner", and more desirable company or department. So older workers will leave the job early--take early retirement.
Greg Melleuish in The Australian response to this proposal is that it is unfair. He says:
Any government of whatever political persuasion has to deal with the twin issues of the changing age structure of the population and the need to ensure there is intergenerational justice. Governments in Australia have opted for the simple and, it could be argued, unfair solution to this problem by raising the retirement age as well as the age at which one ceases full-time education.
Melleuish says that such a course of action has real problems in that it keeps older people in the workforce at a time when they might not wish to be there. It keeps young people caged up in classrooms when they would prefer to be out in the wider world.
The smarter solution would be to provide young people with the opportunity to escape from the classroom and to gain employment. The truth is that the earlier they start working, the earlier they can retire. This can be done in two ways:
The first thing that could be done would be to slice a year off secondary education...The second thing that could be done would be to make the universities more efficient by insisting on a trimester system that allows for courses to run during summer. This would enable students to complete their degrees in a shorter time and to enter the workforce earlier.
I'm uneasy about slicing a year off secondary education. That effectively means a turn to the pathway of unskilled labour, rather than the pathway of increasing skills to participate in an information/knowledge economy. An indication of why this is such a bad idea.
The path of low skills that leads to a trade qualification is part of the conservative stance of defending the socially conservative battler of suburban and regional Australia against the inner-city professional middle class. Yet in a global world Australia needs knowledge and technical expertise to keep pace, economically and technologically.
Update
Lane Wallace in his Defense of the Liberal Arts at The Atlantic says that:
In an increasingly global economy and world, more than just technical skill is required. Far more challenging is the ability to work with a multitude of viewpoints and cultures. And the liberal arts are particularly good at teaching how different arguments on the same point can be equally valid, depending on what presumptions or values you bring to the subject.
Moreover, if, Australia needs knowledge and technical expertise to keep pace, economically and technologically, it also needs innovators and entrepreneurs creating break-through concepts and businesses. who have the confidence to buck convention. An apprenticeship in a trade is not going to give you that.
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The earlier they retire, the more strain they put on the budget. It would defeat the purpose.
A tertiary summer semester sounds great, except that's when a lot of working students save to cover the rest of the year. It's also when academics do most of their conferencing and travel for various reasons.
John Ralston Saul suggested that we should retire on leaving school, so we can have babies, get extra education and acquire some wisdom before we enter the workforce.