Retirement age to lift again: Is 67 too old to be working?

With the cost of living and interest rates preoccupying most everyday Australians, many may have missed the fact that the Australian retirement age is going up to 67 from July 1 for those born after January 1, 1957.

Though the change has been coming since as far back as 2009, recent weeks have seen workers and unions alike express their frustration at the decision to stick with the change, particularly in blue collar industries and health care, where roles are often more physically and mentally demanding than white collar positions.

Recent surveys have indicated overwhelming opposition to the change - between 80 and 90% - with claims that the latest increase will leave a generation of workers forced to choose between staying in industries their bodies are no longer equipped to handle or facing the prospect of unemployment in old age.

Though the latest changes are still days away, there are already concerns about the retirement age being further lifted to 70 in coming years. While the current change was originally floated by the Rudd government in 2009, a proposal to lift the age further to 70 was actually included in the 2014-15 Federal Budget, though this was quickly abandoned after significant objection from unions and seniors group as a Federal election loomed.

The issue refuses to go away though, with industry experts supporting continued increases as recently as March this year. According to Macquarie University, low birth rates and increased life expectancy should result in at least three more increases, bringing the retirement age to 70 by 2050, even as younger generations find themselves at the mercy of unrepentant inflation and economic uncertainty.

Australia won't be the only nation with a retirement age that high, although in many other instances there are exceptions for workers in particular industries, as well as other concessions determined by how long someone has been working, with 40 years of economic contributions considered a retirement threshold in a number of nations. It's also worth noting that while most nations have plans to gradually increase their retirement age, many are still to reach 65, let alone 67.

Though there is logic to the claims that blue collar, physically demanding industries take a debilitating toll on the body that makes it difficult to remain in the workforce as the retirement age increases, it's worth noting the negative impacts of an increasingly sedentary life on white collar employees who are regularly bound to desks for long hours and also have lifestyle imbalances and challenges to the maintenance of physical health.

The impacts of physical labour are more obvious in appearance, but workers who've been required to sit at a desk for 8-10 hours a day for 40 years will find themselves with a significantly higher risk of chronic health issues including heart disease, diabetes and even cancer - risks that also go up with every month and year that's gradually added to the retirement age.

Then there's the issue of superannuation. There have been gradual - and recent - increases in the super guarantee, which might have a long-term view but is in reality leaving most workers with less take-home pay despite still being paid the same amount in the midst of a cost of living crisis. Meanwhile in the midst of the pandemic, workers were being told to consider withdrawing money from their super to do things like enter the housing market. Meanwhile indexation has also hit HECS/HELP debt with a whopping 7% increase that could add years to the repayments of many young post-graduates.

It's no wonder more Australians are starting to take matters into their own hands, increasing super contributions and setting aside money to self-fund their own retirement now. But with inflation creeping into every corner of our lives and expenses and wages falling well short of meeting that, as well as the housing market and little support for middle-income earners, it's impossible to know if that respect-worthy initiative will actually matter by the time it takes our newest workforce members to even think about calling it a day.

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