By Patrick Anderson

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Extra info for Ageing and Employment Policies: Sweden (Ageing and Employment Policies)

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Public old-age pensions For the majority of people in Sweden, their income after retirement is still mainly derived from a public pension. Occupational pensions, on average, only account for around 20% of total pension entitlements. However, these pensions are of substantial importance to persons with incomes above the social security ceiling. Individual pension schemes account for an even smaller amount, although their coverage has increased quite dramatically in recent years. A. Trends in public expenditures on old-age pensions Currently, expenditures on public pensions account for about 9% of GDP and more than 50% of all social security expenditures.

Because pension rights will only be earned 58 up to the ceiling, replacement rates will be lower. Pension entitlements will, however, increase for every year the pensions are not drawn and new pension rights can be earned without any limitation on age. For this group of income earners, occupational pensions play a crucial role. However, currently most occupational pensions are activated at the age of 65 or earlier. 4. Net replacement rates in the new Swedish pension system for people with different incomesa Percentages 50% APW 100% APW 150% APW 110 100 90 80 70 60 50 40 30 20 10 0 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 Age a) Including occupational pensions.

In other words, it is the total amount of working hours that contributes to economic growth not the number of employees. Reducing absence from work, especially illness, increases economic growth at the same time as both public expenditures and employer expenditures are lowered. 6. 9 Source: Swedish Labour Force Survey. 3. Reasons for absence as a share of total absence, 2000 Percentages of all absences for each gender and age group Illness Vacation Parental Leave Irregular working hours Public holiday Laid off or similar leave of absence % of absence 100 90 80 70 60 50 40 30 20 10 0 25-49 Men 50-59 Men 60-64 Men 25-49 Women Source: Swedish Labour Force Survey.

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