Thought of the Day

France’s Retirement Risk


 
18 March 2025
 
The working-age population of France has been in decline over recent decades due to its falling fertility rate which is now sub-replacement. And with the elderly living increasingly longer, there has been a decrease in the number of taxpayers available to support the ever-expanding cohort of dependent retirees. This is exacerbated by the fact France has the third highest life expectancy in the EU.

In 1950, almost 6 workers supported each French retiree, alongside their ordinary Government taxes. A century later, it is estimated 2 workers will strain to support each retiree – close to the average across the EU. This is an increasingly unsustainable – and unprecedented – generational tax burden on the French working population.

Number of Workers to each Dependent (65+) in France and across the EU
The working-age population represents those aged 15 to 64. Period: 1950-2050.
France’s Retirement Risk
France’s Retirement Risk


Note: The EU average is calculated by summing the number of workers to dependents in each EU country and then dividing by the total number of countries (27).


As can be seen in the chart above, France has been at the forefront of this trend. Government attempts to reverse this decline, such as raising the pension age, have proven unpopular. The option of allowing mass immigration to bolster the working population also appears politically unviable.

The cost burden on the French taxpayer is therefore growing unchecked. This is because retirees cost Governments the most out of any age demographic due to expensive pensions and medical and care provisions. Estimates suggest that retirees cost the Government three times that of working-age people in terms of annual spending. The declining number of taxpayers available to support the rising number of expensive-to-maintain, non-working retirees will mean the tax burden on the working population of France could soon become overwhelming.

More for subscribers:  
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