Live longer, work longer
In the article, Prof Johanna Wallenius highlights several key factors: people are living longer, fewer children are being born, and many people start working later in life or work fewer hours due to longer education, sick leave, and part-time work.
As the pension system is based on lifetime income and financed by those currently working, these trends mean fewer workers are supporting more retirees. Wallenius notes that while the system itself is robust, it was implemented under different demographic conditions. If current trends continue, pensions risk becoming lower in the future.
According to Wallenius, maintaining pension levels will likely require people to work longer and more consistently over the course of their lives, supported by incentives that encourage longer participation in the labor market.
Prof Wallenius’ interests are in the fields of macroeconomics, labor economics, and household economics. She has worked extensively on retirement behavior and reform. For example, together with Tobias Laun, she developed a life cycle labor supply model to quantify the predicted labor supply implications of the Swedish reform which was published in , Journal of Public Economics 127 (2015), 127-136.
