5.6.1. Estimating impact of employment

The microsimulation produces results reflecting the difference in the number of employed people by comparing outcomes where an intervention is in place and business-as-usual.

To calculate the annual, country-specific difference in salary under the scenarios, the following data are used for salary calculations:

  • Latest available salary data in EUR 2015, based on ILO [ILO, 2018 [32]], reflecting the total average salaries for full time employment men and women in OECD countries, based on baseline employment rates from Eurostat data ([Eurostat [16]]).

  • The projected labour productivity rates until 2060, for all OECD countries, obtained from ECO-OECD [OECD, 2018 [45]].

For the annual age in year \(2015+x\), wage is calculated as follows:

\[{Wage}_{2015+x} = {wage}_{2015} \times (1 + \frac{{PDTYPT}_{2016}}{100}) \times .... \times(1 + \frac{{PDTYPT}_{2015+x}}{100})\]

Wages were calculated in gender- and country-specific fashion.

5.6.2. Estimating impact of early retirement

The economic impact of early retirement is obtained by calculating the lost salary, as well as the cost due to early pension payments. Notably, data at the European level on the costs of early public pension are only available for 2013, and as an EU-average [Eurostat, 2016 [17]].

For each country in a given year, per sex, the lost salary is calculated by multiplying the likelihood of early retirement to the workers in age group 50 – 65, and the difference in full time employees due to early retirement. The difference in full-time workers is multiplied by country and sex specific wage data.