Top Countries Where Retirees Are Likely to Rejoin Workforce

The COVID-19 pandemic has dramatically transformed the job market, giving rise to notable employment trends such as the Great Resignation and the Great Rehire. While these phenomena have garnered significant attention in recent years, another emerging trend—the Great Unretirement, or the Great Return to Work—warrants closer examination. This shift highlights a growing number of retirees re-entering the workforce, offering valuable insights into the evolving landscape of employment in a post-pandemic world.

The term “The Great Unretirement” highlights the growing trend of retirees, particularly those over 50, returning to work in developed nations. A key driver of this movement is the escalating cost of living, which makes it challenging for many retirees to maintain their financial stability. Additionally, various factors such as healthcare access, state-sponsored pensions, and the official retirement age also play a significant role in retirees’ decisions to re-enter the workforce.

To shed light on the phenomenon of the Great Unretirement, our research team examined welfare, economic, and demographic data from the 45 wealthiest countries. We ranked each nation based on the likelihood of retirees reentering the workforce. If you’re interested in where your country stands on this list and what factors contribute to the trend of unretirement, explore the study’s findings below.

Key findings

• Poland’s retirees are most likely to return to work.
• Saudi Arabia’s welfare system favors retirement least.
• Israel’s economy favors retirement least.
• Israel’s demographics favor retirement least.
• Denmark’s retirees are least likely to return to work.
• Denmark’s welfare system favors retirement most.
• Slovakia’s economy favors retirement most.
• Latvia’s demographics favor retirement most.

Top 10 countries with retirees most likely to return to work

Considering the current state of welfare systems, financial conditions, and demographics in developed nations, Poland stands out as the country where retirees are most inclined to rejoin the workforce. This unfortunate distinction stems from its position as having the second worst welfare system and the eighth least favorable economy for retirement, creating challenging circumstances that often compel retirees to seek employment again.

Italy, despite boasting a stronger-than-average economy, faces a unique challenge with its retired workforce. Many Italian retirees are anticipated to return to work, largely due to the country’s third-worst welfare system. Additionally, demographics play a significant role in this trend, as Italy has the highest retirement age for pension claims at 67 years and one of the longest average life expectancies at 84 years. These factors contribute to an increased likelihood of retirees re-entering the job market.

Ireland is among the top three countries where unretirement is on the rise. However, it faces challenges, as it has the second least favorable economy for retirees and the seventh worst welfare system, largely due to its low-ranking healthcare program. Additionally, with only 14.81% of its population being retirees, Ireland ranks tenth in demographics that support unretirement trends.

While not highlighted in the previous list, it's interesting to point out that the United States and Spain rank as the 17th and 18th countries where retirees are most likely to re-enter the workforce. Their similar standings reflect a balance in performance across key indicators.

When it comes to welfare systems, the United States outshines Spain with a stronger healthcare index, while Spain excels with a better national pension plan. Although the U.S. faces a higher cost of living, which encourages more people to delay retirement, Spain’s demographics, including a higher official retirement age, also support this trend. Ultimately, both countries share similar challenges that contribute to the growing phenomenon of the Great Unretirement.

Countries with welfare systems that least favor retirement

Saudi Arabia leads the rankings for the least effective welfare system among advanced nations. Its national pension plan is notably deficient, earning the title of the 5th most inadequate retirement allowance. The healthcare program is similarly lacking, positioned as the 6th weakest in the analysis. Given the challenges of insufficient pensions and subpar healthcare, it’s no surprise that many retirees find themselves reentering the workforce.

Poland ranks as the fourth lowest in pension allocations and has the eighth least effective healthcare system, just behind Saudi Arabia. Italy follows, offering its citizens better healthcare services (14th place) but falling short in retirement plans (3rd place). Meanwhile, Romania and Russia occupy the top five positions for inadequate welfare, characterized by average pension programs and subpar healthcare, which places them as the third and fourth worst systems, respectively.

Countries with economies that least favor retirement

Israel ranks as the least supportive country for retirement, primarily due to its high cost of living, which is the sixth highest globally, combined with below-average incomes for those over 65. These financial challenges often compel retirees to re-enter the workforce. Additionally, with a low unemployment rate of just 3.17%, many individuals choose to remain in or return to their jobs, reflecting the tough economic landscape for seniors in the Holy Land.

Ireland ranks a close second to Israel, largely due to its more affordable cost of living. However, it has a lower average income for seniors and a lower unemployment rate of 2.9% compared to Israel. Meanwhile, the United Kingdom, Ireland's British neighbor, comes in at #7 on the list. The UK offers a slightly lower cost of living and higher average earnings for elderly residents than both Israel and Ireland.

Countries with demographics that least favor retirement

Israel has once again claimed the top spot, this time regarding national demographics that indicate retirees are more likely to re-enter the workforce. Notably, Israel boasts the second smallest percentage of retirees at just 12.22%. This suggests that many individuals are either choosing not to retire or are returning to work after retirement. This trend is likely influenced by the challenging economic conditions surrounding retirement in the country.

Moreover, Israel shares the title of having one of the highest official retirement ages—67 years—alongside four other countries. This aligns with the nation's impressive average life expectancy of 83.49 years, ranking 9th globally. As a result, many Israelis are more likely to re-enter the workforce after retirement, given the extended wait for their pensions and their longer lifespans.

Iceland mirrors Israel with the second-highest retirement age at 66.5 years, the fifth smallest percentage of retirees at 14.86%, and the seventh longest life expectancy at 83.52 years. In contrast, Norway and Australia rank third and fourth, respectively, with a higher percentage of retirees. However, their life expectancies vary: Norwegians have an average lifespan of 82.94 years, placing them 14th, while Australians enjoy a slightly longer life at 83.94 years, ranking sixth, just behind Spaniards who average 83.99 years.

Top 10 countries with retirees least likely to return to work

When we analyze the data from a fresh angle, we discover that developed nations show a lower likelihood of unretirement, with Denmark standing out as a leader in this trend. This is largely attributed to its highly regarded welfare system, which provides exceptional financial support to retirees.

Finland ranks just behind its Nordic neighbor, Denmark, in terms of retirement support. With an impressive welfare program that is the fourth best in the world, Finland boasts a substantial retirement population, making it the third largest with 22.87% of its citizens in retirement. While both Denmark and Finland face economic challenges for retirees, Finland outperforms Denmark in providing a more favorable environment for those in their golden years.

Rounding out the top three is the Netherlands, celebrated for having the third-best welfare system in Europe. Following closely is Bahrain, which ranks fourth for its appealing demographics for retirees. Not to be overlooked, Brunei claims the fifth spot, boasting the third most supportive economy for those enjoying retirement.

Australia surprisingly ranks 7th on the list of best countries for retirement, despite having the 4th least favorable demographics and the 12th least suitable economy for lifelong retirement. This paradox is largely due to its exceptional national welfare program, which is rated 2nd best globally. This strong support system helps secure its place among the top developed nations where retirees are most likely to enjoy a comfortable retirement.

Several English-speaking countries narrowly missed the top 10 retirement rankings, including the UK at #11, the Bahamas at #12, and Canada at #14. Each of these nations excels in specific areas that support retirement. The UK leads in welfare, ranking #9, while Canada shines in economic conditions, coming in at #18. Meanwhile, the Bahamas boasts the best demographics, securing the #10 spot. These unique strengths could play a crucial role in minimizing the trend of unretirement in their respective countries.

Countries with welfare systems that most favor retirement

Denmark stands out as the top country where retirees are least likely to reenter the workforce, a testament to its exceptional welfare system, which ranks first among advanced nations. With the second-highest healthcare index and the third-best national pension system, Denmark effectively eases retirees' worries about two of their most critical financial concerns: health care and pensions.

Similar to Denmark, Australia excels in national health care, securing the 5th position, compared to its 6th place in pension plans. Despite this, Australia proudly holds the overall 2nd place in welfare. The Netherlands follows closely in 3rd place, ranking 2nd in retirement allowances but 10th in health care services. Finland, ranked 4th, boasts the 5th best pension system and the 11th best health care program. In contrast, South Korea ranks 5th overall, thanks to its top-notch health care, which offsets its average pension system.

Countries with economies that most favor retirement

Slovakia stands out as the top country for retirement due to its exceptional economic conditions. It boasts the fourth lowest cost of living, alongside above-average income levels for seniors. This combination allows retirees to maintain a comfortable lifestyle without financial strain. Additionally, with an unemployment rate of 5.2%, the eighth lowest in the dataset, it suggests that the economy is less dependent on employment, providing retirees with more financial freedom.

The next three countries on the list are #2 Romania, #3 Brunei, and #4 Croatia, all of which boast some of the most affordable living costs among industrialized nations. Romania ranks as having the second lowest average cost of living, followed closely by Brunei and Croatia, which occupy the seventh and eighth spots, respectively.

Countries with demographics that most favor retirement

Latvia ranks as the top country for demographics that align with sustainable retirement, but it's a double-edged sword. With an average lifespan of just 75.53 years—one of the shortest globally—fewer individuals reach retirement age, impacting the workforce significantly.

Latvia boasts the youngest official retirement age in Europe at just 64 years, allowing retirees to access their state-funded pensions sooner and reducing their incentive to return to the workforce. Furthermore, with 20.84% of its population being retirees, Latvia demonstrates a robust retirement system that effectively supports a significant segment of its citizens.

Russia holds the second spot in demographics that favor retirement, largely due to its lowest life expectancy worldwide at 72.99 years and one of the youngest retirement ages at 61.5 years. Following closely, the Czech Republic ranks third, thanks to its similarly low retirement age of 62.83 years and a notable retiree population of 20.57%.

How is the cost of living crisis affecting pensioners globally?

The ongoing global cost of living crisis is characterized by sluggish economic activity and escalating inflation, largely a result of the financial fallout from the COVID-19 pandemic and Russia's invasion of Ukraine. The World Economic Outlook Report highlights this trend, revealing that economic growth plummeted from 6.0% in 2021 to just 3.2% in 2022, while inflation surged from 4.7% to 8.8% during the same period.

Soaring food costs, rising fuel prices, and growing debt have put the global economy in a precarious position, prompting the UN to declare it the worst cost of living crisis of the 21st century. As a result, many pensioners are finding that their retirement plans are no longer viable in today’s challenging economic landscape.

A recent survey of older workers in the UK revealed a striking trend: over 30% of retirees have either re-entered the workforce or are contemplating doing so. Nearly 70% of these individuals attributed their decision to financial concerns. This shift is largely driven by the ongoing cost of living crisis, which is prompting many retirees to join what is being termed the "Great Unretirement."

Conclusion

Since the onset of the COVID-19 pandemic, we've seen a surge of new employment trends, such as the Great Unretirement, reshaping the business landscape. Although these changes can pose challenges for your organization, understanding these emerging phenomena is your best strategy for success. By adapting your corporate approach—such as providing corporate English training or enrolling employees in business English courses—you can better navigate these evolving times.

Methodology: 

To establish our rankings, we examined eight critical data points related to retirement across the 45 wealthiest countries, as measured by adjusted GDP per capita. These data points were categorized into three main groups: welfare systems (including healthcare access and national pension schemes), economic factors (such as cost of living, average income for those over 65, and unemployment rates), and demographic trends (covering official retirement age, the percentage of retirees, and average life expectancy).

We assigned specific weightings to various categories and calculated a composite index score for each country, with scores ranging from 0 to 100. Finally, we ranked the nations based on these scores, revealing the top 10 countries where retirees are most and least inclined to re-enter the workforce.