Long term economic impact of mass early retirement ?

michaels

bluenose1 said:

Thrugelmir said:

Technology has removed the need for many tiers of management and supervisory levels over the past 30 years. 

I was reading a book recently about automation. The conclusion was that computers are now cleverer and will be able to do most things a human brain would normally be required for faster and cheaper. 
 Big corporations are investing a lot of money in this as the potential savings are massive. Whereas before workers have been able to move into other areas the reasoning  is that Intelligent computers will be able to do the vast majority of jobs. Even roles like Doctors as the algorithms can diagnose more illnesses correctly than a human Doctor. They are even training them so they are voice empathetic based on each individual patient. 

It was quite sobering and I do worry about the future of work for our kids etc. 

Don't worry, the technology singularity is likely around 2045 at which point the only humans around to care will be those kept by our computer overlords as pets who will probably feel very pampered by whatever facilities they are allowed.

NottinghamKnight

michaels said:

bluenose1 said:

Thrugelmir said:

Technology has removed the need for many tiers of management and supervisory levels over the past 30 years. 

I was reading a book recently about automation. The conclusion was that computers are now cleverer and will be able to do most things a human brain would normally be required for faster and cheaper. 
 Big corporations are investing a lot of money in this as the potential savings are massive. Whereas before workers have been able to move into other areas the reasoning  is that Intelligent computers will be able to do the vast majority of jobs. Even roles like Doctors as the algorithms can diagnose more illnesses correctly than a human Doctor. They are even training them so they are voice empathetic based on each individual patient. 

It was quite sobering and I do worry about the future of work for our kids etc. 

Don't worry, the technology singularity is likely around 2045 at which point the only humans around to care will be those kept by our computer overlords as pets who will probably feel very pampered by whatever facilities they are allowed.

but Arnie will be back!

MK62

Thrugelmir said:

With fewer children being born. The long term projections are for the population sizes of developed world countries to fall. The post war baby boom generation is now beginning to hit it's peak. 

Not for the UK......at least according to the ONS....
https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationprojections/bulletins/nationalpopulationprojections/2018based

.....though it does say it doesn't attempt to take into account Brexit....😉

cfw1994

bluenose1 said:

Thrugelmir said:

Technology has removed the need for many tiers of management and supervisory levels over the past 30 years. 

I was reading a book recently about automation. The conclusion was that computers are now cleverer and will be able to do most things a human brain would normally be required for faster and cheaper. 
 Big corporations are investing a lot of money in this as the potential savings are massive. Whereas before workers have been able to move into other areas the reasoning  is that Intelligent computers will be able to do the vast majority of jobs. Even roles like Doctors as the algorithms can diagnose more illnesses correctly than a human Doctor. They are even training them so they are voice empathetic based on each individual patient. 

It was quite sobering and I do worry about the future of work for our kids etc. 

Despite the jokey replies above, I think this is a serious point (speaking as someone who has spent their career working in the technology sector!).
I’m no Luddite (but do live a few miles from a road named after Ned Ludd!!), & certainly some new opportunities will rise up....but I do think we need to consider UBI (universal basic income) & how to fund that.  Finding better ways to tax the huge corporations more fairly would be a decent start.  Figuring out how to tax machines will be next: Jonnycabs is closer to reality than you might think!
To the OP, I suspect there will be some minor loss of revenues, but it will be a drop in the ocean: as others said, the vast majority are poorly prepared for finishing their working life early.  

Dansmam

green_man said:

It is an interesting question.

I retired at 47 (now 54) I was a higher rate tax payer and if I was still working I would have continued to be so. Since retiring I have been a non (income based)tax payer.  

So is the gov drawing in less tax due to my retirement? I don’t think so.  Basically someone else is doing my job, someone will have moved up into my role, this allows the usual job progression you get in a large company and ultimately enables them to take on more graduate level starters, without these opportunities it’s this age group than can struggle to establish their careers and become a burden on the state.

So overall I don’t think retiring early does  reduce tax take.  The only time it would be a big issue is if we have near 100% employment.

I think this is a key point. Retiree tax goes down but stepping out of the work market opens opportunity for others. Particularly in the kind of area where dead wood sticks around only for pension reasons. I decided to step out and leave the road clear once my savings could bridge me to pension. Seemed like the right thing to do for many reasons. But the (income) tax take from me will be nil for the next couple of years. Someone else is paying the tax I used to.

Cus

barnstar2077 said:

Anonymous101 said:

barnstar2077 said:

Mickey666 said:

green_man said:

It is an interesting question.

I retired at 47 (now 54) I was a higher rate tax payer and if I was still working I would have continued to be so. Since retiring I have been a non (income based)tax payer.  

So is the gov drawing in less tax due to my retirement? I don’t think so.  Basically someone else is doing my job, someone will have moved up into my role, this allows the usual job progression you get in a large company and ultimately enables them to take on more graduate level starters, without these opportunities it’s this age group than can struggle to establish their careers and become a burden on the state.

So overall I don’t think retiring early does  reduce tax take.  The only time it would be a big issue is if we have near 100% employment.

Agreed.  Well done on 47 btw, I only managed 49   But you're absolutely right about the job still existing (unless you were genuinely made redundant) and it was the same for me, so that job is providing the taxman with tax and NI.  In fact, the taxman is presumably even better off because as well as my old job still contributing to the taxman's coffers, so am I because I'm still economically active and spend my pension money as well as other savings and investments, all of which contributes to the economy.

So I can't really see how early retirement can be detrimental to the economy unless there is a labour shortage.

And no, I don't have any other part-time employment, nor have I ever wanted any.  I'm now far too busy pursuing all my other interests.  Indeed, I sometimes wonder how I ever found time to go to work at all! (the answer, of course, is by neglecting some of my other interests).

Retiring sub 50 is quite an achievement indeed!  Some people I have met react quite badly to others good fortune, but personally I am always impressed and inspired by other peoples accomplishments.

I agree - it’s very impressive to hear of people retiring in their 40’s. It often requires years of planning and living below your means. I’m sure there’s an element of good fortune to some people’s stories but most I think are more hard earned.

I’m always interested in people’s reactions when people discuss this topic too, as you say many people seem to react really negatively to this. As if they are of the opinion that you have to spend everything you earn and it is somehow insulting to them if you don’t. Or looking from a work perspective they find it insulting that you don’t live to work.

You are correct, good fortunes was not the term I was looking for.  Perhaps "success" would be a better fit.  To also expand about some peoples negativity, jealousy is often a reaction I see a lot when others achievements are mentioned.  It is as if some people think that there is only so much success to go round, and that those that have achieved it are in some way reducing their own chances.  Some people is weird!

I think the outward jealousy is often due to those people regretting that they didn't manage the same, often due to poor decisions, laziness etc.

Linton

To return to the original question...
I dont see much problem with reduction in the workforce through early rertirement.  Look back to previous decades.  In the 1950s there were 700,000 miners.  A few years later there were a 250,000 people working at British Leyland.  100,00s were working on the railways.  The largest class of workers was uhskilled/semi skilled labourers.

With automation were are now seeing single factories amploying perhaps  a few 1000 people producing a sizeable fraction of the national demand for some individual products.  Agriculture workers who were once the large majority of the workforce are now down to perhaps 1-2% with no loss of total production.

Now most people's work is far removed from production as they are not needed there.  Are all their efforts really necessary or is it purely working because that's how the economic system distributes wealth?

EdSwippet

Thrugelmir said:

Technology has removed the need for many tiers of management and supervisory levels over the past 30 years. 

Computer says no <Cough>

Brenster

I think for the current generation it will be much more difficult to achieve early retirement, through a combination of cost of living, tax increases, house prices, the costs / debt associated with their own education and the cost of their current / future children's education.......... 

iamnotasoldier

Thanks to all for chipping in on this. It was a random thought I had whilst browsing this forum. I perhaps used the wrong word in the post heading - "mass" ! More correct would have been "significant". Reading through, some great points - forum probably not indicative of wider society ie the norm is people are ill prepared for retirement, peak DB pensions & the disappearance of those, with less generous schemes & the raising of the age to 57 to allow people to withdraw from any schemes. Be interesting to see the effect of falling birth rates, aging population & great point on automation.