November 2019. Strikes have disrupted France over the past few weeks, as labor unions angry over President Emmanuel Macron’s planned pension overhauls have ground trains to a halt, kept some schools closed, and taken to the streets to pressure the government. The protests represent the biggest domestic showdown for Mr. Macron since the Yellow Vest movement last year, and they are testing his reformist zeal as he tries to overhaul a complex but generous pensions system. The strikes have affected transportation more than any other sector, and have been especially acute in Paris, putting frustrated travelers and weary commuters in the middle of the dispute. The French pension system has a redistributive, pay-as-you-go structure that functions like group insurance. Workers and employers pay mandatory payroll taxes, known as social contributions, which are used to fund the pensions of retirees. Workers can also build up their own savings, but that does not constitute the backbone of the system, and private plans like 401(k)’s are uncommon. Full benefits are earned after 41 years to 43 years of contributions, depending on when workers were born, but they can retire earlier than the legal age of 62 without full benefits. Those are the general principles, at least: In practice, the system is complicated by 42 different pension programs.
Nov 2019. Pension Crisis in France
