Krista Jaakson, an economist at the University of Tartu, and her colleagues analyzed data from the Organization for Economic Co-operation and Development (OECD) to determine the number of older workers actively employed in various countries. Internationally, an older worker is defined as someone aged 55 or older.

"Data from 2022 showed that nearly 74 percent of people aged 55-64 in Estonia were employed. This is slightly less than in Norway, where the figure stood at 74.5 percent, and Sweden, where it was 77.3 percent. However, we ranked higher than all the other countries," Jaakson noted.

The situation becomes even more striking when looking solely at working pensioners. In Estonia, a remarkable 35 percent of people aged 65-69 are employed, compared to the European Union average of just 16.7 percent across 27 countries. In other words, Estonia's labor market has twice as many working pensioners as the EU average.

To delve deeper into these numbers, the study authors turned to data from CRANET, an international network that connects researchers in the field of human resource management. "Roughly every five years, this network helps conduct a large survey of HR managers in various countries. We represent Estonia within this network," Jaakson explained.

A limitation of the study, she highlighted, is that it only surveyed larger companies with at least 100 employees. This means it does not reflect the situation of older workers employed by smaller firms. "We asked ourselves: if we have so many older people in the labor market, could it be assumed that our companies offer highly age-friendly and caring environments?" Jaakson pondered.

Periodic surveys aim to identify whether companies have programs for recruiting older workers, training opportunities specifically for older employees, options for part-time work or employer-sponsored additional pensions. "Regardless of which question we looked at, it was clear that the Baltic countries lag behind the Nordics, with fewer companies focusing on older workers," she remarked.

Need to keep working

Researchers attributed the significantly lower level of age-friendliness among companies in the Baltic states primarily to poverty. "Our pensioners are compelled to work. Companies do not need to make extra efforts to keep them employed. In the Nordic countries, pensioners could comfortably live without having to work," Jaakson noted.

"Given that there is a labor shortage everywhere, companies there must strive to retain older workers. Our companies, on the other hand, are in a stronger position because of the general poverty," she added.

In some indicators, Estonia even lags behind other Baltics. "Where Estonia really falls short is in hiring policies for older workers. Just 1 percent of larger Estonian companies reported having any such policies, compared to 8 percent in Latvia and Lithuania," Jaakson highlighted.

Jaakson could not definitively explain this disparity but speculated that a non-discriminatory mindset, both negative and positive, might be characteristic of the Estonian mentality. "It reflects both the good and bad in Estonians. We often resist even positive discrimination. If we know that a group is in a more vulnerable position and needs support, there is still a reluctance to act differently. It seems like everyone must be treated equally. This is evident in the ongoing debates, for instance, around women's quotas on organizational boards," she suggested.

Looking at all indicators together, Jaakson pointed out that Baltic companies generally fall behind Nordic ones, particularly in offering employer-funded pensions and additional health insurance. "This is surprising, given that the Nordic countries already have a strong and supportive state pension system. Yet, large companies there still widely offer these extra benefits," she said.

In Estonia, only 2 percent of companies surveyed provide additional pension contributions, such as to the third pillar of the pension system, compared to 76 percent of companies in Norway, 50 percent in Sweden, 45 percent in Denmark and around one in four in Finland. "The difference compared to Estonia is vast," Jaakson said.

She suggested that time may play a role in this disparity. "The systems in the Nordic countries have been in place for a long time, whereas our companies, during the post-independence period, have simply not had time to focus on such initiatives," Jaakson speculated.

Jaakson also noted Estonia's self-promotion as a digitally advanced country with extensive remote work opportunities. However, Estonian companies are on par with those in Latvia and Sweden in terms of enabling remote work, while even more companies in Norway and Finland offer such possibilities.

Another intriguing topic, according to Jaakson, relates to early retirement policies, where employers effectively provide a pension before state pension eligibility begins, allowing employees to rest at home on the company's expense. "Given the demographic situation, everyone capable of working should remain in the labor market, which makes such policies less age-friendly today," Jaakson explained.

"The European Commission has also started to discourage such programs. However, they still exist in some Nordic companies. In this respect, one could say the Baltic countries outperform the Nordics," Jaakson joked.

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