Greece sees mass retirement wave as EFKA applications exceed 200,000 annually

Greece is experiencing a significant wave of mass retirements, with over 200,000 pension applications being submitted annually to the EFKA social security system.

Contrary to rumors regarding rising retirement ages, the trend is driven by economic factors. A primary cause is the decline in wages and the retreat of sectoral collective agreements. Because pension amounts are calculated based on average earnings from 2002 until the application date, recent wage stagnation compresses the final pension amount, making continued employment economically unattractive.

Additionally, the current insurance system offers diminishing returns for long-term workers. While there are strong incentives for those contributing between their 35th and 40th years, the annual increase in the return coefficient drops to just 0.5% after the 40th year of insurance. Finally, the ability to immediately collect lump-sum benefits provides necessary liquidity for families, further encouraging immediate retirement.