ECONOMY

Nightmare scenarios for pension system

nightmare-scenarios-for-pension-system

Social security experts and the government are having to consider nightmare scenarios with unemployment above 20 percent and a recession of close to 12 percent once the coronavirus pandemic has subsided.

The fiscal turbulence is also expected to affect forecasts for the social security system, as the revenues of the main pension fund (e-EFKA) are expected to plummet, which means that the state will have to step in and help out.

There was no time for the interventions legislated for pensions, social security contributions and the structure of the funds to be implemented before the pandemic hit, and experts consider it likely that a new reform will be required, which won’t be as favorable as the previous one.

Analysts in Greece are taking it for granted that the jobless rate will not only rebound for the first time after 2013 but in some extreme scenarios could reach 22 percent.

Some estimates say that about 50,000 jobs will be lost for each percentage point of economic contraction, and there is talk of half a million job losses from early March to the end of the year.