Research shows the ratio of retirees to workers in the UK is becoming unsustainable as populations age and birth rates fall.
Anyone born after April 1970 in the UK may have to work until they are 71, according to a new report from the Longevity Centre.
The current age threshold to draw a state pension is 66 years old, although it is projected to rise to 68 by 2044.
Experts say a gradual hike is necessary to maintain the status quo of the constant number of workers per state pensioner.
If the proportion of retirees to workers grows, there is likely to be a lack of employees to keep up with rising consumer demand, the report says.
The labour disparity is more of an immediate problem in the UK than in less developed nations because of long life expectancy figures and falling birth rates.
The pandemic, along with Britain’s austerity years and a rise in mortality rates, means there has been a temporarily easing of pressure on pension budgets.
Covid-19, however, resulted in periods of inactivity or working from home for people of working years and left older citizens pushed out of the workforce.
Looking at early-retirees, the Longevity Centre also noted that many UK employees were leaving the workforce prematurely because of preventable health conditions.
Only50% of adults in England and Wales are now disability-free and would be able to work up until the age of 70, according to the report.
Looking after the health of employees before it deteriorates should therefore be a priority for governments, according to the Longevity Centre.
“Policymakers can no longer ignore the impact of poor health on wider society and doing so will simply make wider policies related to work or pensions ineffective,” the report said.
Figures published last week by the Office for National Statistics (ONS) showed that the UK population is projected to grow from an estimated 67 million in mid-2021 to 73.7 million by mid-2036.
Pensioner benefit spending is expected to cost £138 billion in Great Britain between 2023 to 2024.
£125 billion of this will be spent on state pensions, while some will go towards housing benefit for retirees, and pension credit for those on a low income.