An American friend asked me recently whether all those Europeans traveling through the United States for the World Cup had months of paid vacation.
No. They do not.
Europeans do have more vacation time than most Americans. Under European Union rules, workers are entitled to at least four weeks of paid annual leave. Many countries and collective agreements go beyond that.
For decades, Europeans looked at the United States with a mixture of pity and superiority. Americans worked too much, saved too much on their own and carried too much private risk.
The OECD’s 2025 tax-wedge numbers show the other side of that bargain. Belgium was highest, at 52.5% for a single average worker. Germany followed at 49.3%. France was at 47.2%, Austria at 47.1% and Italy at 45.8%. The OECD average was 35.1%.
The tax wedge measures the gap between what it costs to employ a worker and what that worker takes home after income tax and social-security contributions. Paid vacation is easy to notice. So are public insurance cards and pension promises. The deductions that fund them are harder to admire.
Europe built much of its welfare state for societies with more children, stronger growth and more young contributors. On Jan. 1, 2025, 22% of the EU population was already 65 or older. Eurostat projects the working-age share of the EU population, those aged 20 to 64, to fall from 58% in 2025 to 50% by 2100.
Germany shows the pressure clearly. Its public pension depends heavily on today’s workers paying for today’s retirees. The regular retirement age is already rising to 67 for Germans born in 1964 or later. A government-appointed pension commission has discussed a Swedish-style funded pension element, mandatory contributions and a gradual increase in the retirement age linked to life expectancy. Reuters reported that such a path could eventually push retirement toward 70.
France has already fought over pension reform in the streets. Italy has one of Europe’s oldest populations. Belgium taxes labor even more heavily than Germany. The national arguments differ. The pressure moves in the same direction.
That is what the World Cup can hide for a few weeks. European fans arrive in American cities, follow their teams, drink beer, take extensive road trips and appear to have escaped work for half the Summer.
Now the bracket has added its own little economic joke.
The United States faces Belgium next, the only OECD country with a higher tax wedge than Germany. If America wins, it will not just reach the quarterfinals. It will send home the developed world’s reigning champion of labor taxes.
Paraguay already beat the Germans in the round of 32, and sent them back to work.
The United States should probably win the whole thing now. They can afford the overtime. The European teams have pension systems waiting at home, and somebody has to keep the contributions flowing.
