Gender pension gap economic perspective Agnieszka Chłoń-Domińczak Institute of Statistics and Demography SGH Part of this research was supported by European Commission 7th Framework Programme project "Employment 2025: How will multiple transitions affect the European labour market' (NEUJOBS)
Outline Life course changes and challenges in the light of population ageing Gender pension gap: current and future perspective Changing labour market patterns Changing pension system design How to measure gender pension rights gap Policy challenges
Rationale In most of the countries there is a current pension gap, measured by differences in pension levels of men and women The gender gap is a result of: Gender differences in labour market participation (wages, employment rates) Pension system design (retirement age, pension formula)
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 per cent per cent Length of pension coverage depends both of on the labour market entry and exit ages Spain Age profile of employment rates Sweden 0,90 0,80 0,70 0,60 0,50 0,40 0,30 0,20 0,10 0,00 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 0,90 0,80 0,70 0,60 0,50 0,40 0,30 0,20 0,10 0,00 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 age group age group 1992 - women 2001 - women 2011 - women 1996 - women 2001 - women 2011 - women Hypothetical years in employment 30 37 25 20 15 10 36 35 34 33 32 5 31 0 30
Current vs. future replacement rates projected change Source: The 2015 Pension Adequacy Report: current and future income adequacy in old age in the EU
Career breaks for child-care and pension rights Type of trend 1. Increases from the full-career case and decreases afterwards 2. Stable during the child-care breaks (no change) 3. Stable for first few care years and declining thereafter 4. Decreases modestly from the full career case 5. Stronger declines in replacement rates Source: (D Addio 2013) Countries (2): Germany, Italy (1) Ireland (6) Belgium, Czech Republic, Luxembourg, Portugal, Spain, Malta (6) Austria, Denmark, Finland, Greece, Netherlands, United Kingdom (11) France, Hungary, Poland, Slovak Republic, Sweden, Bulgaria, Estonia, Latvia Lithuania, Romania, Slovenia
Future gender pension gap depends both on labour market and pension system factors Pension rights gap Labour market Pension system Employment years gap Career break gap Wage gap Low wage redistribution Pension indexation Retierement age differential
Estonia Slovakia Latvia Czech Rep. Hungary Lithuania Poland Slovenia Romania Bulgaria Denmark Malta Finland Belgium Italy Portugal Sweden Austria Spain Ireland Greece Cyprus France Netherlands UK Germany Luxembourg Current vs future 80 70 60 50 40 30 20 10 0-10 -20-30 Current Gender Pension Gap Future Gender Pension Right Gap
Pension system compensation Distribution of EU 27 countries by the domain specific indices High Medium Low Labour market equality High Medium Low (4) SI DK UK NE (3) CY LU FI SE (1) PT (3) DE LT BE (3) IE AT LU (4) PL FR LV BG (2) EE CZ (2) MT ES (5) IT RO SK HU EL
Conclusions The results of analysis show that countries that have little gender differences in labour markets also tend to have pension system policies that are gender-friendly Countries with high gender differences, pension systems often do not compensate them at retirement There is a need for more life course perspective in both labour market and retirement policies, taking into account the complimentary role of these policies
Conclusions The position of women in labour market and family context is changing Policy responses to population ageing include both changes in labour market and pension systems that affect gender differently increases in the labour market participation of prime-aged women, prolonging working lives increasing labour market exit ages of women raising retirement age reducing the progressivity in pension formulae,
Conclusions Full understanding of transition from work to retirement requires the assessment of both sides of the coin Women lose twice in most of the pension schemes because they earn less and because they have shorter working lives Many researchers refer to these gaps, but rarely they are seen as correlated phenomena women with shorter working lives have usually lower earnings at the same time Gender is important in combined labour market and pension system perspectives
Further reading: FEMALE TRANSITION TO RETIREMENT Neujobs project working paper http://www.neujobs.eu/sites/default/files/d16.2b.pdf WOMEN S WORK AND PENSIONS. DRAWING LESSONS FROM CENTRAL AND EASTERN EUROPE In. B.Marin(ed.) The Future of Welfare State in a Global Europe http://www.euro.centre.org/data/1441432754_18933.pdf Contact: agnieszka.chlon@gmail.com