The document discusses the implications of changing labor markets on pensions, emphasizing the transition from traditional life-course patterns to more fragmented career paths that affect pension systems. It highlights various challenges such as increasing intergenerational poverty, gender disparities in employment and pension entitlements, and the need for policy responses to address these issues. The conference at the Finnish Centre for Pensions aimed to explore these themes through presentations and discussions among experts in the field.

1. Welcome!
Opening words:
Mikko Kautto, Director
Research, Statistics & Planning

2. Conference organisers
• Finnish Centre for Pensions (ETK)
in cooperation with
• ESPAnet (the European Network for Social Policy
Analysis)
• European Sociological Association (ESA),
Research Network on Ageing in Europe
• University of Helsinki
• Social Policy Association in Finland
219 May 2017Mikko Kautto Finnish Centre for Pensions

3. Practicalities
• WLAN codes (e Vieras)
– username: etkvieras
– password: 47ens8mk3
• Tweets: #etkconference
• Live streaming (available also later), background
and speaker presentations at our website
etk.fi/en > Research > Seminars > Conference 2017
319 May 2017Mikko Kautto Finnish Centre for Pensions

4. 419 May 2017Mikko Kautto Centre for Pensions
• Fordist, Taylorist world of work
• Material work, industrial production
• Local & immobile
• Process-orientation
• Hierarchies & collectives
• Rules, details & limits

5. 519 May 2017Mikko Kautto Centre for Pensions
Modern work
• Immaterial, service-economy
• Global, mobile & digital
• Innovation, result-orientation
• Networks & individuals, face-to-face
• Self-guidance, self-employment

6. What do changes mean for pensions?
• The traditional life-course pattern ”study, work & retire”
is being replaced by more fragmented life-courses, that
include a variety and multitude of different actions and
statuses
 Pension systems need to adapt to the on-going
changes
• In Finland, earnings-related pensions are based on
– the number of months/years with insured earnings between
the ages of 17 to 68 years
– the level of annual earnings
• Pension accrues also for specified non-paid periods
• For those with a limited work-history, the national
pension and the guarantee pension offer basic security
619 May 2017Mikko Kautto Finnish Centre for Pensions

7. First Session:
Changing Labour Markets and Old-age Security
• Presentations
– Anna d’Addio (Senior Pension Policy Analyst)
– Dirk Hofäcker (University of Duisburg-Essen)
– Traute Meyer (University of Southampton)
• Comments:
– Katja Veirto (Akava)
– Jaakko Kiander (Ilmarinen)
• 11.30-12:30 Lunch
719 May 2017Mikko Kautto Finnish Centre for Pensions

8. LIFE COURSE, CAREER
BREAKS AND PENSIONS:
ISSUES AND CHALLENGES
IN AN INTERNATIONAL
PERSPECTIVE
Anna Cristina D’ADDIO
Senior Policy Analyst
•“Changing Labour markets, Life Course and
Pension”, Finnish Centre for Pensions
•Helsinki, 19 May 2017

9. 9
OUTLINE
 The context
 Challenges and risks for pension systems
 Conclusions and policy implications

10. 10
SETTING THE CONTEXT…
 (Post-)crisis
 Low growth
 High unemployment
 Rapid population ageing

11. LIFE EXPECTANCY: THE SHARE OF THE
ELDERLY WILL INCREASE SUBSTANTIALLY
11
Sources: data from The 2015 Ageing Report, European Union
1,2
0
5
10
15
20
25
30
35
40
IE
LU
NO
BE
SE
DK
UK
FR
LT
FI
CY
NL
OECD22
LV
CZ
EU28
MT
AT
RO
SI
HU
HR
EE
IT
ES
BG
DE
EL
PL
PT
SK
2013 2060

12. 0
10
20
30
40
50
60
70
LU
IE
NO
BE
SE
DK
UK
FR
FI
LT
NL
OECD22
CZ
EU28
LV
AT
MT
RO
HR
SI
HU
IT
ES
EE
BG
DE
EL
PL
PT
SK
2060 2013Number of elderly people per
working age people
THE NUMBER OF ELDERLY (65+) PER
WORKING-AGE (15-64) PEOPLE WILL
INCREASE …
12
Sources: data from The 2012 Ageing Report, European Union

13. 13
WHILE POPULATION WILL TEND
TO SHRINK…
Source: OECD (2015) OECD Family Database
Total fertility rate, 1970-2014
1
1.2
1.4
1.6
1.8
2
2.2
2.4
2.6
2.8
3
Italy Northern Europe Southern Europe All other OECD Europe OECD averge
Italy
Northern Europe
Southern Europe
OECD average
All other OECD Europe
Replacement level
WHILE THE POPULATION MAY SHRINK

14. IMPLYING A SMALLER NUMBER OF
CONTRIBUTORS FOR RETIREES IN MANY
COUNTRIES…
14
Number of contributors for 100 pensioners
Sources: data from EU (2015) The 2015 Ageing Report, European Union

15. 15
IN FINLAND: PUBLIC EXPENDITURE ON
PENSIONS IS PREDICTED TO BE NEARLY
STABLE
Source: EU (2015) The 2015 Ageing Report
8.4

16. 16
TRENDS OF PENSION REFORMS
 Financial sustainability has driven many reforms in recent
years
 Retrenchment of public pensions
 low earners generally better protected
 Net pension replacement rates according to OECD
pension models were lower for average wage relative to
low earners
 Expansion of private pensions …but also reversal in some
countries
 Expanding coverage for both private and public pension
 Enhancing administrative efficiency and transparency of
pension systems
 But retirement-adequacy is critical

17. 17
REPLACEMENT RATES FOR FUTURE RETIREES
WILL VARY SUBSTANTIALLY ACROSS
COUNTRIES…
0
20
40
60
80
100
120
MEX
CHL
GBR
JPN
IRL
CAN
NZL
USA
KOR
CHE
DEU
POL
GRC
EST
BEL
OECD34
FIN
SWE
CZE
DNK
FRA
ISL
ITA
LUX
ESP
PRT
HUN
AUT
NLD
TUR
Total net
with voluntary
% Future net RR for average wave workers
17
Source: OECD pension models

18. THE CAREER OVER THE LIFE
COURSE…

19. PEOPLE SPEND TIME OUT OF PAID
EMPLOYMENT FOR MANY
REASONS
Education, unemployment, caring for
children or elderly relatives, sickness and
retirement are some….
AMONG EMPLOYED PEOPLE
DIFFERENCE EXIST ACCORDING TO
Education, gender, number of children,
age of the children for example….

20. 20
THERE IS A LARGE DIVERSITY IN
EMPLOYMENT PROFILES OVER THE LIFE-
COURSE BETWEEN GENDERS…
Employment rates over the life-
course
0
10
20
30
40
50
60
70
80
90
100
Men Women
Source: OECD (2015) Pensions at a Glance 2015, Chapter 3
OECD
average

21. FEMALE LABOUR FORCE PARTICIPATION IS
LOWER RELATIVE TO MEN’S
21
Female and male labour force participation rates (15-64 year olds), 2015 or latest available
OECD Labour Market Indicators
55.20
67.20
0
10
20
30
40
50
60
70
80
90
100
Women Men

22. GENDER PAY GAPS ARE STILL SUBSTANTIAL
IN MANY COUNTRIES
22
Note: Data refer to hourly wage for full time employees (working more than 30 hour per week in the main job), except for Germany, Japan, and Korea for which they refer to monthly
earnings of full-time employees.
Sources: OECD estimates based on EU-SILC for EU countries except for Germany for which they are based on GSOEP, Household, Income and Labour Dynamics for Australia,
Labour force Survey for Canada, National labour force survey for Korea, Basic Survey on Wage Structure for Japan, Encuesta Nacional de Ocupación y Empleo (ENOE) for Mexico,
National Labour Force Survey for Turkey and the Current Population Survey, ASEC Supplement for the United States.
Gender pay gap in median hourly wages, full-time employees, 2014 or latest available
0%
5%
10%
15%
20%
25%
30%
35%
2014 2005

23. 23
WHEN WOMEN HAVE CHILDREN THEIR
EMPLOYMENT DECLINES FURTHER…
Employment rates according to the age (top panel ) and number
(bottom panel) of children, 2014
0
20
40
60
80
100
Youngest child aged 0-2 Youngest child aged 3-5 Youngest child aged 6-14
0
20
40
60
80
100
One child aged 0-14 Two children aged 0-14 Three or more children aged 0-14
Source: OECD (2015), Pensions at a Glance 2015, Chapter 3

24. 24
AND THEY TEND TO HAVE MORE
ATYPICAL CAREERS AND TO WORK
MORE OFTEN IN PART-TIME JOBS
Source: OECD (2015), Pensions at a Glance 2015, Chapter 3
Incidence of part-time among employed workers aged 25-59, 2014
0
10
20
30
40
50
60
HUN
SVK
CZE
EST
SVN
PRT
POL
FIN
KOR
USA
SWE
ISL
DNK
GRC
ISR
TUR
CAN
NOR
FRA
CHL
OECD
ESP
MEX
LUX
NZL
BEL
IRL
ITA
AUS
JPN
GBR
AUT
DEU
CHE
NLD
Women Men% part-time, age 25-54

25. 25
WHAT ARE THE RISKS?
 Intergenerational gaps are increasing:
 Poverty is higher among young and prime-age people
 Unemployment is very high and careers are more precarious
 Employment rates of older workers have increased, while
they have declined for young people but differences persist
 Pensions are a long term issue: financial risks also matter

26. 26
POVERTY RISKS HAVE SHIFTED TO
THE YOUNG OVER TIME
26
50
70
90
110
130
150
170
190
Mid-1980s Mid-1990s 2007 2013 or latest
Relative poverty rate of the population in each year = 100
Poverty rates for each age group relative to population’s
OECD

27. 27
27
12% of young people aged between 15 and 29 were NEETS in
Finland in 2014
Source: OECD (2015) Employment Outlook 2015 and OECD (2015) Pensions at a Glance 2015, Chapter 3
0
10
20
30
40
50
%
Young people experience delayed entry, more
precarious careers and unemployment

28. 28
POVERTY RISK IS ALSO HIGHER
AMONG OLDER WOMEN IN MOST
COUNTRIES…
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
[CELLRANGE]
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
0 0.05 0.1 0.15 0.2 0.25 0.3 0.35
Women'spovertyrates
Men's povertyr ates

29. -20
-15
-10
-5
0
5
10
15
20
25 PT
GR
IS
RO
US
HR
DK
SE
CY
GB
JP
MT
IE
EE
NO
HU
FI
CH
FR
ES
LU
SI
EU28
LV
LT
CZ
PL
AT
BE
NL
IT
BG
SK
DE
Changeinemploymentratesbetween2005and
2014bygender(inp.p.)
Women Men
EMPLOYMENT RATES OF OLDER WORKERS HAVE
INCREASED AND LARGEST CONTRIBUTION TO THIS
INCREASE ARE BY WOMEN …
29
Source: Based on EU LFS data
But differences persit by education, sector of activities, health status…

30. 30
WOMEN’S PENSIONS ARE LOWER
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
SVK
EST
CZE
ISL
DNK
HUN
LIT
LAT
MEX
CHL
POL
FIN
HRY
SVN
ROM
GRC
MAL
NOR
SWE
BUL
PRT
BEL
IRL
ITA
USA
CHE
FRA
ESP
GBR
AUT
NLD
LUX
DEU
GenderPensionGap,2016
OECD-27: 27%
Source: d’Addio (2017) forthcoming

31. 31
HOWEVER, MANY OF THESE WORKERS ARE NOT
EMPLOYED, PARTICULARLY THE OLDER ONES
Employment rates of workers aged 55-69, 2014
Source: OECD Employment Outlook 2015.
8
31

32. 32
FOR BOTH MEN AND WOMEN EXIT OCCUR
EARLIER DESPITE MANY PEOPLE WORK LONGER
France
Spain
Poland
Luxembourg
Finland
Italy
Greece
Slovak Republic
Belgium
Denmark
Netherlands
Germany
Hungary
Slovenia
Austria
Turkey
OECD
Canada
United Kingdom
Estonia
Czech Republic
Switzerland
United States
Ireland
Australia
Sweden
Norway
Iceland
Japan
Chile
Israel
New Zealand
Portugal
Men Women
Korea
Mexico
50 55 60 65 70 75
Effective
Normal
505560657075
Effective
Normal
Source: OECD (2015), Pensions at a

33. WHAT WILL BE THE IMPACT ON
PENSIONS OF DIFFERENT LABOUR
MARKET AND FAMILY SITUATIONS
ON PENSIONS?

34. 34
HOW INCOMPLETE CAREERS
AFFECT PENSION ENTITLEMENTS ?
 The aim: To assess the impact of interrupted/shorter careers on
future pension entitlements
 Credit mechanisms are taken into account
 Periods out of paid employment because of
 Late entry
 Unemployment
 Parental leaves
 are explicitly considered;
 However shorter careers may also occur because
 employment patterns vary between genders
 people leave the labour market before the pension age

35. 35
MANY COUNTRIES GRANT CREDITS
FOR PERIODS SPENT OUT OF THE
LABOUR MARKET BUT THEIR
CHARACTERISTICS AND DESIGN VARY
A LOT
 For example where
 unemployment periods are insured, the benefits (full
or in part) are taken into account as pensionable
earnings
 periods of care are considered as full employment
 However there are important differences
according to
 the way pensionable earnings are taken into account
 the duration “insured”

36. 36
SHORTER/INTERRUPTED CAREERS IMPLY
PENSION REDUCTIONS…ESPECIALLY FOR
LONG BREAKS
Source: OECD (2015), Pensions at a Glance 2015, Chapter 3

37. 37
AND THERE IS LARGE CROSS COUNTRY
DIVERSITY, FOR BOTH CHILDCARE
(Future) relative gross pension entitlements of someone who has a 5-
year career-break to care for 2 children relative to a full-career worker,
%, different earnings levels
Source: OECD (2015), Pensions at a Glance 2015, Chapter 3
75%
80%
85%
90%
95%
100%
105%
Germany
Mexico
Iceland
Israel
Italy
Portugal
Chile
Netherlands
Sweden
Estonia
Austria
Korea
Finland
Denmark
Slovak…
Hungary
OECD
Switzerland
France
Poland
Norway
Belgium
Greece
Turkey
Czech…
Australia
Luxembourg
Japan
Slovenia
Canada
Ireland
NewZealand
Spain
United…
UnitedStates
Relativegrosspension
entitlement,%
1 AW 0.5 AW 2 AW
Baseline: 100%

38. 38
…. AND UNEMPLOYMENT PERIODS
(Future) relative gross pension entitlements of someone who has a 3-
year career-break for unemployment relative to a full-career worker, %,
different earnings levels
Source: OECD (2015), Pensions at a Glance 2015, Chapter 3
75%
80%
85%
90%
95%
100%
105%
110%
Chile
Turkey
Hungary
Estonia
Iceland
Mexico
Italy
Israel
Austria
Portugal
Netherlands
Japan
Poland
Finland
SlovakRepublic
Switzerland
Korea
Sweden
OECD
Belgium
Greece
Denmark
Australia
Germany
CzechRepublic
Slovenia
Canada
Ireland
NewZealand
Spain
UnitedKingdom
UnitedStates
Norway
Luxembourg
France
Relativegrosspensionentitlement,
%
1 AW 0.5 AW 2 AW
Baseline: 100%

39. CONCLUSIONS AND POLICY
IMPLICATIONS

40. 40
CONCLUSIONS AND POLICY
IMPLICATIONS
 Two important policy concerns for the adequacy
of retirement income emerge from all of the
above:
 work and care-giving competing needs
 unemployment
 The resulting shorter, interrupted careers often
mean lower retirement incomes and harm social
sustainability
 Ageing may become more unequal and equity
across generations may be jeopardised
 Pension policies can mitigate some labour
market problems softening the impact of
interrupted/shorter careers paths ex post, but
they cannot/should not fix them all

41. 41
CONCLUSIONS AND POLICY
IMPLICATIONS
 As always, prevention is better than cure and a
wide range of policies may narrow inequality and
its effect on pensions
 Bringing young people into the labour market
should be a primary concern
 Supporting life-long learning and skill development
is essential too
 But important concerns are also:
 (1) preventing parents from leaving paid
employment for too long or getting stuck in part-
time jobs; and
 (2) cutting the length of unemployment by helping
labour markets function more efficiently and
matching people, skills and jobs

42. 42
CONCLUSIONS AND POLICY
IMPLICATIONS
• Fundamental policy questions become:
 How to improve the designs of current
pension systems to make them better suited
to modern life-course realities?
 Does redistribution happen at the right stages
in the life course and do existing programmes
adequately cover risks and periods of need?
 Concrete responses may eventually
contribute to more balanced, equitable
ageing

43. 43
CONTACTS AND FURTHER
INFORMATION:
Pensions at a Glance
2015 OECD and G20
Indicators
e-mail:
ac.daddio@unesco.org
See also for life-long learning policies and education
http://uil.unesco.org/
http://en.unesco.org/gem-report/

44. From Early Exit to Active Ageing
Do Employability Policies Promote an Increase
in Social Inequalities in Later Life?
Dirk Hofäcker, University of Duisburg-Essen
Changing Labour Markets, Life Courses and Pensions
Conference at the Finnish Centre for Pensions
May 19, 2017

45. Outline
 1.Thematic Background:
Retirement Decisions in a Changing Institutional Context
 2. Institutional Shifts
 3. Institutional Changes and Retirement Behaviour
 … from a comparative perspective
 … in four selected countries
(Austria, Germany, Sweden & Estonia)
 4. Conclusions and Outlook

46. 1. Thematic Background
1970s – 1995: The long-term trend towards early retirement
0
10
20
30
40
50
60
70
80
90
100
Czech Republic
Germany
Italy
Sweden
United States
EU 21
OECD countriesEmployment rate, men, age 60-64
 Early retirement as a common response of OECD-type countries to rising
unemployment and competition on worldwide markets in the 1970s
 Acceleration of this trend throughout the following two decades
 Often accompanied by the emergence of an ‘early retirement culture’
(i.e. perception of early retirement as a ‘social right’)
Source: www.schoolsworld.tv

47. 0
10
20
30
40
50
60
70
80
90
100
Czech Republic
Germany
Italy
Sweden
United States
European Union 21
OECD countries
2. Thematic Background
1995-today: ‘active ageing’ and the trend towards late retirement
Employment rate, men, age 60-64
 Early retirement increasingly considered as being financially unsustainable
 Political measures to reverse the early retirement trend, mainly through pension
reforms, but also through investment into employability of older workers (‘active ageing’,
Jepsen et al. 2002)
 Rising employment rates among older workers since the mid-1990s
Source: www.careercast.com

48. My Questions Today
 Between-country perspective:
What are the institutional preconditions for a successful
reversal of the early exit trend?
 Within-country perspective:
How are different groups of older employees affected by active
ageing? Is there an increase in social inequalities?What role
does educational attainment play? And what could be done
about it?

49. The research project
Determinants of Retirement Decisions in Europe and the
United States:
A Cross-National Comparison of Institutional, Firm-level
and Individual Factors
Running time: 10/2012 until 7/2016
Funding: German Science Foundation
Team: Prof. Dr. Dirk Hofäcker
Dr. Stefanie König
Moritz Hess, MA
+ collaborators from 12 countries in Europe, Japan
and the US

50. The Network
Switzerland Ignacio Madero-Cabib University of Lausanne
Austria Dr. Heike Schröder Vienna University of
Economics and Busness

51. Research Questions
 Between-country perspective:
What are the institutional preconditions for a successful
reversal of the early exit trend?
 Within-country perspective:
How are different groups of older employees affected by active
ageing? Is there an increase in social inequalities? And what
could be done about it?

52. Macro Perspective
Explaining the trend towards early retirement
 Main explanations of cross-national differences through…
 1) Pull factors
Retirement regulations and financial incentives that provide
incentives to exit early from employment
 2) Push factors
‘Crowding’ out of older workers from employment due to
unfavorable economic conditions, lack of skills, high wage
costs etc.
 3) Retention factors
Maintenance of older workers in employment through continuous
updating of qualifications and skills (‘lifelong learning’) and investments
into their employability
(Kohli et al. 1991, Ebbinghaus 2006; Ebbinghaus & Hofäcker 2013)

53. Major policy trends (EEO 2012, Ebbinghaus & Hofäcker 2013):
Pull factors
+0,5
+4,0
+/-,0
+ 1,0
+ 3,0
+/-,0
+ 2,0
+/-,0
+/-,0
+/-,0
+/-,0
+/-,0
+ 1,0
- 2,0
+0,5
+4,0
+/-,0
+ 1,7
+ 4,0
+ 5,5
+ 5,0
+/-,0
- 2,0
+/-,0
+ 1,0
+/-,0
+ 1,0
+ 4,0
 General trend towards higher retirement ages, often accompanied by
closing of alternative early retirement options
 Some countries (Eastern Europe, France, Italy) still with rather low
retirement ages
Pension age
women 2010

54. Major policy trends (Ebbinghaus & Hofäcker 2013, based on
OECD 2013): Push factors
 Strong relation between rigid labour
market and early exit
 Bad health conditions particularly in
Eastern Europe

55. Major policy trends (EEO 2012, Ebbinghaus & Hofäcker 2013):
Retention factors
Share of older workers (55–75) who participated in formal and nonformal
education and training in the last four weeks in 2004, 2009, and 2014
0.0
5.0
10.0
15.0
20.0
25.0
30.0
2004
2009
2014
Source: Eurostat (2014): Labour Force Survey, no data for
Japan and United States.

56. Correlation with present employment rates (60-64)
Correspondence of actual employment with institutional background
(Index measure)
y = 0.1105x + 3.3815
R² = 0.3963
0
2
4
6
8
10
12
14
0 20 40 60 80
BE
SI
FR
HU
FI
SK
PL
HR
CZ
BG
RU
EE
GR
ES PT
UK
DE
IE
NO
CH
SE
DK
NL
Men
y = 0.1096x + 4.9699
R² = 0.3976
0
2
4
6
8
10
12
14
0 10 20 30 40 50 60
EE
RU
HR
BG
SK
PL
HU
SI
BE
GR
ES
CZ
FR
NL
DK
CH
SEN
O
PT
UK
IE
DE FI
Women
Source: OECD Labour Force Statistics, Hofäcker & Unt 2013, Hofäcker 2015
Employment rate = % of age group in active employment of 1 hour+

57. Correlation with retirement age preferences
Correspondence of future retirement expectations with institutional
background (Index measure)
Men Women
Source: European Social Survey 2010 (Wave 5), Hofäcker & Unt 2013
Question wording: ‘At what age would you like to retire?’.

58. Research Questions
 Between-country perspective:
What are the institutional preconditions for a successful
reversal of the early exit trend?
 Within-country perspective:
How are different groups of older employees affected by active
ageing? Is there an increase in social inequalities? And what
could be done about it?

59. Austria: A persistent early retirement country
Pull: Generous and flexible pension system
with still many retirement options
Push: rigid labour market, high seniority rights
of older workers, limited job opportunities
Retention: Little investments into older
workers’ employability
16.3
27.7
62.6
40.3
31.4
59.4
69.1
57.2
0
20
40
60
80
Austria Germany Sweden Estonia
Employment Rate, Men, 60-64 years
selecte countries, 2000 vs. 2014
2000 2014
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
reached ligibility for a
pension
own health or
disability
Favourable financial
arrangements to leave
Reasons for Retirement
low middle high low middle high
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
low middle high low middle high
Reasons for work beyond retirement
Financial reasons Non-financial reasons
WomenMen
WomenMen
WomenMen
WomenMen

60. Germany: An early exit reversal country
Pull: Rising retirement age, closing of early
exit routes, decreasing generosity
Push: Still rigid labour market with high
seniority protection, persistent employer
discrimination against older workers
Retention: Only modest changes in
employability policies
16.3
27.7
62.6
40.3
31.4
59.4
69.1
57.2
0
20
40
60
80
Austria Germany Sweden Estonia
Employment Rate, Men, 60-64 years
selecte countries, 2000 vs. 2014
2000 2014
0%
10%
20%
30%
40%
50%
60%
70%
80%
own health or
disability
reached ligibility for a
pension
Favourable financial
arrangements to
leave
Reasons for Retirement
low middle high low middle high
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
low middle high low middle high
Reasons for work beyond retirement
Financial reasons Non-financial reasons
WomenMen
WomenMen
WomenMen
WomenMen

61. Sweden: A persistent late retirement country
Pull: High retirement age, flexible retirement
options
Push: more flexible labour market, high re-
entry probabilities
Retention: High investments into
employability, particularly lifelong learning
16.3
27.7
62.6
40.3
31.4
59.4
69.1
57.2
0
20
40
60
80
Austria Germany Sweden Estonia
Employment Rate, Men, 60-64 years
selecte countries, 2000 vs. 2014
2000 2014
0%
10%
20%
30%
40%
50%
60%
70%
80%
reached eligibility for
a pension
own health or
disability
Favourable financial
arrangements to
leave
Reasons for Retirement
low middle high low middle high
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
low middle high low middle high
Reasons for work beyond retirement
Financial reasons Non-financial reasons
WomenMen
WomenMen
WomenMen
WomenMen

62. Estonia: A transition country
Pull: early retirement age and early exit
schemes, but low replacement rate
Push: flexible labour market, no seniority
wage system, strong health impairments
(particularly for men)
Rentention: weak lifelong learning, rather
indirect support (no pension deductions)
16.3
27.7
62.6
40.3
31.4
59.4
69.1
57.2
0
20
40
60
80
Austria Germany Sweden Estonia
Employment Rate, Men, 60-64 years
selecte countries, 2000 vs. 2014
2000 2014
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
low middle high low middle high
Reasons for work beyond retirement
Financial reasons Non-financial reasons
0%
10%
20%
30%
40%
50%
60%
70%
80%
Lost job Health/Disability Reached eliginbility
age
Reasons for Retirement
2006 2012 2006 2012
WomenMen
WomenMen
WomenMen
WomenMen

63. Conclusion
 Triggered by the prospect of active ageing, the 2000s have brought
about a policy reorientation (‘paradigm shift’) from the
previously dominant trend towards early retirement to a policy of
active ageing
 This political reorientation seems to be reflected in a general trend
towards increased employment of older people in European
countries
 Yet, there are strong cross-national differences in the degree of
the reforms and the respective employment rates of older people.
Most successful cases are those countries which have followed an
integrated approach of reducing pull/push factors while also
promoting employability (Sweden). Least successful are those
countries which have relied solely on reducing pension
generosity without fostering employability (Estonia)

64. Conclusion
 At the same time, there area also within-country
differences. Not all employees profit from the paradigm shift
from early retirement to active ageing. Especially lower-
educated or unskilled workers are faced with the dual
challenge to continue working for financial reasons despite
lacking (human capital and/or health) resources to do so.
 Again, this is particularly so in countries with a one-sided
pension reform focus and little investment into
employability. Lowest differences are observed in countries
using an integrated approach.

65. Conclusion
 Policy reforms alongside the “active ageing” agenda thus are
well-advised to rely on a simultaneous focus on pension
reforms, reductions of labour market barriers and
employability policies, particularly fostering lifelong
learning among the older population.

66. Thank you for your attention!
dirk.hofaecker@uni-due.de

67. Divided citizenship: the income of intra-EU migrants who retire
in their host country
Life-course influences on retirement
Helsinki – Finnish Centre for Pensions
19 May 2017
Traute Meyer
based on research collaboration with Paul Bridgen
supported by ESRC Centre of Population Change

68. Freedom of movement for EU citizens
National laws valid for migrant worker in host country
• employment protection
• pay
• tax
• benefits
• health service
• child benefits
• schools
• Portability of rights accrued in home & host country
(particularly relevant for pensions)
• right to vote in local & European elections
Full social & some political citizenship

69. Freedom of movement for EU citizens
Academic literature (1990s-2010s)
Successful harmonisation of social rights for migrants
Intra-EU migrants protected by European legislation
But: No research on long-term consequences of migration
especially for migrants who want to stay in host country
Economics research assumed migration is temporary
Returning migrants will be well off in home country
(Dustmann 1996; de Coulon/Wolff 2005; Kilnthäll 2006)
Evidence: first wave South-North migrants
Questionable?

70. Freedom of movement for EU citizens
Future difficult to predict – but
Migrants who stay
2015: 1 million citizens above 64 lived in host EU27 country
26% more than 2010 (Eurostat)
Reasons
Integration through employment, children, friends (de
Coulon/Wolff 2005; Edin/LaLonde/Åslund 2000; Kinthäll 2003)
Starting point of our research

71. Freedom of movement for EU citizens
Our questions
Can workers stay and become retirees? (without falling into
poverty)
Does migrants‘ social citizenship last long-term?
Our finding
In the long run migrants‘ citizenship is diminished
Quality is divided – retirement is dividing line

72. Overview
Our assumption
A significant proportion of migrants will want to retire in host
country
Can they? Does migrants‘ social citizenship last long-term?
Empirical assessment
Migrants‘ projected pension entitlements after a life-long
employment career in home/host country at different wage levels
Result
Full mobiliy of citizens enshrined in EU law is flawed in reality;
citizenship of migrants who stay put in retirement is diminished

73. Migration flows/profiles
Who migrates?
2005-2015
EU citizens from member states living in richer EU-15 increased by
52% (Eurostat)
2015
main countries of origin: Romania, Poland, Bulgaria, Italy
main destination countries Italy, Spain, Germany, UK
Profile of average migrant
age: 20s/30s
education: above average
worked at home first
de-skilling in destination country
wage catch-up can take many years
(Eurostat 2011; Alexandru 2007)

74. EU pension legislation
European legislation of pension rights accrual
• EU migrants build rights like natives
• right to transfer accrued rights and benefits
• compensation if host/home country‘s pension law
disadvantages short membership (Meyer/Bridgen/Andow
2013)

75. Our empirical approach
OECD Pensions at a Glance data 2015
• hypothetical individuals
• start work in 2015 – retirement in 2050s
• life-long employment on half & on average wages
• all mandatory public/occupational schemes
• pension entitlements expressed as share of last wage
• evaluation of current rules – not a prediction

76. Our empirical approach
Hypothetical migrants

77. Pension replacement rates
and wages
• Replacement rates
origin/destination similarly
diverse
• Wages in destination
countries much higher than
in countries of origin (Bulg
13% of Ger) Italy: rigid
labour market
• Even high replacement in
home country will matter
little for overall result in
host country
• Does pension system in
host country compensate?

78. Does host country compensate?
• Large differences in pension
system generosity (Spain/Italy
top)
• Native worker on aver wages
better off than migrants 1 & 3
because rights accrued at home
hardly matter (exception Italy)
Poverty risks (can they stay?)
• No poverty risk for most migrants
to South
• Poverty risk for most migrants to
North
• Period of low wages in host
country (bio 2,4) & delay of
migration (3,4) is risky for all, but
most for migrants to Germany,
UK.
Poverty line: 60% of gross median wages

79. Divided citizenship
During employment
Social citizenship of EU migrants comparable to natives in the
same job
Retirement in host country
Migrants‘ citizenship diminished in comparison
Migrant workers doing same work as natives throughout their
lives lose out because of wealth differentials between political
economies
Integration achieved during employment at risk in retirement
Returning migrants materially wealthy but at “home“?
A migration dilemma

80. Divided citizenship – Remedies?
Collective/ public policy variants
EU wide minimum pension based on national wealth: proportion
of average wages at social assistance level
Upgrade of rights accrued in home country in relation to host
country wage
Individualised variant
Strong savings incentives for migrants to counterbalance drop in
citizenship through retirement
All three equally utopian...

81. Changing Labour
Markets, Life-course
and Pensions
Answering to challenges from good
basis
19.5.2017
Katja Veirto, Akava

82.  Rules of pensionsystem in Finland are same for all
labour mobility less unemployment
 High-coverage of earnings-related pensions
 Compulsary, also for enterpreneaurs
 reduces old-age poverty and creates stability
 Continuity and recognising changes in working-life
 tripartite decision making
Challenges but good basis

83. Many things in working-
life are also better than
ever

84.  Tools in pension legislation are already used
 Retirement age is rising and no early-exit pensions
 Sosio-economical differencies in working careers
 Importance of life-long learning
 Health and safety can’t be neglected
• Fertility-rate 1,57!
• Focus on familypolicy and working life
Challenges to be answered

85. CHANGING LABOUR MARKETS AND
OLD-AGE SECURITY: COMMENT FROM
A FINNISH VIEWPOINT
Jaakko Kiander
PhD, senior vice president
Ilmarinen Mutual Pension Insurance Company

86. LABOUR MARKET CHANGES IN
FINLAND
• History of large cyclical changes
– Deep recessions in 1990s and 2010s
– High unemployment 1990-2005
• Ageing population as a long term trend
– Period of rapid aging 2010-2030 and increasing old-age
dependency ratio
• Structural change will continue
– Regional change and urbanization continues
– Deindustrilization and new types of work
– Immigration and increasing heterogeneity
• Unemployment and pensions
– Pension accrual during unemployment spells

87. OLD-AGE SECURITY AND FINNISH
PENSION SYSTEM
• A succesful hybrid system with high coverage
– Universal national pension system covering almost everybody
(including self-employed)
– Occupational pension as a primary benefit
– Provided as a private insurance product
• Basic pension as a supplement
– Flat-rate and means-tested basic state pension paid to those without
sufficient occupational pensions
• Earnings-related occupational pensions based on earnings-
history, not on nationality or residence
• Defined benefit and defined ambition: no individual risk
• As a result, relatively equal income distribution, low poverty
rate, not much need for additional individual savings

88. FLEXIBLE SYSTEM IN A CHANGING
WORLD
• Partly funded system with almost defined benefits has so far
been flexible enough:
– In spite of large economic fluctuations the pension system has been
stable
– Relatively large pension funds
• Occupational system has been resilient; perhaps because it
is not a state system but a mutual insurance system
managed by social partners – better political protections
than basic benefits
– Necessary adjustments negotiated by social partners and accepted
by the parliament
– Major reforms in 2005 and 2017: rising retirement age with increased
individual choice
• It is hoped that the stability (and flexibility) can be
maintained also in the future
– How the relations of social partners will evolve in the long term
(the future of the old model of social corporatism)

89. FUTURE CHALLENGES
• Demographic change
– Migration, fertility, longevity
• Economic growth
– Labour productivity, employment rate
• Investment returns in the time of new normal
– Long term sustainability based on sufficiently high expected
returns
• Systems competition
– Should there be a larger role for individual savings?

90. Anna d’Addio
Dirk Hofäcker
Traute Meyer
Katja Veirto
Jaakko Kiander

91. Second session:
Pension and Retirement from a Life-course Perspective
12.30-14.30
Presentations:
Kathrin Komp (University of Helsinki)
Joakim Palme (University of Uppsala)
Comments:
Noora Järnefelt (Finnish Centre for Pensions)
Roope Uusitalo (University of Jyväskylä)
14.30 Closing words
Susan Kuivalainen (Finnish Centre for Pensions)
Kati Kuitto FINNISH CENTRE FOR PENSIONS

92. www.helsinki.fi
Life-course influences
on retirement:
Effects at the individual-, family- and country-level
Kathrin Komp

93. www.helsinki.fi
Main message
Our lives follow their own dynamics. As a
result, already experiences at an early age
influence the retirement age. As a result,
pension reforms that aim to change
people’s behaviour from one day to the
next cannot succeed. Likewise, historical
events can change our lives for good.
Consequently, the results of the 2008
economic crisis will still affect the
retirement age for decades to come.

94. www.helsinki.fi
What is the life-course?
Life-course = everything that happens in a person’s
live from the cradle to the grave
Important:
• periods that remain the same: life-phases
• changes/turning points: life events

95. www.helsinki.fi
What are life-course influences?
1) Influences within the life-course: events have
mid- or long-term effects, develop their own
dynamics, e.g. scarring effects of
unemployment
2) Influences of institutions on the life-course:
institutions give the life-course a specific shape,
affect at what age we do what, e.g. statutory
retirement age

96. www.helsinki.fi
Dynamics within life-courses
Idea: an event triggers follow-up events, which
eventually influence retirement
Where this happens:
• Accummulation of pension benefits during working
career: influence amount of pensions & timing of
retirement
• Unemployment spells that lead to further un-/non-
employment, bring about or prevent early retirement

97. www.helsinki.fi
Dynamics within life-courses
Youths & the 2008 economic crisis
• Unemployment rates among youths particularly
high during the crisis, especially in Southern
Europe and Ireland
• A new ”lost generation” is forming
• Cumulative disadvantages throughout the life-
course: most likely more unemployment and
non-employment spells later on, less pension
rights accumulated
• Already now foreseeable: in ca 30 years there
will be an increase in un- and non-employed
older people who retire late and receive low
pensions

98. www.helsinki.fi
Dynamics within life-courses
Older workers & the 2008 economic crisis
• Less affected by increasing unemployment rates
• But: once they lost their jobs, they are less likely
to find new employment
• Previous life-course decides on reaction: retire
early, if enough pension rights and savings
accumulated; otherwise retire late
• Critical: happens in times of population ageing,
where late retirement is encouraged
=> how much additional pressure can pension
schemes take at the moment?

99. www.helsinki.fi
Dynamics within life-courses
The 2008 economic crisis: young vs. old
Youths Older workers
Crisis creates
dynamic
Dynamic Dynamic shapes
reaction to crisis
Long Time-span
of effect
Short
Severe Effect Less severe
Various
possibilties
Political
intervention
Fewer possibilites
⇒ Which age group should be primary target for employment policies?
⇒ When do we want the effect of pension schemes?

100. www.helsinki.fi
Dynamics within life-courses
Secondary effects of the 2008 crisis
• Linked lives: crisis experiences passed on to
family members
• Work migration of unemployed youths:
family migration or more distance between
family members
• Delayed family formation:
economic security comes first (sometimes …)
=> can increase the speed of population ageing
=> double pressure on countries affected by the
crisis

101. www.helsinki.fi
Institutions shape life-courses
Idea: institutions and regulations shape life-courses and
retirement with them
Where this happens:
• Pension regulations: statutory pension age, early
retirement options, replacement rate

102. www.helsinki.fi
Institutions shape life-courses
Pension reforms & life-course lag
Riley, Kahn & Fohner (1994): Structural lag = it takes a
while until social structures adapt to changing lives
BUT: Pension reforms create the inverse situation:
life-courses have to adapt to changing social structures
= life-course lag

103. www.helsinki.fi
Institutions shape life-courses
Pension reforms vs. the life-course
Pension reforms demand change in an area that is affected by
the entire life-course
Examples: educational level, life-long learning, savings,
expectations, health behaviour, coordination within families
⇒ Rapid change of retirement behaviour possible, rapid
reform-aligned increase of realized retirement age not
⇒ Earlier intervention necessary
But what pension reforms can do is …
• Change the perception of when old age starts
• Change the characteristics associated with old age
• Change the situation in old age

104. www.helsinki.fi
Institutions shape life-courses
Time-lags in pension reforms
(Komp, 2014)

105. www.helsinki.fi
Conclusions
• Retirement influenced by many factors: pension regulations,
historical events, family, life-course, …
• Pension reforms alone cannot increase the retirement age
according to reform plan
• Other options:
(a) accept that 100% success impossible
(b) combine reforms in different areas, e.g. pensions and
health care
(c) intervene at an earlier age
• Careful: labour market and pension policies shift effects of
2008 crisis between generations and over time
=> which generation can best shoulder this problem & when
can pension schemes take another shock?

106. Retirement and inequality
Joakim Palme

107. The Talk
• Old and new social questions
• Pension reform, retirement and inequality
- paradoxes and dilemmas
Realities:
• Inequality among the elderly – income,
mortality health
• Life expectancy among the elderly
• Income inequality and health among the
pre-retirement elderly

108. Pensions in 18 OECD
countries
1930-2010

109. Key dimension of pension systems
• Basic security is degree to which public pension
entitlements correspond to an adequate minimum
income standard
• Income security is the degree to which benefits replace
earnings during earlier working life.
• Over the postwar period, countries have attempted to
meet both of these goals. The relative emphasis given to
basic security and income security has varied, as have
the strategies and means used to reach them.
• Pension expenditure relates pensions expenditures to
the size of the GDP. Weighted expenditure standardizes
this indicator by the relative size of the population above
65 years of age.

110. 0
0.2
0.4
0.6
0.8
1
1.2
1930 1933 1939 1947 1959 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Pension system coverage and take-up
coverage take-up

111. 0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
1930 1933 1939 1947 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Pension benefit levels: worker’s minimum and full pension
1930-2010
minimum pension full worker pension

112. Three dimensions of inequality
• Firstly; the average income level of the elderly population
vs. the non-elderly population - the generation-gap. The
larger the value the larger the distance between the two
groups.
• Secondly, the overall income inequality in the elderly
population. The traditional inequality is here used to
describe the overall degree of inequality.
• Thirdly, the situation of the worst-off, what usually is
referred to as poverty, is based on poverty lines in
relation to the income levels of the whole population.

113. Hypotheses
• The ‘size’ hypothesis holds that the larger the size of public pension
expenditures, the less inequality
• The ‘skeptical’ hypothesis, predicts the opposite relationship: the
higher the level of public pension expenditures, the more inequality
will we find among the elderly.
• The approach outlined above with a focus on institutions generates
two hypotheses. The first, which we can call the ‘basic security’
hypothesis, predicts that relatively higher basic security entitlements
tend to decrease inequality among the elderly.
• The institutional approach also focuses interest on earnings-related
benefits, which can be addressed by the ‘income security’
hypothesis, predicting that a relatively higher degree of income
security tends to decrease inequality among the elderly due to the
‘crowding-out’ of private pensions.
• Positive correlation between basic and incomes security

114. Results of regression analysis
Generation
gap
Poverty Inequality
Spending +
Basic
security
+ +
Income
Security
+

115. The Paradox
The more we target benefits at the poor only
and the more concerned we are with
creating equality via equal public transfers to
all, the less likely we are to reduce poverty
and inequality.
Universalism and basic security
Income security and crowding out

116. Index of Targeting Public Pensions and inequality in Gross
Income (Gini) Among the Elderly in Nine Countries
-0,10
-0,05
0,00
0,05
0,10
0,15
0,20
0,25
0,30
0,35
0,40
FIN SWE GER NOR USA NET UK CAN AUS
Public Pensions Gross Income

117. Retirement and health

118. Public pension institutions and
old-age mortality in
comparative perspective
Norström, Thor and Palme, Joakim
IJSW 2010

119. • To what extent is the type of pension regime
and generosity of pension benefits important for
old-age mortality?
• Data on pension rights from Social Citizenship
Indicator Program (SCIP) and on all-cause
mortality from WHO Mortality Data Base and
Human Mortality Database
• Applied pooled cross-sectional time-series
analyses, combines cross-sectional and time-
series data
• Old-age excess mortality = mortality 64+ / mortality
30-59

121. • In short;
– that the design of pension rights can make a
difference for old-age excess mortality
– more generous basic security pension was
related to a lower excess mortality among the
old whereas the generosity in income security
pension did not prove to have a beneficial
effect.

122. Do public pensions matter for health
and wellbeing among retired persons?
Basic and income security pensions
across 13 Western European countries
Ingrid Esser and Joakim Palme IJSW 2010

123. Why the welfare state should matter?
1) Provide resources for goods and activities that improve health
and well-being.
2) Redistributive role, i.e. reducing income differences in society
between different social groups
Contextual level
1) The Welfare state – basic and income security
Esser and Palme/ pre-retirement
age health across Europe
33

124. Dependent variables: well-being and health
Esser and Palme/ pre-retirement
age health across Europe
34
Self-rated ill-health (scale 1-5)
How is your health in general?
[very good/ good/ fair/ bad/ very bad]
Well-being (WHO-3 index, scale 0-15)
1) I have felt cheerful and in good spirits
2) I have felt calm and relaxed
3) I have felt active and vigorous
4) I have woken up feeling fresh and rested
5) My daily life has been filled with things that interest me

125. Why?
1) Culturally biased, i.e. country specific
2) Heterogeneity among countries at the general level of population’s health
may distort outcome.
Especially older workers’ health will be related to how it has been shaped
during the entire life course within a country-specific context.
Calculated as: Health/wellbeing of the persons aged 65+
Average health/wellbeing of persons aged 25–64
(by country and gender).
Dependent variables: relative measures
Esser and Palme/ pre-retirement
age health across Europe
35

126. RESULT:
Basic security matters

127. How pension system design
matters
Distribution of benefits and
political economy

128. The ageing crisis
and its shadow over the future

129. Rethinking social policy in ageing societies
• Social security is strongly redistributive over the
life cycle: the ageing of societies puts tough
fiscal pressures on public spending
• The debate on ageing issues has been overly
focussed on pension reforms and savings
• How social policy interact with fertility, education
and labour supply is of vital concern: secure the
future tax base!

130. Education and Growth:
Macro model
Statistically significant relations
– Education expenses have a positive impact
on GDP/capita
– GDP/capita has a positive impact on average
years of education but a negative impact on
the GDP share of education expenses
Fertility, female labour supply and policy
reforms

131. Dilemmas of pension reform

132. Issues in pension reform work
• Qualification periods: prolongation,
DB>DC
• Universalism vs targeting
• Pre-funding
• Life expectancy adjustments

133. 0
5
10
15
20
25
30
35
40
1930 1933 1939 1947 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Contribution period 18 OECD countries 1930/2010
contribution period

134. Early retirement spending %
18 OECD countries
1980s 1990s 2000 2009 2015
0.30 0.25 0.15 0.12 0.08

135. 0
-4
-2
-5
-6
-8
-4
4
3
1 1
0 0
1
-10
-8
-6
-4
-2
0
2
4
6
2004 2006 2008 2010 2012 2014 2016
Alterations of contribution periods for full pensions, EU
expansions pension contribution period
retrenchments pension contribution period

136. -12
-8
-9 -9 -9
-11
-12
4
1 1
2
-14
-12
-10
-8
-6
-4
-2
0
2
4
6
2004 2006 2008 2010 2012 2014 2016
Alterations of retirement age, EU
expansions pension minimum age
retrenchments pension minimum age

137. Life expectancy

138. Figure 1
Survivalcurve for men and women
who have reached 60 years of age
Reached age
Share of survivors (%)
60 65 70 75 80 85
0
20
40
60
80
100
Median
Women
Men

139. Figure 2
Survivalcurve for men who have reached 60 years of age,
by socio-economic group
Reached age
Share of survivors (%)
60 65 70 75 80 85
0
20
40
60
80
100
Median
Not employed
White-collar
Blue-collar

140. Pre-retirement elderly
Health

141. Class distinctions of work related ill-health by age
among 55 to 69-year-olds in 1991 (main and interaction
effects) N=900.
Class 55-59 60-64 65-69
Intermediate
and high
white-collar
workers
0,45 0,71 0,86
Low white-
collar workers 1,01 1,26 0,57
Skilled blue-
collar workers 1,57 1,10 1,14
Unskilled
blue-collar
workers
1,88 1,32 1,02

142. Gender distinctions of work related illness, and ache in
back, shoulders, hips and joints by age among 55 to
69-year-olds in 1991 (main and interaction effects)
N=900.
55-59 60-64 65-69
Work related
illness:
Men
1,06 0,91 0,59
Women 1,10 1,24 1,27
Ache:
Men 1,42 0,78 0,56
Women 1,17 1,21 1,12

143. Pre-Retirement Aged Persons’ Health across Europe:
Individual Characteristics, Job Context and Institutions of Social
Protection
in a Multi-Level Framework
Ingrid Esser
Swedish Institute for Social Research (SOFI), Stockholm University
Joakim Palme
Department of Government, Uppsala University

144. Purpose
Examine the importance of social protection across Europe
for self-rated health of pre-retirement aged persons 50-64
years old, while also accounting for important individual and
job-related factors.
Esser and Palme/ pre-retirement
age health across Europe
54

145. Contextual level(s)
1) The Welfare state - social protection
2) Unemployment
3) Level of economic development
4) Legislated standard age for retirement
5) Labour market conditions
Esser and Palme/ pre-retirement
age health across Europe
55

146. Why the welfare state should matter?
1) Provide resources for goods and activities that improve health
and well-being.
2) Redistributive role, i.e. reducing income differences in society
between different social groups (Norström and Palme 2010)
3) Reduce stress also of working and healthy persons of risking
economic insecurity when unable to provide for oneself (Sjöberg
2010)
Esser and Palme/ pre-retirement
age health across Europe
56

147. Individual survey data
European Social Surveys (ESS), five rounds 2002-2010 collapsed
 Over-time evaluation: self-rated health and well-being of agegroup
50-64 does not on average change over time, pre- and post-crisis
health compared,
 slight decline in men’s self-rated health (from 3.67 to 3.63).
Countries (n=24)
Northern EU: DK, FI, NO, SE
Western EU: AT, BE, CH, DE, FR, NL
Anglo-Saxon EU: IE, UK
Southern EU: CY, ES, GR, IT, PT
Central/East EU: BL, CZ, EE, HU, PL, SL, SK
Method: Multi-level analysis
Esser and Palme/ pre-retirement
age health across Europe
57

148. Conclusions
58
1. GDP positively related to health, all 24 countries compared
 real effect of GDP or legacy from past authoritarian regimes
2. Unemployment, tends to be negatively related to health
 multi-collinearity with GDP
3. Social protection
- small effects
- not very consistent across sub-samples:
mainly for sick/disabled + some spill-over on working persons
- results sensitive to exclusion of influential cases
4. Job context and measures of job quality important for health (and
well-being), here interpreted as an expression of production
regime/labour market regimes
5. Individual effects; largely as hypothesised with gendered differences

149. Conclusions continued
Esser and Palme/ pre-retirement
age health across Europe
59
 “dilemma of desired prolongation of the working life
may come into conflict with social objectives in
terms of avoiding punishing vulnerable groups
among the pre-retirement elderly, notably workers
in physically demanding jobs and women (with
generally poorer health status) who in reality cannot
choose to continue to work”.

150. Income hierarchies among
preretirement elderly
Categories A
• Earnings
• Retirement income
• Social insurance
• Social assistance
Comparative analysis:
Basic and security
matter again!
Categories B
• Employed
• Working pensioner
• Retired
• Exited

151. Policy learning is possible only if we
move beyond the concept of a model,
or regime, and instead apply an
institutional program specific
approach and look for institutional
complementarities

152. EU Commission: Old-age expenditures, replacement
ratios and outcomes in Southern Europe

153. Towards a social investment
welfare state?
Crowding out of benefits and
services…
• Social investment and social
protection
• Activation and social insurance
Gender perspective:
- And social services!

154. The Generational Welfare
Contract

157. Is retirement unequal?
A comment
Noora Järnefelt

158. 6822.5.2017Noora Järnefelt FINNISH CENTRE FOR PENSIONS
Attempts to increase statutory old-age pension age
perceived unfair by blue-collar employees

159. Expected number of years in old-age
retirement for 50 yrs old (in 2007)
6922.5.2017Noora Järnefelt FINNISH CENTRE FOR PENSIONS
15.4
17.7
16.3
13.2
0
5
10
15
20
25
Men
19.4
22.4
20.8
18.9
0
5
10
15
20
25
Women
Source: Myrskylä & Leinonen & Martikainen 2013, ETK Working Papers

160. In earnings-related pension
systems old-age pension is
regressive
Noora Järnefelt FINNISH CENTRE FOR PENSIONS 22.5.2017

161. More years in early retirement (disability) if
you are a blue-collar worker
7122.5.2017Noora Järnefelt FINNISH CENTRE FOR PENSIONS
15
18
16
13
3 2 3 4
0
5
10
15
20
25
Men
Old-age retirement expectancy
Early-retirement expectancy
Source: Myrskylä & Leinonen & Martikainen 2013, ETK Working Papers
19
22
21
19
4 1 3 4
0
5
10
15
20
25
Women
Old-age retirement expectancy
Early-retirement expectancy

162. Disability pension is an important balancing
element in the Finnish pension system
7222.5.2017Noora Järnefelt FINNISH CENTRE FOR PENSIONS
0
5
10
15
20
25
Men
Old-age retirement expectancy
Early-retirement expectancy
19 18
17
0
5
10
15
20
25
Women
Old-age retirement expectancy
Early-retirement expectancy
23 23 23
18
23
Source: Myrskylä & Leinonen & Martikainen 2013, ETK Working Papers

163. 7322.5.2017Noora järnefelt FINNISH CENTRE FOR PENSIONS
Self-
employ
ed
Upper
n-m
Lower
n-m
Manual
worker
s
All pension
years/ Work
years
48 52 53 50
Old-age
pension years/
Work years
41 48 46 38
0
10
20
30
40
50
60
70
80
%
Men
Self-
employ
ed
Upper
n-m
Lower
n-m
Manual
worker
s
All pension
years/ Work
years
67 67 66 75
Old-age
pension years/
Work years
56 63 59 62
0
10
20
30
40
50
60
70
80
%
Women
Division of work and retirement over the life course

164. Internationally emerging tendency to
segregate between disability and pension
benefit systems:
• Disability benefits (pensions) removed from the
pension system
• Differentiation of formulas to calculate disability
and pension benefits
• Making disability benefit/pension a transitory
payment
• E.g. in Sweden, Norway, the Netherlands, France
7422.5.2017Noora Järnefelt FINNISH CENTRE FOR PENSIONS

165. CONCLUSION:
Excluding disability pension
may aggravate the
experienced social inequality
of a pension system
7522.5.2017Noora Järnefelt FINNISH CENTRE FOR PENSIONS

166. Labor markets are changing,
really?
Roope Uusitalo
University of Jyväskylä

167. True, labor market is changing
• ICT revolution
• Globalization
• Population ageing
• Increasing education & improving skills
• Success of women
• Declining importance of unions

168. … but the jobs are not
• Temporary work
• Length of employment spells
• Number of jobs during the careers
• Average length of employment spells
• Job satisfaction
All PRETTY MUCH UNCHANGED

172. Lähde: Rokkanen & Uusitalo ,T&Y 1/2010

173. Lähde: Rokkanen & Uusitalo ,T&Y 1/2010

176. Kathrin Komp
Joakim Palme
Noora Järnefelt
Roope Uusitalo

177. Thank you