Germany's pension system will soon fail to serve the people who will need retirement assistance most, according to a new study. Women, part-timers and people left unemployed for long stretches are most threatened.
Seniors in Germany could face more widespread poverty within a generation, according to a new study by the neoliberal Bertelsmann foundation. The people left most vulnerable under the current conditions include single women, the long-term unemployed and workers who have been classified as "underqualified."
"Permanent jobs and years spent in the same place of work - this labor model is taken for granted by many people," according to the study, which was undertaken by the German Institute for Economic Research and the Centre for European Economic Research and published Monday. The realities for many workers nowadays are "minijobs, long phases of unemployment and low wages."
According to the study, by 2036 the risk factors leading to widespread old-age poverty will have increased significantly, hitting up to 20 percent of Germany's retired population - well above the 16 percent of seniors already affected in 2015. People with a current monthly net income of 958 euros ($1,070) or less are especially at risk.
"Discussions of a stabilization of pension levels do not help risk groups who already could scarcely live from their incomes," said Christof Schiller a labor market specialist at Bertelsmann.
'A rude awakening'
Seven percent of retirees will require public assistance by 2036, the study predicts, up from 5.4 percent in 2015. The share of retired women who receive assistance could rise from 16 percent to 28 percent in the same stretch. The number could grow from 19 percent to 22 percent for people who are left long-term unemployed and from 10 percent to 14 percent for those who have not received career training, and from 5 percent to 11 percent for residents of states that once belonged to the former East Germany.
"When the baby-boom generation goes into retirement, we could see a rude awakening," said Aart De Geus, the chairman of Bertelsmann's board. Germany's baby boomers are defined as having been born between 1955 and 1969 and could begin retiring en masse in 2022.
The study credited demographic development with creating deteriorating labor conditions such as precarious or temporary employment in Germany's low-wage sector. Falling interest rates have also hit privately administered retirement plans that have been made reliant on credit and markets.
mkg/msh (AFP, KNA, epd, dpa)