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West Europe - Economic Status

age job social differences pension poverty people countries

In industrial countries worldwide the financial position of unemployed older people depends on three factors: a basic pension and other social security income provided by the state; a supplementary occupational pension; and personal savings. The economic status of elderly people is the outcome of an interaction between the economic status they achieved during their working lives and the particular pension systems they depend on during retirement. Initially, most pension systems were based on the implicit model of the male head of the family, as a wage earner who would be working for forty or fifty years in the same job until retirement, thereafter enjoying old age with the same wife he married when he was young. As a result of this, people who deviate from this implicit cultural pattern often encounter severe problems. Such problems may arise for men who have changed employers and unknowingly built up only a fragmented pension, but typically the negative effects of the pension system fall on women, who traditionally engaged in activities of the domestic sphere, such as raising and educating children. Women often work in paid jobs for a relatively small part of their lives or have only part-time jobs. Consequently, many older women have not built a sufficient pension. Paradoxically, a system that was constructed to prevent poverty in old age has produced specific categories of poor older people. This gender-based inequality is widespread in western Europe. According to the Eurobarometer Survey only the Scandinavian countries, especially Denmark, have successfully evaded this feminization of poverty in old age through universal flat-rate pensions that are regarded as a right of citizenship regardless of one’s employment record.

The European Observatory on Ageing and Older People has indicated that there are four main trends in the living standards and pension policies of European Union (EU) countries (see Walker and Maltby):

  1. Living standards of older people have generally been rising in recent years.
  2. There are wide variations between the different countries of the EU concerning the level of protection that pension schemes provide to retired people.
  3. Within the older population, the gap in living standards is widening between recently retired, predominantly male members of higher social classes, with a long record of secure employment, on the one hand, and a considerably (at least five times) larger group, many of whom are likely to be women and older than the affluent group, on the other hand. There is an extreme polarization in pensioners’ living standards, especially in the United Kingdom.
  4. There is a continuing problem of poverty among older people, with considerable differences between the relative sizes of these minorities compared to the total population.

Although a clear definition of poverty is difficult and relevant statistics on poverty and the aged are limited, the European Observatory has distinguished three groups of countries in the EU with low, median, and high poverty rates among their elderly population. Countries with low poverty rates (less than 10 percent) include Denmark, Germany (the former Federal Republic of Germany), Ireland, and Luxembourg. Median poverty rates (10–29 percent) were measured in Belgium, France, the northern part of Italy, and the Netherlands. High poverty rates (30 percent and more) were measured in Greece, Portugal, Spain, southern Italy, and the UK.

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