December 2024
11Dec

Rising Pension Poverty in Germany: A Growing Number Below Minimum Living Standards

The issue of pension poverty is increasingly prevalent in Germany, with a significant portion of the elderly population receiving pensions that fall below the established minimum living standard. Recent statistics reveal that the situation is worsening, as more seniors struggle to meet their basic needs. As of the end of 2023, the minimum living standard for pensioners, as defined by the basic security benefits in old age, was set at 942 euros per month. Approximately 7.9 million individuals in Germany...

December 11, 2024
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03Dec

Thousands of Volkswagen workers strike at factories across Germany

Thousands of Volkswagen workers in Germany went on strike on Monday after the company announced plans to close three plants and slash pensions. Tens of thousands of employees with the IG Metall union stopped work at 9:30 a.m. The strike is set to last two hours, a process which will be repeated by the late shift. Nine of Volkswagen’s car and component factories in Germany were affected by the so-called warning strikes, with work either being halted temporarily for demonstrations or shifts...

December 3, 2024
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August 2024
20Aug

German CDU party marks retirement age as priority in pension policy plan

The German Christian Democratic Union (CDU) party has placed increasing retirement age on top of its list of priorities for its pension policy programme, if it wins the general election next year. “Adjusting the retirement age to life expectancy must be [included] both in the government programme and in the party’s manifesto (Grundsatzprogramm),” said Gitta Connemann, chair of the Mittelstands und Wirtschaftsunion (MIT), the pro-business political association of the CDU and its ally Christian Social Union (CSU), in an interview with the Frankfurter...

August 20, 2024
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01Aug

Funding ratios of German corporate schemes hit unprecedented level

The funding ratios of pension schemes of German companies listed on the DAX and MDAX indices have climbed to an unprecedented level in the first half of this year, according to the latest Pension Finance Watch published by WTW. The funding ratio of pension plans of the largest firms listed on the DAX index improved to 84% in H1 2024, up from 79.1% at the end of 2023, WTW’s figures show. The funding ratio of pension plans of companies listed on...

August 1, 2024
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July 2024
31Jul

When Institutions Interact: How the Effects of Unemployment Insurance are Shaped by Retirement Policies

By Matthew Gudgeon, Pablo Guzman, Johannes F. Schmieder, Simon Trenkle & Han Ye This paper shows empirically that the non-employment effects of unemployment insurance (UI) for older workers depend in a first-order way on the structure of retirement policies. Using German data, we first present reduced-form evidence of these interactions, documenting large bunching in UI inflows at the age that allows workers to claim their pension following UI expiration. We then estimate a dynamic life-cycle model and use it to...

July 31, 2024
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29Jul

Elderly Germans Face Rising Poverty Threat

Germany is facing a growing concern over the rising number of elderly citizens living in poverty. Recent investigative reports indicate that a staggering 3.2 million pensioners in the country are at risk of economic hardship, a situation worsened by stagnant wages and insufficient pension benefits. As mentioned in reports from the public broadcaster ARD, nearly one in five, or approximately 18.7%, of Germany's pensioners were classified as being at risk of poverty as of 2017. This alarming statistic highlights...

July 29, 2024
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June 2024
24Jun

German Allianz to invest in China’s mega pension company with 2% stake

 Allianz Global Investors (AGI), one of the investment arms of German insurer Allianz, has become the first foreign company to own a stake in China's pension insurance giant Guomin Pension. AGI was allowed to subscribe to newly issued shares representing 2% in the company, and the stake is worth 228 million yuan ($31.40 million), the pension firm said in a statement issued Monday. Guomin Pension, jointly launched by China's largest banks and insurers, was established in 2022 to promote the development...

June 24, 2024
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May 2024
31May

Live Longer and Healthier: Impact of Pension Income for Low-Income Retirees

By Chiara Malavasi & Han Ye We estimate the effect of additional pension income on mortality outcomes by exploring the eli- gibility criteria of a German program subsidizing the pensions of low-wage workers. Using novel administrative data, we find that eligibility leads to a 2-month delay in age at death (censored at 75). Survey evidence suggests that additional pension income improves both mental and physical health. In addition, individuals feel less financially constrained and are more optimistic about their future....

May 31, 2024
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29May

Germany poised for stagnation with ageing population, warns IMF

The eurozone’s largest economy is heading for stagnation amid a period of rapid population ageing that will place intense strain on the state and public finances, the International Monetary Fund has warned. In a snapshot of the German economy, the fund said economic growth would slow markedly due to the generation of baby boomers born between 1946 and 1964retiring and the recent waves of immigration, which have hitherto replenished the labour force, subsiding. The Washington-based organisation, which has 190 member countries,...

May 29, 2024
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April 2024
29Apr

Germany to hike pensions nationwide by 4.57%

The more than 21 million pensioners in Germany would receive a substantial 4.57 percent pension increase beginning on July 1, after the German Cabinet approved the adjustment in Berlin. With this increase, pensions are set to rise faster than inflation in the country. The last time pensions rose faster than inflation was in 2000. The increase is larger than originally predicted, which the Labour Minister Hubertus Heil, credited to strong wage growth in Germany. In the autumn, estimates had predicted an increase of...

April 29, 2024
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