Committee on Employment and Social Affairs Ordinary meeting
23 June 2026
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EMPL European Parliament
Follow its sittings05:21 - 07:02
Speaker 2
All right, it is 2:35, so we are ready to start our hearing on promoting solidarity within and between generations through decent pensions. As we know, Europe's demographic landscape is undergoing profound change. In all member states, the population is rapidly aging, while longer life expectancy and lower fertility rates are putting increasing pressure on pension systems across the Union. At the same time, changes in the labor market, such as youth unemployment, more fragmented careers, increasing adoption of platform work, persistent gender inequalities, etc., could also negatively affect adequacy and sustainability of future pensions. Therefore, it is important to discuss these issues, and that is why the EMPL Committee is holding this hearing today.
We have two panels with two experts in each. Presentations of the experts will be followed by Q&A sessions with committee members, and we have about 40 minutes per panel. We'll start with the panel number one dedicated to examining how aging societies and changing work markets and patterns are affecting pension adequacy across the European Union. And our first speaker today is joining us remotely. He is Professor Dr. Bernhard Ebbinghaus, Professor of Sociology at the University of Mannheim.
So Professor Ebbinghaus, the floor is yours for the next eight minutes.
07:02 - 13:55
Speaker 1
Yeah, thank you, Madam Chair, for the opportunity to speak at this hearing about my own research on pensions and its reform implications. The first panel session today brings three topics in focus: demographic change, labor market transformation, and the future of pension solidarity.
For decades, we are aware of the demographic challenges that were just noted also by the chair. And these challenges are seen often as challenges to financial sustainability of pensions. Aging societies have longer life expectancies, therefore longer times of retirement, but there are ever more pensioners per fewer working people. That puts particular pressure on the financing of pensions. This old-age dependency is a challenge for public pay-as-you-go pensions, maybe somewhat less so for funded pensions.
The second important aspect is, I think, for today's discussion is the labour ongoing labour market transformation, which provides a further challenge to retirement income provision in the future. Flexibilization of work ranges really from part-time to non-stable, low-paid or precarious jobs. And these tend to be less covered by contributory pension systems. Pension reforms seek to extend working life and reverse early retirement, but there's also the aspect of disability increases with age and therefore we do need to have special provision for those that cannot work as long. The EU also seeks to increase employment overall and to reconcile work and family, allowing higher employment participation of women and that will certainly also help for their pensions.
Nevertheless, these flexibilizations of work trends may lead to old-age poverty risks in contributory pensions, particularly for those in work groups affected by flexibilization in the future. Therefore, these pension reforms that we are discussing today speak to a kind of a trade-off between sustainability on the one hand and adequate and fair pensions on the other hand. However, reforms are really difficult due to political pressure that's been part of my research on public opinion and also the role of organized interest that have an interest more in the status quo than in very far-reaching reform steps. Therefore, generally given those challenges, we have to think about the consequences of these challenges for pension reforms, but we need also to think about whether we are reproducing some of the labour market inequalities in old age. On the next slide, you see one of these megatrends, that is the increase of higher employment.
The EU had set some targets in 2010, 2020, and older workers' employment has increased, but there are some countries that really struggle more and are falling behind these kind of achievements, particularly given also the repeated economic crises. The next slide will show us another empirical finding, that is basically today's exit age on the one hand for men and women, and on the other hand the life expectancy at 65, so the duration then after the exit age in terms of their retirement. And you can see here certainly major differences across EU member states in average retirement age and the remaining life expectancies.
This leads to varying lengths of retirement and these are hardly in line with exit ages across these countries. So we find some that have later retirement, some earlier retirement, but it may be not quite in sync with the life expectancies. In Europe, men exit from work on average around 64 with a retirement duration of 19 years, while women tend to retire earlier and draw pensions for four years longer. The next slide provides us a further classification by the OECD of these different types of flexibilization of work forms, from part-time work to temporary contracts forms to self-employment and informal work. And these different types of work are more or less included in pension systems through public and to some degree occupational or private pensions.
So it really matters what kind of work contract or whether one is self-employed in each country, how that is regulated by the pension system, whether one is included and therefore somewhat protected against poverty in old age. Moreover, contributory pensions are based on the employment years, the hours, the pay, all tend to be more limited for flexible jobs. However, we have also in some of the public systems some credits, for example, for mitigating the risk of unemployment or allowing some credits for child-caring years and therefore lower employment participation, particularly of mothers. However, occupational pension, we have to keep that in mind, are much less inclusive and dependent on either a general mandate, collective agreements in some countries, or really the decision of firms to provide such a scheme. In addition, voluntary pensions that have been also introduced in some countries across Europe depend on the capacity and the willingness to save and this is also limited for those in flexible employment.
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