This article from Der Spiegel exposes that even the capitalist power-house, Germany, cannot provide for the future.
For decades, Germans have been able to live out their golden years in comfort. For decades, one of the certainties of life in Germany was that the next generation of retirees would be better off and live a more secure existence than the preceding one. It was viewed as a sign of economic success when Germany's senior citizens thronged the luxury decks of international cruise ships and were wooed by the advertising industry as an affluent consumer group. No other segment of the population currently has a lower risk of falling into poverty than pensioners.
For today's younger generations, however, the retirement dream is turning into a nightmare. Von der Leyen, a member of Chancellor Angela Merkel's conservative Christian Democratic Union, released data showing that, in two decades, the statutory pension will only be enough to guarantee a life on the edge of poverty, even for average earners.
Back in 2007, the government pension agency published a study called "Old-Age Pensions in Germany," which is the largest evaluation of pension data ever conducted for Germans born between 1942 and 1961. The results were alarming. They clearly showed that old-age poverty is increasing. The reason for this trend is clear: The number of Germans in irregular work situations has risen dramatically since 1996, from over 6 million to more than 10 million. This includes roughly 3 million mini-jobbers along with some 5 million part-time workers who contribute relatively little to state pension funds -- and can expect to receive relatively little in return. It also includes a large proportion of the 2.5 million freelancers and independent contractors who employ no one but themselves.
In addition, there is a rising number of low-wage earners. There are now some 8 million German employees who work for an hourly wage of less than €9.15, as revealed by a study conducted by the Duisburg-based Institute for Work, Skills and Training (IAQ). Researchers found that 1.4 million employees even earned less than €5 an hour in Germany, which has no statutory federal minimum wage. Figures from the German government's new report on provisions for old age, to be published in November, show that of the roughly 25 million employees in the country between the ages of 25 and 65 who make social security contributions, more than 4.2 million earn a gross monthly salary of less than €1,500. This only entitles these individuals to the legally guaranteed basic social security.
For decades, Germans have been able to live out their golden years in comfort. For decades, one of the certainties of life in Germany was that the next generation of retirees would be better off and live a more secure existence than the preceding one. It was viewed as a sign of economic success when Germany's senior citizens thronged the luxury decks of international cruise ships and were wooed by the advertising industry as an affluent consumer group. No other segment of the population currently has a lower risk of falling into poverty than pensioners.
For today's younger generations, however, the retirement dream is turning into a nightmare. Von der Leyen, a member of Chancellor Angela Merkel's conservative Christian Democratic Union, released data showing that, in two decades, the statutory pension will only be enough to guarantee a life on the edge of poverty, even for average earners.
Back in 2007, the government pension agency published a study called "Old-Age Pensions in Germany," which is the largest evaluation of pension data ever conducted for Germans born between 1942 and 1961. The results were alarming. They clearly showed that old-age poverty is increasing. The reason for this trend is clear: The number of Germans in irregular work situations has risen dramatically since 1996, from over 6 million to more than 10 million. This includes roughly 3 million mini-jobbers along with some 5 million part-time workers who contribute relatively little to state pension funds -- and can expect to receive relatively little in return. It also includes a large proportion of the 2.5 million freelancers and independent contractors who employ no one but themselves.
In addition, there is a rising number of low-wage earners. There are now some 8 million German employees who work for an hourly wage of less than €9.15, as revealed by a study conducted by the Duisburg-based Institute for Work, Skills and Training (IAQ). Researchers found that 1.4 million employees even earned less than €5 an hour in Germany, which has no statutory federal minimum wage. Figures from the German government's new report on provisions for old age, to be published in November, show that of the roughly 25 million employees in the country between the ages of 25 and 65 who make social security contributions, more than 4.2 million earn a gross monthly salary of less than €1,500. This only entitles these individuals to the legally guaranteed basic social security.
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