Comparative Analysis of Pension Systems in Germany and Ukraine: Conditions, Trends, and Challenges
In contemporary European countries, the pension sector is increasingly becoming a subject of research and analysis due to its critical role in ensuring stability and citizens' well-being. Germany's pension system boasts extensive experience and a high level of social security, providing substantial support to retirees. Meanwhile, Ukraine faces significant difficulties stemming from military aggression and demographic challenges, which have severely impacted the sustainability of its pension system. According to German statistics, as of late 2023, over 1.4 million retirees in Germany were actively employed, accounting for approximately 6.5% of all pensioners. Notably, nearly 375,000 of these senior workers are engaged in more hours than the standards for part-time employment, demonstrating their active participation in the labor market even in older age. Comparing these figures with data from 2004, it becomes apparent that the number of working pensioners has quadrupled over two decades—from around 288,000 to well over a million and a half. At the same time, the total population of Germany has increased modestly, reaching over 84 million by early 2024, with pensioners numbering more than 21 million. The pension age in Germany is generally 67, though certain categories, such as miners, can retire as early as age 60, while others with extensive insurance periods—up to 45 years—may do so before age 65. The average pension for men hovers around 800 euros, whereas women receive approximately 420 euros, primarily due to lower labor participation and caretaking responsibilities. In eastern Germany, pension payments for women are higher by 300 euros, and for men by 100 euros, reflecting historical social and political factors of the former GDR. Ukraine's pension situation is vastly different and more challenging. As of January 2025, the Ukrainian Pension Fund reports over 10.3 million pensioners, of whom about 2.8 million are actively working, representing nearly 27% of pensioners. However, this figure is somewhat understated, as many pensioners work irregularly or unofficially, especially amid ongoing war conditions. The ongoing conflict has significantly influenced employment rates among seniors, and the prospect of raising the retirement age raises concerns since many Ukrainians lack sufficient insurance experience. Currently, the ratio of workers to pensioners is one-to-one, putting extraordinary strain on the pension system. The average pension in Ukraine is roughly 30% of an individual's previous salary, supplemented by government subsidies, which are increasingly strained due to inadequate income from social contributions. Given these circumstances, there is a real risk that the pension age could be increased, or social benefits reduced, potentially threatening the long-term stability of Ukraine’s pension system.