Women's retirement benefits in the East are significantly greater, amounting to 357 euros more, compared to the West. Consequently, this disparity holds meaningful implications.
A significant disparity in average pensions for women exists between Eastern and Western Germany, with women in the East receiving higher benefits compared to their Western counterparts. The district of Potsdam in Eastern Germany sees an average monthly pension of 1314 euros for women, while in Western German states, the average falls below 1000 euros.
The Rhineland-Palatinate Eifel district of Bitburg-Prüm has the lowest average monthly pension for women in Germany at 668 euros, while the district of Waldshut in the Black Forest holds the same position for men, with an average of 1201 euros.
Several interrelated structural and labor market factors contribute to this pension gap. Higher unemployment rates and economic transitions after reunification have led to more disrupted work histories and reduced pension entitlements for women in Eastern Germany, especially in the age group around 60–62.
Gender roles in Germany, which push women more often into part-time and low-wage jobs, result in lower lifetime earnings and subsequently lower pension entitlements. This issue is magnified for women in the East, who faced new employment challenges along with traditional gender roles, leading to fewer opportunities for long, steady careers that feed into pension benefits.
Women's careers are frequently interrupted due to childbirth and caregiving responsibilities, impacting their pension accumulation. This issue is particularly pronounced for women in the East, who, after reunification, faced new employment challenges along with customary gender roles, resulting in fewer opportunities for long, steady careers that feed into pension benefits.
Poverty risks are higher in Eastern Germany, with older women especially vulnerable due to lower pension incomes. The social security system's inadequacy, combined with less access to benefits and "hidden" poverty, emphasizes the disadvantage faced by women in the East.
Persistent gender inequalities in the labor market, such as wage gaps and fewer promotions for women, exacerbate these differences, especially where economic reshaping after reunification led to significant job losses and shifts in industry.
The Prognos Institute and the Gesamtverband der deutschen Versicherungswirtschaft (GDV) calculated this difference in average pensions between Eastern and Western Germany. Moritz Schumann, deputy CEO of the GDV, stated that the lower pensions for women in the old states are due to women paying less into pension funds and retirement savings due to career breaks and part-time work.
In contrast, the West-East gap in men's pensions is minimal, with men in the West receiving an average of 1430 euros, and men in the East receiving 1416 euros. On average, a woman in the East receives 357 euros more in pension than a woman in the West. However, in 2023, there was no eastern German state where the average pension for a woman was less than 1100 euros.
The employment participation of women in the East has always been higher, a legacy of past East German times. Many women in the former East Germany worked in full-time jobs, made possible by extensive state childcare. The extensive state childcare in former East Germany contributed to more women working in full-time jobs, resulting in higher pensions.
Despite these findings, the large gap in average pensions between Western and Eastern Germany persists. The reasons behind this disparity highlight the need for continued efforts to address gender inequalities in the labor market and social security system to ensure fairer pensions for all German citizens.
- The Prognos Institute and the Gesamtverband der deutschen Versicherungswirtschaft (GDV) discovered that the science behind pension calculations in Germany reveals a significance in the disparity between Eastern and Western German states, with women in the East receiving higher benefits due to factors such as more employment opportunities, fewer career breaks, and higher participation in full-time jobs.
- Recognizing the importance of health-and-wellness and womens-health, policymakers ought to consider the impact of lackluster pensions on the well-being of older women in Eastern Germany, who are more susceptible to poverty due to lower pension incomes and less accessible benefits.
- Businesses and financial institutions in Germany may want to prioritize initiatives that tackle the persistent wage gaps and job losses in Eastern Germany, given that these problems are key contributors to the sizeable pension disparity between the East and the West, especially among older women.
