Gender inequalities in old age:

pension gaps from an intra-household

perspective

Cristina Freguja

Silvano Vitaletti

(Istat - National Institute of Statistics)

Vilnius, 2 June 2016

Work Session on Gender Statistics

CONTENTS

Background

Statistical characterization of the pensioners in Italy

Contribution of the pension to the household income

Degree of economic dependence from the others

members of the households

Background

Pensions are a key determinant of the economic

independence of their beneficiaries.

The gender gap in pensions represents the sum of gender

inequalities in the life course and labor market, driven by

gendered social norms and stereotypes.

Important gender differences in the labor market and with

regard to the job remuneration are still observed in the

younger generation.

The effects of the gender gap in pension need to be

analyzed also using intra-household indicators.

PENSIONS: GENDER GAP IN EU

Gender Gap in Pensions1 and Gender Gap in Coverage by the

pension system source

Source: European Commission, The gender gap in pensions in the EU, 2013

1 - The Gender gap in pensions is the percentage by which women’s

average pension is lower than men’s.

Statistical characterization of the Italian pensioners 1/1

Effect of the demographic structure:

Women represent the majority of pensioners→ 52.9%;

the average age of women who receive a pension is higher

than that of male in the same situation → 71.8 versus 68.6

years

Effect of lower participation and permanence of

women in the labor market:

dependency ratio, i.e. the number of pensioners compared to

the number of the employed population is 93.4 for women,

and 59.8 for men

Statistical characterization of the Italian pensioners 2/2

Women receive, on average, a monthly amount of income from

pension significantly lower than that of men (1.095 versus

1.549 euros - 2014)

The retirement income difference is 41.4% and rises to 52.2%

among new retirees and to 62.2% considering the amount of the

single pension benefit

The difference decreases during the retirement period since, with a

longer life expectancy, women accumulate more frequently also

survivors' pensions.

In last decade, there was a reduction of the differences thanks to the

cohorts of women with longer and regular working careers than in

the past (in 2004 the pension gap was 44,9%)

Contribution of the pension to the household income 1/2

The contribution of pension to household income varies depending on

the type of household in which people live in the last phase of life.

Retirement age, life expectancy, age of partners determine a different

distribution of male and female pensioners in different type of

households.

The female pensioners (after retirement from employment) live

alone (36%)

in couple without children (35%)

in couple with children (12%)

single mother (7%)

with aggregate members (10% - 7% of them is the aggregate member).

Among male pensioners, the share of those living alone is reduced to less

than half (16,8), while it is much larger (51%) that of those living in couples

without children and about double (24%) in couples with children.

9% of males live with aggregate members (3% of them is the ag. member)

Contribution of the pension to the household income 2/2

The contribution of female pensions to the household incomes decreases with the

increasing of the level of the household income

Income quintiles (*) Women Men

1 79 79

2 66 73

3 56 67

4 50 58

5 39 48

In average, the female pension (65+) accounts for….

92% of the total household income where she lives alone (90% for men living in a

same type of living arrangement)

50% for single mothers

36% for women in couples without children (66% for men)

26% for women in couples with children (44% for men)

33% for women living in households with aggregate members (42% for men)

the contribution of men,

with the exception of the

first quintile, is always

higher

The female pension emerges as an important source of

income especially for the most vulnerable families

Gender pay gap and Gender pension gap affect the degree of

economic dependence of women and men from the other

members of the household

The economic dependence can penalize individuals in terms of

bargaining power within the couple and with other members, and can

make easier discriminatory behaviors

A simple method allows to assign to each member of the household

the income made available by others in the household (indirect

income), distinguishing it from the earned income (direct income).

It allows to analyse the degree of economic dependence, by relating

it to the different patterns of living arrangements.

Indirect income can be decomposed by type (from work, pension, etc.),

making possible to analyse the sources of livelihood, direct or

indirect.

Degree of economic dependence from the household 1/3

The method assumes that….

each earner in the household contributes to a single deposit of

income available to the whole family and this amount is divided equally

among all the components (income pooling).

Under this hypothesis….

each household member meets the common expenses (for his/her

own part) and the personal expenses necessary to ensure the same

standard of living of the rest of the family.

the surplus income is saved in a single fund at the disposal of the

whole household.

This hypothesis is consistent with the practice of using the “equivalent

income" for the analysis of inequality among people living in households

with different number of members and different composition.

Nevertheless, in some populations or social groups it may have a limited

degree of acceptability according to the spread of gender discriminatory

practices within families.

Degree of economic dependence from the household 2/3

Intra-household income redistribution

Per capita household income as personal income after intra-household redistribution n household members, m income sources (excluding common household income sources)

n

i

m

j

jii Yn

Y1 1

,

1

It can be decomposed into:

• direct personal income: the minimum

between earned income and per capita

income

• indirect personal income: the difference

between per capita income and earned

income, if positive, 0 elsewhere

m

j

m

j

dep

ji

dir

ji

dep

i

dir

ii YYYYY1 1

,,

Decomposition of direct and indirect incomes into m

different sources is achieved by re-proportioning the

different amounts at household level

m

j

iji

dir

i YYY1

, ;min

m

j

jii

dep

i YYY1

,;0max

m

j

m

j

Gi

i

Gi

dep

ji

Gi

i

Gi

dir

ji

Gi

i

Gi

dep

i

Gi

i

Gi

dir

i

Y

Y

Y

Y

Y

Y

Y

Y

1 1

,,

1

Degree of intra-household

economic dependence for

individuals belonging to G

group

Degree of intra-household

economic dependence

Country

All

pensioners

55 and over

Pensioners 55

and over living

in couple IT Male 3,6 4,2

Female 17,0 32,4 ES Male 3,0 3,2

Female 13,6 25,7

FR Male 3,0 4,1 Female

13,7 26,6 DK Male 4,3 6,9

Female 9,3 20,3 UK Male 5,1 6,1

Female 22,6 37,8

The economic dependence of

female pensioners is more severe

than for male pensioners and it is

greater for women living in couple

Source: own estimation from

EU-SILC, 2013

The rights of women on social insurance are often ‘derived rights’

(survivors’ pensions)

Source: own estimation

from EU-SILC, 2013

At the same age, male and female

pensioners living without a partner have an

higher risk to be poor. For women the risk is

higher than for men

Source: own estimation from EU-SILC, 2013

A higher level of education does not always guarantee a lower

economic dependency for female pensioners (aged 55+).

Source: own estimation

from EU-SILC, 2013

In conclusion…

• Differences in pension contribute to determine gender differences between the

sexes in later life as regards capacity of an individual to lead an independent

life and to take decisions for him/herself.

• the indicators proposed by the most advanced literature in the domain (Bettio et

al. 2013; Tinios et al. 2015; Betti et al. 2015) allow to define the framework of

gender imbalance in old age, considering

the extent to which individuals have access to the pension system

(coverage gap)

the difference in pensions (excluding or including non-pensioners: pension gap

and elderly pension gap)

the intra-household difference between ‘his’ and ‘her’ pension (Intra-household

gender gap in pension)

The indicator proposed in this presentation - the degree of intra-household economic

dependence - is a further proxy measure of capacity for individual choice.

It breaks down personal income and indirect income by highlighting the sources of

livelihood. The inequalities by gender in old age are observed from a further and larger

visual angle.

References

• Betti, G., Bettio, F., Georgiadis, T. and Tinios, P. (2015). Unequal Ageing in Europe:

Women’s Independence and Pensions, New York: Palgrave Macmillan.

• Bettio, F., Tinios, P., and Betti, G. (2013). The Gender Gap in Pensions in the EU.

Report prepared for the European Commission, Directorate-General for Justice; Unit

D2 “Equality between Men and Women”. Available at:

http://ec.europa.eu/justice/gender-equality/tools/experts/index_en.htm

• Tinios, P., Bettio, F. , and Betti, G. (2015). Men women and pensions. Report

prepared for the European Commission, Directorate-General for Justice; Unit D2

“Equality between Men and Women”. Available at:

http://ec.europa.eu/justice/gender-quality/files/documents/150618_men_women_pensions_en.pdf

Thanks for your attention!