Europeans lose faith in pension systems as retirement ages rise and demographic pressures mount
More than two-thirds of workers in major EU economies no longer believe that the current pension system will guarantee a decent standard of living in retirement, according to recent surveys. As retirement ages rise and private savings schemes gain prominence, concerns over inequality, demographic decline and the sustainability of Europe’s social model are intensifying.
Over the past decade, the average retirement age across Europe has increased by approximately 2.1 years, yet this adjustment has failed to offset the demographic “time bomb” facing the continent. An ageing population, shrinking workforce and slower economic growth are placing mounting pressure on public pension systems and social welfare budgets.
Despite policy changes, public confidence remains low. The average gross pension across the EU stands at around €1,440, with wide disparities between countries and persistent gender gaps. Many Europeans doubt whether this income will be sufficient to ensure a dignified life after retirement.
Widespread Insecurity Among Workers
A new YouGov survey conducted in five major EU member states highlights the depth of the problem. More than 70% of workers in Italy and Poland, 66% in France, and 64% in Spain say they are not confident they will have enough money to live comfortably once they retire.
Among the most popular proposals supported by both workers and retirees are measures to help older employees remain in the workforce longer, alongside increased contributions to occupational or private pension schemes.
However, critics argue that Brussels is increasingly shifting responsibility onto individuals. EU institutions continue to encourage member states to strengthen private pension systems, promoting occupational and personal savings plans as a way to preserve living standards and boost economic resilience.
Within this framework, the European Commission is pursuing a two-pillar approach aimed at reinforcing pension savings while mobilising up to €10 trillion in bank deposits to finance strategic priorities, particularly defence and digital transformation.
Selective Migration as a Partial Solution
Migration has long been identified as a partial response to Europe’s demographic challenges and the long-term viability of its pension systems. According to Eurostat, between 2014 and 2024 the share of working-age residents in the EU born outside the bloc rose from 8% to 12.6%. Employment rates among migrants increased and helped offset labour shortages across both high- and low-skilled sectors.
Yet Europe remains divided over migration policy. Critics argue that the EU’s emphasis on deterrence and “selective migration” prioritises economically “useful” migrants, weakening international protection standards. Initiatives such as the EU-wide talent pool for matching third-country nationals with labour market needs have sparked debate over fairness and human rights.
Greece: Record Retirements, Deepening Anxiety
In Greece, 2025 marked a historic peak in workforce exits. Applications for retirement submitted to the national social security fund (e-EFKA) exceeded 225,800, setting an all-time record. The surge reflects fears of future increases in retirement age, uncertainty over pension reforms, and the mass retirement of baby boomers — a trend expected to continue over the next five years.
International institutions have sounded the alarm. In November, the EBRD and the OECD warned that demographic decline poses one of the most serious long-term risks to Greece’s public finances.
Despite high pension spending — over 16% of GDP, among the highest in Europe — Greek pensioners remain the poorest in the eurozone. Around 1.3 million retirees receive just €845 gross per month as their main pension, struggling to keep up with inflation.
According to the OECD’s Pensions at a Glance 2025 report, population ageing will intensify most sharply in Greece, Italy, Poland, Slovakia and Spain, with ageing indicators projected to rise by at least 25 points by 2050.
The Greek government has postponed politically sensitive decisions on retirement age adjustments, effectively passing the issue to the next administration. Although retirement ages rose sharply during the austerity years — from 65 to 67 — further changes remain frozen since 2020.
Pension Reforms Across Europe
Across the EU, pension reforms vary widely:
- France has postponed its controversial pension reform until 2028, despite fiscal pressures to reduce the budget deficit below 5% of GDP by 2026.
- Italy maintains a retirement age of 67, tightening early retirement conditions by increasing contribution requirements.
- Spain continues to raise retirement ages gradually while offering financial incentives for delayed retirement, though uptake remains minimal.
- Poland’s lower retirement ages have led to employer-driven workarounds, often forcing older workers out despite their willingness to continue working.
- Austria has introduced partial retirement schemes combining part-time work with pension benefits, alongside debated incentives for employers.
- Lithuania raised its minimum retirement age to 65 this year, granting additional job protection for older workers nearing retirement.
A System Under Strain
As Europe grapples with ageing societies, labour shortages and fiscal constraints, pension systems are becoming a central fault line in the debate over the future of the European social model. With public trust eroding and inequalities widening, policymakers face mounting pressure to deliver reforms that balance sustainability, fairness and social cohesion.
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