Future trends in the economic well being of the older population in Europe

Gustavo De Santis, Università di Messina
Chiara Seghieri, University of Florence
Maria-Letizia Tanturri, University of Pavia

We try to assess the adequacy of the economic resources of the older population and we identify the most vulnerable profiles in selected European countries, now and in the next thirty years. In old age, the risk of poverty is higher than in the general population in most European countries, although home-ownership is more prevalent at this age. This risk of poverty increases with age and is higher for women; for the separated, the divorced and the never married, as compared to the married; for those with poor health, with scarce social relations and low education. Inter-country differences are not trivial: poverty is higher in UK, Portugal and Belgium, and lower in Germany, in the Netherlands and in Finland. What will the next 30 years be like? Assuming constant proportions of poverty within each "cell" (sex, age, and marital status), the overall relative prevalence of the poor should barely change, due to contrasting forces: ageing tends to inflate the proportions poor, but an increasing prevalence of people still married until late in life will counterbalance this trend. Although prospects for the future are not particularly bad, there are also important elements of potential fragility. For instance, household dimension, which is one of the elements that alleviate the risk of poverty, tends to shrink as time passes, and especially at older ages. But the greatest element of uncertainty for the future regards the capability of European social protection systems to uphold their standards in the face of the ageing process. We speculate on the role of macro factors, and discuss a few possible scenarios.