Persons Insured for an Earnings-related Pension in Finland

Producer: Finnish Centre for Pensions
Website: Persons insured for an earnings-related pension in Finland
Subject area: Social security
Part of the Official Statistics of Finland (OSF): Yes

Description

The statistics describe persons insured under the Finnish earnings-related pension scheme, employees’ insured earnings and self-employed persons’ insured incomes.

Data content

The statistics contain key numerical data on all persons aged 17–68 insured under the Finnish earnings-related pension scheme and on persons who have retired. In addition, the statistics provide information on employees’ insured earnings, self-employed persons’ insured incomes and pension accrued on the basis of benefits received during unpaid periods and under the Act on Compensation for Pension Accrual from State Funds for Periods of Caring for a Child Aged under Three and Periods of Study.

Categorizations

Private and public sector, earnings-related pension act, gender and age.

Methods of data collection and source

The statistics are based on data drawn from earnings and pension registers under the earnings-related pension scheme.

Update frequency

Once a year.

Time of completion or release

The statistics are released at the end of the year following the statistical year. For a more detailed schedule, consult the Release Calendar.

Time series

The statistics have been compiled since 2005. Time series for the private sector go back to 1977. The data are in the main comparable from 2007 onwards. The statistics on insured incomes for the self-employed have been produced for the statistics on Persons Insured for an Earnings-related Pension in Finland as of the beginning of 2022.

Key words

insurance, social insurance, pensions, earnings-related pensions, employment relationship, employees, wages, self-employed, insured income

Contact information

• Contact our statistics service with this online form

Concepts relating to working

Covered by the earnings-related pension scheme

Persons covered by the earnings-related pension scheme refer to those who have been employed or self-employed during the statistical year or earlier. In other words, the earnings-related pension scheme covers those persons who are entitled to an earnings-related pension at the time of the pension contingency or who already receive a pension based on their employment history.

Earnings-related pension act

Persons are classified as covered by all earnings-related pension acts under which they have been insured during their employment history.

Earnings-related pension sector

Persons are classified into pension sectors based on the earnings-related pension acts applicable during their employment history. If they have been employed in both the private and public sector, they will be included in the figures for both sectors.

Employed at the end of the statistical year

A person employed at the end of the year is someone who has been employed in December (employment relationships based on a monthly notification) or whose employment relationship has ended or been in force at the end of the year (employment relationships based on an annual notification). Pension recipients who are in employment or self-employment while drawing a pension are classified as being employed.

Employed or self-employed

An employed person is someone who during the statistical period has been in employment that accrues earnings-related pension, or who has been insured for earnings-related pension under the Self-Employed Persons’ Pensions Act or the Farmers’ Pensions Act.

Employee

An employee is a person who has engaged in work that is covered by earnings-related pension acts, excluding the Self-Employed Persons’ Pensions Act (YEL) or the Farmers’ Pensions Act (MYEL). In practice, this means all employees excluding self-employed persons, farmers and recipients of science and arts grants. In these statistics, employees also include special groups covered by JuEL (municipal), such as persons elected to a position of trust and family carers. Private caretakers who have signed a commission agreement although they are not in an employment relationship with a municipality or a municipal federation as referred to in the Contracts of Employment Act are also considered employees.

Not employed during the statistical year

A person who is not employed during the statistical year is someone who has not engaged in employment that accrues earnings-related pension or who has not been insured for an earnings-related pension based on the Self-Employed Persons’ Pensions Act or the Farmers’ Pensions Act. In addition, it is required that this person has been insured for an earnings-related pension before the statistical year or that this person receives a pension based on their employment history.

Pension recipient

A pension recipient is a person who receives an earnings-related pension based on their employment history. A pension recipient may receive an old-age, disability or part-time pension or a farmer’s special pension. Some pension recipients additionally receive pension benefits paid out by Kela; these benefits are not considered in these statistics.

Person covered by the earnings-related pension scheme for the first time

A person is covered by the earnings-related pension system for the first time when they enter into their first employment relationship or period of self-employment that must be insured under earnings-related pension legislation. This first employment relationship determines the sector used in the statistics.

Person covered by various earnings-related pension acts for the first time

A person is covered by an earnings-related pension act when they enter into their first employment relationship or a period of self-employment that must be insured under the earnings-related pension act in question. For example, if a person has entered into their first employment relationship that is to be covered by the Employees Pensions Act (TyEL) and their first relationship that is to be covered by the Local Government Pensions Act (KuEL) in one and the same year, the person is recorded in the statistics for both acts.

Persons insured for earnings-related pension benefits

Persons insured for earnings-related pension benefits are those who during the statistical year or earlier have been employed or self-employed and who at the time of the pension contingency are entitled to an earnings-related pension. Typically, a person insured for earnings-related pension benefits has not yet retired, but even a retiree may be insured if they have been working while in retirement under age 68.

Self-employed person

A self-employed person is a person who is covered by the Self-employed Persons’ Pensions Act and has or has had valid insurance under the Self-employed Persons’ Pensions Act or the Farmers’ Pensions Act in the statistical year or earlier. Farmers and recipients of science and arts grants are covered by the Farmers’ Pensions Act.

Working during the statistical year

Persons are considered to have worked during the statistical year if, during that time, they have engaged in employment that accrues earnings-related pension or if they have been insured for an earnings-related pension under the Self-Employed Persons’ Pensions Act or the Farmer’s Pensions Act.

Concepts relating to earnings

Annual and monthly earnings

In these statistics, the earnings for employees are the earnings insured for an earnings-related pension, and for self-employed persons, their insured incomes. For employees, the annual earnings are calculated by adding up the monthly insured earnings received during a calendar year. For the self-employed, the annual earnings are the actual insured incomes relative to the period of validity of the insurance while the monthly earnings are calculated by the number of months during which the insurance is valid.

• Example. An employee was in employment from 20 August to 10 September, with insured earnings of 2,000 euros. In this case the monthly earnings entered in the statistics were 2,000 euros/2 = 1,000 euros/month, because the employment spell stretched across two different months. If the employment spell had taken place during one month (e.g. from 2 to 22 September), then the monthly earnings would have been 2,000 euros. If this was the employee’s only spell of employment during the calendar year, the annual earnings entered in the statistics would in both cases have been the same, i.e. 2,000 euros.

Benefits accrued from unpaid periods and under VEKL

Unpaid periods are periods during which a person receives a social benefit that may, under certain conditions, affect pension accrual. Unpaid periods include periods on a parental, sickness or unemployment allowance. The grounds on which various unpaid periods impact on the final amount of earnings-related pension are set out in earnings-related pension acts.

Benefits accrued on the basis of child home care allowance and the completion of degrees and qualifications are funded by the State. These benefits are based on the Act on Compensation for Pension Accrual from State Funds for Periods of Childcare and Periods of Study (VEKL).

The benefits received for unpaid periods and based on VEKL are recorded in the earnings-related pension scheme’s earnings register. Benefits for unpaid periods are also recorded for persons who have no employment history and who therefore are not covered by the earnings-related pension scheme.
It is noteworthy that it is possible during unpaid periods to undertake work that is insured for an earnings-related pension and that counts towards the person’s pension accrual.

Employees’ insured earnings

For employees, insured income (or shorter, insured earnings or earnings) consists of items of income for which earnings-related pension accrues. The main part of earnings is the wage, performance bonus or other compensation paid for work done. The most significant other compensation includes various fringe benefits and holiday remunerations, including compensation paid when the employment relationship ends (e.g., compensation for untaken saved holidays). As a rule, no pension accrues for daily allowances and share option arrangements, and these compensations are not included in the insured incomes. In these statistics, insured incomes also include the pension contributions paid by employees even when no pension accrued for these payments before 2017.

Self-employed person’s insured incomes

These statistics review the insured incomes of self-employed persons insured under the Self-employed Persons’ Pensions Act (YEL), considering any supplementary or reduced earnings-related pension contributions paid (YEL Chapter 67). For those insured under the Farmers’ Pensions Act (MYEL), this means their confirmed income.

Upper and lower limit of  incomes

The confirmed monthly income of a self-employed person must be at least 8,575.45 euros (under the Self-employed Persons’ Pensions Act) or 4,287.73 euros (under the Farmers’ Pensions Act) at 2023 level. The upper limit of the confirmed annual income for a self-employed person under the Self-employed Persons’ Pensions Act is 194,750.00 euros at 2023 level. The limits change annually in line with the change in the wage coefficient.

Other concepts

Age

Person’s age at the end of the statistical year.

Decile

Deciles are used to divide employees into ten equally large earnings groups. Decile boundaries indicate the level of earnings beneath which lie 10%, 20%, … , 90% of all cases.

Median

When all employees are rank-ordered according to earnings, median earnings are the mid-point of the earnings distribution. There are exactly the same number of employees above the median as below the median. The median is less sensitive to outliers than the average. Especially in skewed distributions such as those of earnings, the median gives a better representation of central tendency than average.

Earnings-related pension acts

Private sector

• TyEL Employees Pensions Act
• MEL Seafarer’s Pensions Act
• YEL Self-employed Persons’ Pensions Act
• MYEL Farmers’ Pensions Act

Public sector

• JuEL The Public Sector Pensions Act came into force at the beginning of 2017. It combined the previously valid public sector pension acts such as the Local Government Pensions Act, the State Employee’s Pensions Act, the Evangelical-Lutheran Church Pensions Act and the special act for Kela employees. Pensions for the employees of the Bank of Finland have been regulated under the Public Sector Pensions Act since the beginning of 2021. As of the beginning of 2023, also the wellbeing services counties are covered by the Public Sector Pensions Act.
• Pension regulation for the regional government of Åland

1. Contact

1.1 Contact organisation

The Finnish Centre for Pensions

1.2 Contact organisation unit

Planning Department

1.3 Contact name

Jari Kannisto
Marjo Kaasila

1.4 Contact person function

Statistical expert

1.5 Contact mail address

The Finnish Centre for Pensions
FI-00065 ELÄKETURVAKESKUS
Finland

1.6 Contact email address

firstname.lastname@etk.fi
Contact form

1.7 Contact phone number

+358 29 411 20

1.8 Contact fax number

Fax: +358 9 148 1172

2. Metadata update

2.1. Metadata last certified

28 Nov 2024

2.2. Metadata last posted

28 Nov 2024

2.3. Metadata last update

28 Nov 2024

3. Statistical presentation

3.1. Data description

In Finland, work done by individuals aged 17–68 is subject to earnings-related pension insurance. The statistics provide an overview of the employment and retirement situations of individuals aged 17–68 who are covered by the earnings-related pension system, as well as the earnings and income that contribute to their earnings-related pensions. The statistics also include information on individuals who have received social benefits that affect the amount of their earnings-related pension.

3.2. Classification system

Persons covered by the earnings-related pension system are divided into those insured for earnings-related pensions and those who are retired. The number of persons insured for earnings-related pensions is classified into two groups: those who were employed at the time of the statistics and those who were not employed nor retired at the time of the statistics. Other classifiers used include the earnings-related pension sector and act, as well as the person’s age and gender.

Average and median earnings and incomes data for those insured for earnings-related pensions are presented, classified by earnings-related pension sector and act, as well as by gender and age. The distribution of earnings is detailed by gender and age group.

The number of persons who have received benefits that accrue earnings-related pensions during unsalaried periods is presented, classified by type of benefit.

3.3. Sector coverage

The statistics are based on comprehensive data, so they include all individuals aged 17–68 covered by the earnings-related pension system.

3.4. Statistical concepts and definitions

The concepts and definitions have been presented on the statistics page.

3.5. Statistical unit

Person covered by the earnings-related pension system.
Earnings and incomes for which earnings-related pensions have accrued.

3.6. Statistical population

Persons covered by the Finnish earnings-related pension system.

3.7. Reference area

Finland

3.8. Time coverage

The basic data of the statistics are available from 2005 onwards. For the private sector, the time series starts from 1977. The earnings-related pension-insured earnings data for employees have been produced in the statistics since 2015, and the insured incomes for the self-employed has been included since 2022.

4. Unit of measure

Number of persons.
Earnings and incomes: €/month and €/year (gross amounts).

5. Reference period

Calendar year and 31 December

6. Institutional mandate

6.1. Legal acts and other agreements

The Act on the Finnish Centre for Pensions states that the Finnish Centre for Pensions is responsible for statistical activities within its field of competence.

6.2. Data sharing

Part of the data is delivered to Statistics Finland for the statistics Employment.

7. Confidentiality

7.1. Confidentiality – policy

The Finnish Centre for Pensions is committed to data protection as a fundamental principle of statistics, which ensures the confidentiality of data.

7.2. Confidentiality – data treatment

Data is protected by the necessary physical and technical solutions at the various stages of processing. Employees have access only to the data necessary for their work. Third parties do not have access to the premises where the data is processed. Employees are required to sign a confidentiality agreement when they are hired.

8. Release Policy

The statistics of the Finnish Centre for Pensions are released on weekdays at 9.00 a.m. on the website of the Finnish Centre for Pensions. Any exceptions to the release time are announced separately.

The data in the statistical database are released as open data. The database’s open interface can be freely used under the CC BY 4.0 license, with the Finnich Centre for Pensions being cited as the source of the statistical data.

8.1. Release Calendar

The release dates of the statistics are published in the release calendar. The release calendar for the following year is published towards the end of the year.

8.2. Release calendar access

Release Calendar

8.3. User access

The statistics are available to everyone when they are published on the website of the Finnish Centre for Pensions at a previously announced date.

Embargo policy: Media that are bound by the journalist’s guidelines may request material from the Finnish Centre for Pensions’ Communications Department.

9. Frequency of dissemination

The statistics are published once a year.

10. Accessibility and clarity

10.1. News release

The releases of the statistics can be found in the shared open repository Julkari: Persons Insured for an Earnings-related Pension in Finland (Julkari).

Press releases on this topic can be found online at the website of the statistics.

10.2. Publications

Persons insured for an earnings-related pension in Finland (Julkari)
Persons insured for an earnings-related pension in Finland, 2013–2020 (Julkari)
Pensioners and insured in Finland, 2005–2013 (Julkari)

10.3. Online database

Persons insured for earnings-related pension (PxWeb)

10.4. Microdata access

At the Finnish Centre for Pensions, we can extract research material from our registers for scientific research. We disclose the data in compliance with the principles of the Act on the Openness of Government Activities and the Data Protection Act. As a rule, we do not disclose register data for commercial purposes. The scientific research must be identified.

Apply for research access to register data of the Finnish Centre for Pensions (pdf)

11. Quality Management

11.1. Quality assurance

The Finnish Centre for Pensions is committed to the quality principles of Official Statistics of Finland. Our statistical production follows the quality criteria of Official Statistics of Finland, which are compatible with the European Statistics Code of Practice.

11.2. Quality assessment

The quality of statistics is assessed at several stages in the statistical process.

12. Relevance

12.1. User needs

Feedback from users is gathered through customer surveys. Feedback is also collected through direct contact. The feedback received is monitored and taken into account in the development of the statistics.

13. Accuracy and reliability

13.1. Overall accuracy

The data is based on administrative registers. The initial data is at the individual level, and it determines the amount of the insured person’s annually accrued earnings-related pension and the final earnings-related pension.

13.2. Sampling error

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13.3. Non-sampling error

The data is based on register extracts made at a specific point in time, so the statistics reflect the situation at the time of extraction. The registers are continuously updated, and retrospective changes are also made to them.

14. Timeliness and punctuality

14.1. Timeliness

The statistics are published towards the end of the year following the statistical year.

15. Coherence and comparability

15.1. Comparability – geographical

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15.2. Comparability – over time

The statistics has been produced since 2005. The data in the statistics are broadly comparable between different years from 2007 onwards. There may be small differences in the figures due to corrections and changes made to the statistical software.

The comparability of time series is affected by the following changes:

Due to the 2017 pension reform, the lower age limit for mandatory insurance for employees was lowered to 17 years. This increased the number of young people insured for earnings-related pensions.

The 2017 pension reform raised the retirement age by three-months increments for each cohort starting from those born in 1955. For those born in 1962, the retirement age is 65 years, whereas for those born in 1954, it was 63 years. This change has a significant impact on the number of people aged 63 who are still working.

As the retirement age rises, the age when the insurance obligation ends also rises. For those born between 1958 and 1961, the insurance obligation ends at age 69, and for those born in 1962, at age 70. This change raises the insured populations’ age at when the insurance obligation ends and thus expands the number of age groups examined in the statistics.

Starting from the 2019 data, the earnings information of employees stored in the earnings-related pension system’s register is based on the Incomes Register maintained by the Tax Administration. With the introduction of the Incomes Register, the number of months that wages have been paid over the year has become more specific. Previously, the reported earnings-related pension-insured earnings and periods of work for an employee’s employment relationship were reported once a year and may have included unsalaried periods. Since the Incomes Register only includes months in which wages were paid, monthly earnings are more accurately allocated to the months with wage payments.

The change in the data basis increased the monthly earnings of the public sector and especially the municipal sector under the Public Sector Pensions Act (JuEL), making the change compared to monthly earnings before 2019 appear larger than it is. However, the impact is small when comparing all employees and private sector employees. The change does not affect the comparison of annual earnings.

Additionally, because of the introduction of the Incomes Register, some tables describing the situation at the end of the year in the statistics show a slight shift from the group “employed” to the group “not employed, not retired,” especially in the private sector. This change may complicate comparisons with statistical years before 2019.

In 2020, the statistical history of benefit information for unsalaried periods up to 2019 was updated according to the register situation in August 2020, as some of the benefit information for unsalaried periods had been retrospectively corrected.

From the 2022 data onwards, the definition of those in the municipal sector under JuEL who are not in an employment relationship or who work as civil servants (including family caregivers, private caregivers, trustees, etc.) has been changed. Persons without registered income from this activity have been removed from the statistics.

From the 2022 data onwards, the statistics on employees’ earnings include all those covered by the municipal sector insurance under JuEL. Before 2022, the earnings statistics for insured persons in the municipal sector under JuEL only included those in employment or who worked as civil servants.

15.3. Coherence – cross domain

Differences in the definitions of concepts and the data basis make it difficult to compare with other statistics in the same statistical area.

16. Cost and burden

The production of the statistics is financed annually by the Finnish Centre for Pensions.

17. Data Revision

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18. Statistical processing

18.1. Source data

The statistics are based on the registers of the Finnish Centre for Pensions.

18.2. Frequency of data collection

–

18.3. Data collection

Administrative registers.

18.4. Data validation

Adjustments are made at different stages of statistical production in accordance with the production processes of the Finnish Centre for Pensions. In addition, the results are compared with changes in legislation and with data from previous statistical years.

18.5. Data compilation

The data is extracted from the registers of the Finnish Centre for Pensions. Further processing produces aggregated data and statistical tables.