As a result of the 2017 pension reform, the part-time pension was replaced by the partial old-age pension. A review of the 30 year history of the part-time pension shows that it was particularly popular among white-collar workers. In 2016, every fifth retiree on a part-time pension worked in education.
A recent report published by the Finnish Centre for Pensions reveals that a total of 146,500 persons retired on a part-time pension in the period 1987-2017. The last part-time pensions were granted at the beginning of this year. The part-time pension was particularly popular among white-collar workers. The average part-time pension amounted to 761 euros/month.
“Of the new retirees on a part-time pension in the year 2005, about 61 per cent were white-collar workers. In 2015, the corresponding percentage was 68,” says Janne Salonen, economist at the Finnish Centre for Pensions.
Every fifth worked in education
Of the different professions, teachers were particularly interested in the part-time pension. In 2016, nearly every fifth retiree on a part-time pension worked in education.
“The professions of the part-time retirees vary a great deal. Most men (55%) on a part-time pension were managers and senior experts. Workers in the construction, repair and manufacturing fields, as well as in processing and transport industries were also well represented among the male part-time retirees,” Salonen explains.
Nearly half of the women on a part-time pension worked as experts. Many of them also worked in the education, caring, office, service, and sales professions.
Four facts about part-time pensions and the partial old-age pension
- It was possible to retire on a part-time pension from 1987 to 2017. It has been possible to retire on a partial old-age pension as of February 2017.
- Retirees on a part-time pension were allowed to do a limited amount of work. There are no limits to how much retirees on a partial old-age pension can work.
- The part-time pension amounted to 50% of the difference between the stabilised wages for full time work and the wages for part-time work. Retirees on a partial old-age pension can draw either 50% or 25% of the pension they have earned up to the time of retirement. The income they earn from work does not affect the amount of their partial old-age pension.
- The part-time pension did not affect the final old-age pension. The partial old-age pension has a permanent effect on the final old-age pension.
Janne Salonen, Economist, phone +358 29 411 2145, janne.salonen(at)etk.fi