Pensions and Labour Market Participation: 2023
The data in this news release are derived from the Labour Force Survey (LFS) ad hoc module, which was carried out in 2023 and partly financed through EU grants. The LFS is a household-based survey that is used as a monitoring tool across the European Union to assess progress made in various spheres of labour market and social statistics.
The Commission Implementing Regulation (EU) 2020/1642 established a legal framework for collecting data on pension and labour market participation, focusing on individuals aged 50 to 74 living in private households. This module aimed to analyse the transition from employment to retirement, and provide comparable data on various pension types, average retirement age, early retirement, and the employment status of pension beneficiaries.
LFS results indicated that in 2023, 55,713 persons between the age of 50 and 74 years were receiving an old-age pension, encompassing statutory, occupational, and private pensions. A person may receive more than one type of pension. The most common type of pension was the statutory pension, either on its own or in combination with other pensions. In fact, 96.4 per cent of all pension beneficiaries claimed that they received such a pension.
Certain occupations like Police, Armed Forces, Civil Protection Officers and Prison Guards are entitled to an occupational pension upon completing 25 years of service. In fact, 12.3 per cent of pension beneficiaries were receiving an occupational pension, either alone or combined with other pensions. A lower share of pension beneficiaries (3.9 per cent) were receiving a private pension. This type of pension is obtained when a person voluntarily invests in a private pension scheme throughout their career, aiming to generate additional income upon retirement (Table 1, Chart 1).
Chart 1. Pension beneficiaries by type of pension
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Note: The total number of pension beneficiaries does not equal the sum of individual categories because a person may receive more than one type of pension.
LFS results showed that 63.0 per cent of all pension beneficiaries perceived their overall health to be good or very good. Another 31.1 per cent reported their overall health as fair, while 5.9 per cent perceived their overall health to be in a bad or very bad state.
A discrepancy was observed between the share of male and female pension beneficiaries. In 2023, approximately six out of every 10 pension beneficiaries were males. In fact, almost half of all males between 50 and 74 years were receiving a pension, compared to only 28.1 per cent of their female counterparts (Table 2, Chart 2a, 2b).
Chart 2. Pension beneficiaries
Males
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Females
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Almost 70 per cent of all pension beneficiaries had achieved a secondary level of education or less. A further 21.7 per cent obtained a post-secondary level, while 10.4 per cent attained a tertiary level of education.
The share of pension beneficiaries increased with age, influenced by the legal retirement age. In Malta, where the legal retirement age is 65 for persons born from 1962 onwards, 78.2 per cent of persons aged 65 to 74 were receiving a pension. The share decreased significantly for the 50 to 64 age group, with only 13.5 per cent receiving a pension (Table 2).
The average retirement age in 2023 was 61.3 years, slightly higher for females (61.8 years) when compared to males (61.0 years). The average age varied by pension type: 61.5 year for statutory pensions, 61.7 years for private pensions, and 57.8 years for occupational pensions. Almost all statutory old-age pension beneficiaries (90.5%) received their first old-age pension without any bonus or penalty (Tables 3 and 4).
Nearly nine out of every 10 pension beneficiaries were not in employment at the time of the survey (85.7 per cent). Conversely, 64.0 per cent of persons between 50 and 74 years who were not receiving a pension at the time of the survey were employed (Table 2, Chart 3).
Chart 3. Pension beneficiaries by labour status
Employed pensioners
LFS estimates indicated that 7,991 persons aged between 50 and 74 years receiving an old-age pension were still in employment during the survey reference week, with 70.9 per cent of them being males. The most common occupation among these employed pensioners was in the highly skilled non-manual category, which includes Managers, Professionals and Technicians and associate professionals, accounting for 35.7 per cent. The second most common occupation was in the low skilled non-manual category, comprising Clerical support and Service and sales workers at 30.9 per cent. Nearly half of all employed pensioners had a secondary level of education or less (48.3 per cent), while a further 29.8 per cent had attained a post-secondary level of education (Table 5, Chart 4).
Seven out of every 10 employed pensioners were employees. The majority of employed pensioners were working in the Services industry (80.0 per cent). This industry comprises the Wholesale and retail trade, transportation and storage, accommodation and food service activities sector (24.8 per cent), Public administration, defence, education, human health and social work activities (24.0 per cent) and Other services (31.1 per cent). Approximately nine out of every ten persons who were receiving an old-age pension were in indefinite employment.
On average, employed pensioners normally worked 31.2 hours per week, with 51.3 per cent engaged in a part-time job. Retired males worked slightly more hours than females, averaging 31.5 and 30.4 hours per week, respectively (Tables 5 and 6).
Chart 4. Employed pension beneficiaries by occupation group in main job
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Labour market transition upon receipt of old-age pension
Almost half of all pension beneficiaries (48.2 per cent) stopped working upon starting to receive their old-age pension, with a higher percentage of males (50.4 per cent) compared to females (44.3 per cent). Additionally, slightly over one-third of all pension beneficiaries were not working when they started receiving their old-age pension for various reasons, with the share being 8.1 percentage points higher for females (39.3 per cent) than for males (31.2 per cent) (Chart 5).
Furthermore, 17.7 per cent of pension beneficiaries continued working after receiving their first pension, with 8.0 per cent of them making some changes to their previous employment conditions (Table 7).
Chart 5. Employment situation at the beginning of old age pension by sex
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Over 40 per cent of pension beneficiaries who continued working did so for financial reasons, either out of necessity for additional income to maintain an adequate living standard or to earn extra money. A further 29.8 per cent continued working because they enjoyed their job or wanted to stay productive, while 27.8 per cent remained employed for other reasons such as maintaining social connections or because their partner or spouse was still employed (Table 8).
On the other hand, 62.5 per cent of pension beneficiaries stopped working immediately upon becoming eligible for their pension. Additionally, 15.0 per cent terminated their employment upon reaching the maximum legal retirement age, and 9.3 per cent ceased working due to illness or disability (Table 9, Chart 6).
Chart 6. Main reason for terminating employment at the start of pension receipt
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Disability pension and other disability periodic cash benefits
LFS estimates indicated that 2.2 per cent of all persons within the 50 to 74 year age group were receiving a disability pension or other disability periodic cash benefits, which is payable to persons who cannot engage in a full-time or regular part-time employment. The average age of persons at the time of their first disability pension or disability cash benefit was 48.4 years (Table 10).
Entitlement to old-age pension
Almost three out of every four persons between 50 and 74 years who were not receiving an old-age pension in 2023 were making financial provisions with the intention of receiving a pension in the future. This was significantly more prevalent among males (97.3 per cent) compared to females (55.0 per cent). Entitlement to an old-age pension for persons who were not receiving a pension at the time of the survey varied by age group. In fact, 90.2 per cent of all persons between 50 and 54 years reported being entitled to at least one pension in the future. The share was slightly lower among the 55 to 59 and the 60 to 64 age brackets, where 82.8 per cent and 74.9 per cent, respectively, claimed that they were entitled to a pension in the future (Table 11).
Almost all persons who were making financial provisions with the intention of receiving an old-age pension in the future claimed that they will receive a statutory old-age pension (97.2 per cent). A following 9.5 per cent were entitled to a personal pension while 3.5 per cent were entitled to an occupational pension upon reaching the legal retirement age (Table 12, Chart 7).
Chart 7. Pension entitlement by type of financial provision
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Note: The total number of pension provisions does not equal the sum of individual categories because a person may contribute to more than one type of pension.
Tables
Tables
Methodological Notes
1. The data provided in this release is based on the Commission Implementing Regulation (EU) 2020/1642 specifying the technical characteristics of the 2022 ad hoc subject ‘job skills’ and the eight-yearly variables on ‘pension and labour market participation’ in the labour force domain in accordance with Regulation (EU) 2019/1700 of the European Parliament and of the Council. The data was partly financed through EU grants.
2. During 2023, the ad hoc module was carried out on a sample of persons taking part in the LFS survey for the first and fourth time. The target population comprised individuals aged 50 to 74 years living in private households during the reference period.
3. The Labour Force Survey (LFS) is carried out on an ongoing basis using a quarterly gross sample of 3,200 private households. The objective is to have a continuous assessment of labour market trends given that the reference weeks are evenly spread throughout the 13 weeks of the quarter. One-fourth of the sample is made up of households who have been selected to participate in the LFS for the first time. Three-fourths of the quarterly sample is made up of households who were selected to participate in the survey in previous instances, either one quarter before, or one year before, or one year and a quarter before (2-(2)-2). All criteria used for this survey match international methodologies used by the International Labour Organisation (ILO).
4. The LFS is designed to satisfy the concepts and definitions as outlined by Eurostat. This allows the comparability of results with other EU member states and countries following ILO definitions of employment and unemployment. Occupations are classified according to the ISCO-08 classification (International Standard Classification of Occupations) whereas the economic activity is classified according to NACE Rev. 2 (Nomenclature générale des Activités économiques dans les Communautés Européennes). Education attainment is classified according to ISCED 2011.
5. Definitions:
● Disability benefit: refers to an income which is provided to persons below the legal retirement age whose ability to work and earn money is impaired by a physical or mental disability. It also includes rehabilitation services and early retirement benefits.
● Early retirement pension: refers to persons who retire before their legal retirement age.
● Educational attainment:
secondary or less level of education: comprising persons with no schooling, primary education, schools for children with special needs and persons who attained a secondary level education and have less than 2 ordinary level qualifications or equivalent. In the context of the ISCED classification, this includes ISCED 0 to 2;
post-secondary level of education: comprising persons with a secondary level education and having 2 ordinary level qualifications or equivalent or more, and persons with a post-secondary level attainment who have obtained at least 1 intermediate or advanced level qualification or equivalent. In the context of the ISCED classification, this refers to ISCED 3 and 4;
tertiary level of education: comprising persons with a tertiary level education and with qualifications ranging from diploma to doctorate level. In the context of the ISCED classification, this refers to ISCED 5 to 8.
● Employed persons: all persons aged 15 to 74 years, who during the reference week, were in one of the following categories:
worked for at least 1 hour for pay or profit, including contributing family workers and paid casual work;
persons with a job or business who were temporarily not at work during the reference week but had an attachment to their job, including;
(a) persons not at work due to holidays, working time arrangements, sick leave, maternity or paternity leave;
(b) persons in job-related training or formal education;
(c) persons on parental leave, either receiving and/or being entitled to job-related income or benefits, or whose parental leave is expected to be 3 months or less;
(d) seasonal workers during the off-season, where they continue to regularly perform tasks and duties for the job or business, excluding fulfilment of legal or administrative obligations;
(e) persons temporarily not at work for other reasons where the expected duration of the absence is 3 months or less.
unpaid family workers: refers to people who worked without pay in a family business or farm. Excluded from this definition are housewives.
● Health: refers to the self-perceived state of health and includes different dimensions of health, such as physical and emotional functioning, mental health and biomedical signs and symptoms.
● Occupation:
highly skilled non-manual: refers to ISCO 08 group codes 1 to 3 (Managers, Professionals and Technicians and associate professionals);
low skilled non-manual: refers to ISCO 08 group codes 4 and 5 (Clerical support workers and Service and sales workers);
skilled manual: refers to ISCO 08 group codes 6 to 8 (Skilled agricultural, forestry and fishery workers, Craft and related trades workers and Plant and machine operators and assemblers).
● Pensions: refers to regular payments, typically received monthly, and including individuals who receive pensions from abroad. The following types of pensions are included:
statutory pension: refers to an income provided by the Department of Social Security and it is based on an individual’s employment history.This category includes: Decreased National Minimum Pension, Increased Retirement Pension, National Minimum Pension/Increased National Minimum Pension, Retirement Pension, Two-thirds Pension, Old-age Pension, Foreign Pensions;
occupational pension: is a pension paid to public officers who joined the Public Service of Malta prior to 15 January 1979. Police, Armed Forces, Civil Protection Officers and Prison Guards are entitled to an occupational pension upon completion of 25 years of service. For the scope of this module, occupational pensions were considered as one type of old age pensions;
personal pension: refers to any plan, fund, or private scheme where individuals voluntarily invest throughout their life to generate additional income upon retirement. These pensions are typically managed by a pension fund or financial institution and do not include life insurance policies;
disability pension: Payable to individuals who are permanently unable to engage in suitable full-time or regular part-time employment. Examples include Invalidity Pension, Injury Pension, Decreased national invalidity pension, Increase injury pension, National minimum invalidity pension, Blind pension, Disability/Severely Disability Pension. Once the age of this recipient reaches the legal retirement age, s/he should be considered as receiving an old age pension.
● Pension with reduction in case of anticipated pension benefit: refers to a person who left the labour market before the time he/she was entitled to his/her “full” pension benefit and thus received a decreased pension.
● Pension with bonus due to retirement deferment: refers to a person who kept working to get an increased rate which is obtainable if he/she retires after the requirements to receive a “full” pension benefit are met.
● Retirement age: refers to the age at which individuals first received their pension . The retirement age varies based on the year of birth for different cohorts:
before 1952: Men: 61 years; Women: 60 years (Option 61 years);
in 1952 to 1955: 62 years;
in 1956 to 1958: 63 years;
in 1959 to 1962: 64 years;
from 1962 onwards: 65 years.
6. Key
: Unreliable – less than 20 sample observations.
U Under represented – between 20 and 49 sample observations.
7. Percentage totals may not add up due to rounding.
8. Absolute changes between one survey estimate and another must be treated with caution since minor changes (i.e. less than 2,500 persons) might be the result of sampling error.
9. More information relating to this news release may be accessed at:
Sources and Methods
Statistical Concepts
Metadata
ISCO Classification
NACE Classification
ISCED Classification
10. References to this news release are to be cited appropriately. For guidance on access and re-use of data please visit our dedicated webpage.
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Pensions and Labour Market Participation: 2023
- The most common type of pension was the statutory pension, reported by 96.4 per cent of all pension beneficiaries.
- Approximately six out of every 10 pension beneficiaries were males.
- The average retirement age in 2023 was 61.3 years.
- LFS estimates indicated that 7,991 persons between 50 and 74 years who were receiving an old-age pension were still in employment.
- Almost half of all pension beneficiaries stopped working once they started receiving their old-age pension (48.2 per cent).
- Almost three out of every four persons between 50 and 74 years who were not receiving an old-age pension in 2023 were making financial provisions with the intention of receiving a pension in the future.
Pensions and Labour Market Participation: 2023
The implementation of the Labour Force Survey (LFS) 2023 module on Pensions was partially funded by the European Union.
