Employment trajectories of German baby boomers and their effect on statutory pension entitlements

Increasing disruptions and heterogeneity in employment biographies, a growing number of unemployment experiences, later labour market entries, and an increase in atypical forms of employment lead to declines of statutory pension entitlement accumulation over the life course. Moreover, in accordance with Easterlin (1987), significant economic disadvantages can be expected for large generations. In fact, the German baby boomers born in the 1950s and 1960s, the next generation of pensioners, will have to accept several additional pension cuts due to pension reforms. Against this background, we ask how different employment patterns are related to disproportional statutory pension entitlements for German baby boomers in the middle of their working life. We examine work trajectories and their implications for accrued statutory pension entitlements by the age of 42 for two baby boomer cohorts in comparison to two older cohorts. For our analyses, we employ the Biographical Data of Selected Insurance Agencies in Germany (BASiD) for those born in 1947, 1953, 1959 and 1965 (N = 25,863). In the first step, we summarise the most important employment patterns of the cohorts under study. In the second step, we test the influence of these employment patterns on the accumulation of individual statutory pension entitlements until the age of 42 and compare the baby boomer cohorts to previous cohorts. We find that late entries to employment as well as diversified and unstable employment are related to lower levels of statutory pension entitlements for particular groups of German baby boomers.