The Retirement of the Migrant Labor Force: Pension Portability and Beyond

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The Retirement of the Migrant Labor Force: Terms of use: Documents in EconStor mayPension Portability and Beyond AbstractThe specificities of the workforce with a migrant background are often neglected in studies of retirement. Similarly, many studies of migration's impact on pensions often focus on aggregate outcomes -system sustainability or distributive characteristics. The present paper provides a fresh look at the nexus between these two literatures. It discusses the impact of the European social security coordination mechanisms on individual decision-making and on the functioning of social security systems -with a focus on retirement. The paper argues that such effects are non-negligible and are likely to have major policy consequences.JEL-Code: F220, H750, J260, J610.

How portable is social security for migrant workers? A review of the literature

“…Multilateral agreements are usually agreed between a group of countries at regional levels, such as the Caribbean Community (CARICOM) Reciprocal Agreement, the MERCOSUR International Agreements System or the European Union regulations EC No. 883/2004, 987/2009 (Holzmann and Koettl, , p. 19; Jousten, , p. 11), among others.…”

“…This is reflected in the fact that only a very small share of EU citizens perceive the lack of portability as an obstacle to relocate to another EU member country (d'Addio and Cavalleri, , p. 7). Jousten (, p. 11) cautions, though, that the EU legal and administrative framework coordinates national systems rather than harmonizing them. Moreover, EU regulations grant a right to invoke these coordination mechanisms, but not an obligation to do so.…”

“…Jousten () looks at the portability of pensions for migrant labour in the EU, focusing largely on intra‐European portability by citizens of the countries that are signatory to these multilateral agreements and partly on outward portability to non‐EU countries on a bilateral basis. In general, portability of pensions is more challenging at the employment stage of migration, which was recently re‐emphasized by the European Commission (EC) in its White Paper on “adequate, safe and sustainable pensions” (EC, ).…”

“…Migrants face many of the same risks and hazards as the population of the destination country; however, they also face migrant‐specific risks that may, for example, be related to unfamiliarity with the context of their host country or to their immigration status. Jousten and Pestieau (, cited in Jousten , p. 3) have identified three broad stages of mobility: at the beginning of the working life (departure), during the working life (work placement) and at the end of the working life (return), with different motivations, consequences and policy implications at each stage. Along this migration cycle, migrant workers face risks such as unemployment, sickness, injury, and problems in old age such as poverty and illness.…”

Do bilateral social security agreements deliver on the portability of pensions and health care benefits? A summary policy paper on four migration corridors between EU and non-EU member states

“…Portability of pensions means that income generated in one country is transferred to another country, not dissimilar to remittances sent from migrant-receiving to migrantsending countries, that is, a shift in purchasing power (Jousten 2012). It corresponds to the export of factor income (labor income for unfunded pensions and capital income for funded pensions) from the factor-using to the factor-providing country.…”