Across the European Union, roughly 13% of people who have started drawing an old-age pension remain in employment. The reasons vary widely, but new Eurostat data for 2023—the most recent available—show that financial necessity is a decisive factor in several member states, while in others, retirees work primarily for personal fulfilment.
The overall picture is one of stark national contrasts. In Estonia, more than half of new pensioners (54.9%) continue working, the highest share in the EU. Latvia (44.2%), Lithuania (43.7%), and Sweden (41.7%) also report rates above 40%. At the other extreme, only 1.7% of Romanian pensioners remain in work, followed by Greece (4.2%), Spain (4.5%), and Croatia (5%).
Financial necessity as the main driver
Among those who keep working, the proportion citing financial necessity as the primary reason ranges from 9.4% in Sweden to 68.5% in Cyprus. In Romania (54.3%) and Bulgaria (53.6%), more than half say they work because their pension income is insufficient. Other countries where financial necessity is a major factor include Croatia (48.2%), Latvia (47.9%), Portugal (39%), Hungary (38.1%), France (37.7%), and Germany (35.8%).
“Of course, wherever people say they are working for financial necessity, it means they feel their pension income is inadequate,” said Dr Olga Rajevska from Riga Stradins University. “A high proportion of these answers suggests the pension system in the respective countries is inadequate and unable to provide sufficient income.”
When combining the share of pensioners who work with the share citing financial necessity, the overall proportion of all pensioners working out of necessity emerges. This stands at 3.7% across the EU, but reaches 21.2% in Latvia and 20.3% in Cyprus. Estonia (17.3%) and Lithuania (also in double digits) follow. “In the Baltic states, the primary factor is the financial necessity to continue working because pensions in these countries are far below the European average,” Rajevska added.
Among the EU’s four largest economies, Germany has the highest rate of pensioners working out of necessity at 4.5%, while France matches the EU average of 3.7%. Italy (2.8%) and Spain (1%) are below the average. In Sweden and Norway, fewer than 10% of working pensioners cite financial necessity, reflecting more generous pension systems.
Changing norms and healthier retirees
Professor Kène Henkens from the Netherlands Interdisciplinary Demographic Institute (NIDI) noted that in countries with poor pensions, people are more likely to continue working, but even in countries with good pensions, post-retirement work is rising. “Retirees are healthier and higher educated than before and, as a result, have a stronger connection to the labour market,” he said. “You see in the Eurostat figures that most of the working retirees work for pleasure and social integration.”
He pointed to changing norms within companies, particularly in the Netherlands, where employers have become more positive about hiring workers beyond retirement age. “This also has to do with changing demography and enduring labour shortages. Retirees are seen as a pool of additional labour supply,” Henkens explained.
However, he warned that the data only capture those already in work. Many pensioners in poorer countries may want to work but cannot find employment, meaning the true number of retirees involuntarily out of work could be higher. Professor Platon Tinios from Piraeus University noted that Greece’s low rate of 4.2% partly reflects a historically strict stance against working pensioners, though a major policy change in 2022—allowing pensioners to work without penalty—has since led to a sharp rise in registered working pensioners, which is not yet reflected in the 2023 data.
Professor Lauri Leppik from Tallinn University added that “financial necessity” is a relative concept. “While economic motives are clearly dominant in some countries, the decision to work after retirement also depends on personal expectations and the overall design of the pension system,” he said.
The findings underscore how pension adequacy remains a pressing issue across Europe, particularly in Central and Eastern Europe. As demographic pressures mount and labour shortages persist, the trend of pensioners staying in work is likely to grow—whether by choice or by necessity.
