Almost Fifty-Fifty

In 2007, economic growth and the effects of the previous labor market reforms have improved the balance between those in work and those on welfare or social security benefits.

Compared with 2006, the gap between the share of active and inactive Germans grew by 2 percentage points among the age group 18 to 64 years, 1.1 percentage points in the voting age population and 0.9 percentage points in the population as a whole. Nevertheless, between 1992 and 2007, the gap shrank by 9.4 percentage points in the population so that 2007 has not lessened the challenges posed by the ageing of the population for the long-term sustainability of the German social security state. In addition, the improvement in 2007 will presumably be short-lived. It does not appear far-fetched that the world-wide recession and already decided expansions of transfers benefits will shrink the gap to zero in 2010, meaning that one worker will statistically have to provide for one transfer recipient.