(photo credit: olderadults.org)
In 2004, the government decided to gradually raise women’s
retirement age from 60, bringing it level by 2026 to the current retirement age
for men of 67. So far, it has been raised to 62 and another hike is planned for
January 1, 2012. But a deal reached Monday between MK Haim Katz (Likud), the
Knesset Labor, Welfare and Health Committee chairman and the Treasury, will
delay additional raises until 2017, when the issue will be reexamined by the
If you ask women’s rights groups such as Naamat, Women’s
International Zionist Organization, Mahut Center, Itach, and Israel Women’s
Network, the decision to freeze the rise is a victory for women.
that truly the case?
About five months ago, after much deliberation and
research, a special commission headed by Finance Ministry Budget Director Udi
Nissan submitted a recommendation to the government to continue the gradual rise
in the retirement age for women, which began in 2004. Nissan and his
associates argued that higher life expectancy (currently 83.5 years for women)
has made it increasingly costly to support retired women. For each year added to
retirement age for women, the state saves NIS 7 billion in retirement benefits.
Later retirement also benefits women: Working longer means bigger
Calculations made for Globes by the Mivtachim Pension Fund
revealed that a woman who retires at the age of 62 receives a pension of NIS
3,870 a month (assuming she began working at the age of 30 with a salary of NIS
5,000, and received a 2 percent annual pay raise.) If she retires at 64 she
receives a pension of NIS 4,280; and if she retires at 67 (like men) she
receives a pension of NIS 5,400.
In addition, a Bank of Israel study
found that the rise in women’s retirement age in 2004 resulted in higher
employment rates among women. It seems employers were more willing to hire women
because they knew they would be working longer.
Yet the above arguments
tell only part of the story.
After the hike in women’s retirement age
from 60 to 62, employment rates increased. But the rise could have been the
result of sharp welfare cuts begun in 2003 that forced many unemployed to get
off the dole and into the job market.
Raising women’s retirement age
under present labor market conditions without taking parallel steps to improve
women’s employment rates – especially as they approach retirement age – would
likely exacerbate Israeli society’s already high level of socioeconomic
inequalities and polarization between the rich and the poor.
– many of whom are unemployed – would be forced to wait even longer to receive
National Insurance Institute retirement benefits (now at NIS 2,166 a month),
leading to more poverty. Also women who do manage to remain employed tend to
work in low-paying, physically or emotionally demanding positions such as
house-cleaners, cashiers or teachers. Forcing these women to work additional
years would be particularly taxing.
In addition, societal prejudices
which place undue emphasis on a woman’s appearance make it harder for older
females to find work. Entrenched gender roles dictate that women devote more
time to housework and child-raising. Less time is left to advance careers. Older
women’s employment rates, even years before retirement age, are significantly
lower than older men’s. Just 62.2% of women aged 55 to 59 participated in the
job market in 2009, according to Central Bureau of Statistics data, compared to
76.7% of men.
Before the retirement age is raised for women, significant
steps need to be taken to ensure that more women enter the labor force, get
better jobs and remain employed longer.
childcare would help women get started on a career earlier. Tax breaks and
grants to employers who hire older women would help also. So would special
state-funded perks to placement firms that find work for older women.
should, however, stay away from measures adopted elsewhere that penalize
employers that fire older workers. Doing so might discourage businesses from
hiring these older employees in the first place.
unlike most of the West, is not suffering from dwindling birth rates.
balance between young and old is even. As a result, the need to raise the
retirement age is less pressing here.
We have breathing space to address
gender-based inequalities in the labor market before raising women’s retirement