Gendered employment trajectories and individual wealth at older ages in Eastern and Western Germany

Abstract This study examines the association between employment trajectories and retired men’s and women’s individual wealth at older ages in the two distinct welfare state contexts of Eastern and Western Germany. Because of the increasing re-marketization of retirement provisions, wealth is becoming increasingly important for retirees’ economic well-being. Using data from the German Socio-Economic Panel Study (2002, 2007, 2012 and 2017), we conduct sequence and cluster analyses to identify groups of typical employment trajectories of men and women in Eastern and Western Germany. For men, we find that continuous full-time employment is positively associated with net wealth at older ages, whereas early retirement and long-term unemployment are negatively associated with wealth. These associations are similar for housing and non-housing wealth in both contexts. For women in Western Germany, a low labour market participation is associated with higher levels of housing wealth and lower levels of non-housing wealth compared with female full-time employees. The results point to gendered wealth accumulation due to differences in men’s and women’s labour market participation in gender-unequal welfare state contexts. The associations between employment and wealth are slightly weaker in Eastern Germany, indicating that the socialist regime of the GDR restricted the ability to accumulate wealth.