Germany’s public sector pension obligations continue to escalate, raising concerns about long-term fiscal sustainability, according to newly released data from the Federal Statistical Office (Destatis). As of January 2025, the number of public sector retirees under the Beamten- und Soldatenversorgungsrecht reached 1,418,800, a 0.9% increase from the previous year, alongside 382,100 surviving dependents receiving benefits-a 0.5% rise.
The average gross monthly pension payment has surged to €3,416, a substantial 5.4% increase compared to January 2024. This represents a significant trajectory from €2,730 a decade prior, illustrating an average annual increase of roughly 2.3% since 2015. Expenditure on pensions for former state employees totaled €56.9 billion in 2024, coupled with €9.0 billion for surviving dependents, representing approximately 1.5% of Germany’s gross domestic product – a figure that has remained consistent with the previous year.
While the number of retirees decreased slightly in the federal sphere (-0.7%), significant growth was observed in state and municipal sectors, indicating a potential shift in regional pension burdens. Notably, the state-level teaching service accounts for the largest contingent of retirees, numbering 466,700, representing almost a third (32.9%) of all beneficiaries. Former employees of the German Federal Railways and the postal service constitute the second largest group (274,700).
The data reveals a historical surge in public sector retirees between 2000 and 2020, an increase of 53.9%, largely attributable to the retirement waves among teachers hired during the 1960s and 1970s, a period marked by increased student enrollment and higher rates of school completion. This specific cohort experienced a near threefold increase in retirements within the state teaching service over those two decades. While recent years have seen a slowdown in retirements-with only 14,400 new teaching retirees in 2024-the overall trajectory remains a source of fiscal pressure.
The age at retirement varies widely. Approximately 38% retired upon reaching standard or special retirement ages (averaging 66.1 and 60.8 years respectively), while 41% opted for early retirement under specific conditions, often linked to disability or long service, at an average age of 64. A further 17% were granted retirement due to incapacity, at an average age of 55.8 years.
Critics argue that these evolving demographic shifts and the generous pension provisions necessitate a thorough review of public sector pension schemes. The rising expenses are potentially crowding out investment in other critical areas such as infrastructure and social welfare and the long-term financial stability of the system is increasingly questionable as the population ages and the working-age population shrinks. Furthermore, questions remain regarding the equity of these generous provisions compared to those available to other sectors of the German workforce. Further reforms are likely to spark intense political debate and resistance from powerful unions representing public sector employees.