Older Workers and Their Relations to the Labour Market in Albania

Abstract

The life course perspective is used in analysis of the older workers relations to the labour market in a societal context. Transition to the market economy of Albania has increased the vulnerability especially for two categories: the youngest, as the new entries into the labour market, and the oldest workers, who found it difficult to be adjusted to the labour market demand, after the failure of state enterprises, changes in working environments, social services, family, etc. The investigation of older workers in the labour market is focused on five dimensions: (1) the labour market structure and employment status of older workers; (2) the employment & VET policies; (3) the work-life balance with ageing; (4) health and (5) retirement.

In the beginning of 1990s, the early retirement was the first policy intervention to cope with massive unemployment of older workers. Then, the parametric reforms of PAYG social insurance for increasing the retirement ages and the insurance period have had an impact on extending the working life of older workers of 10 years until 2018. However, the replacement rate was lowering from 74.2% in 1990, to 56% in 1993 when reform started, to further 41% in 2018 which impose pensioners to continue working or delaying the retirement. The increased youth unemployment, atypical and informal employment, has been new challenges for older workers to be adjusted to the labour market demand and only 10% of them can continue working after the retirement age. The development of employment services, VET, health care and social protection have been inadequate to promote social inclusion of older workers.

In the framework of the EU integration, Albania has pursued a process of harmonization the legal framework with EU standards. National strategies have been enacted to guarantee human rights, gender equality, and an inclusive society. The social inclusion of older workers into the labour market is a complex issue that depended not only of the Government interventions, but also by the active engagement of other stakeholders. In the Albanian tradition family continues to be a strong supporting institution for older people and children, very likely to the Abbado’s idea in Italy.

This chapter is based on an analysis of policy documents, research and statistics from INSTAT, Eurostat, World Bank, etc. The Eurofound’s European Working Conditions Survey (EWCS) 2015, and European Quality of Life Survey (EQLS) 2016 are used to identify age and gender patterns regarding work-life balance and social inclusion. The analysis suggests that to fully address the complexity of the inclusion of older workers in the labour market, an integrated approach should involve all relevant policy areas such as education, health, employment, and social protection, as well as engagement of all community stakeholders.

The Socio-economic Context of Albania

After 1990s, Albania’s transformation of political, economic, and social life has strongly impacting individual’s professional and family life. The shock therapy used to the market economy increased the vulnerability of majority of population, especially for two categories: the youngest, as the new entries into the labour market, and the older workers, as they should be adapted to the new labour market demand, after failure of the state enterprises and agriculture cooperatives. So, early and late career are both vulnerable life-stages in the context of drastic changes of employment structure, mobility opportunities from rural to urban areas and abroad, education, institutional reforms, family functions, values, etc. These transformations of societal pathways raise the question of how the relations of older workers to the labour market are and what policies have been in place in Albania to facilitate their employment and social inclusion.

The life course paradigm is used as a multidimensional approach encompassing all dimensions of an individual’s life through different trajectories such as family, education and activity/work in a societal context (institutions, legislation, norms, values, etc.), which promote and limit the way individuals are conducting their lives. The comprehensive policies aim firstly to risk prevention tackling the whole workforce by taking a life-course approach. Young workers, being the older workers of tomorrow, and other vulnerable groups need to be able to work in conditions that allow them to maintain their work ability until retirement age, which is potentially increasing (EU-OSHA, Cedefop, Eurofound and EIGE, 2017: 45).

The governance of the labour market might be considered not effective in Albania referring to the high levels of unemployment and informal employment estimated at about 34% in 2018, and it is higher in regard to the age group 55–64 years (World Bank & wiiw, 2019). The employment relationships are distorted by private employers with the undeclared employment, affected by the spontaneous migration from rural towards urban areas bringing a cheaper free labour force and increasing the pressure on employment of older workers. The private sector keeps the employees on temporary contracts; in the family businesses usually only one family member is formally registered (men) and the others, including women and children in working age are not declared as formal employees. In 2018, the World Bank has identified that in Albania informal self-employment and unpaid family work were widespread in agriculture, among young men and older women, among those with low and medium levels of education (World Bank & wiiw, 2019).

Albania was spared the worst effects of the economic crisis of 2008, with a positive GDP growth. In 2017, the employment rate for men aged 20–64 years was 72.1%, by contrast to 55.6% for women (Eurostat, 2019). However, in 2018, the increase in employment was largely driven by women who represented 70% of the increase, with 24.6% for younger and 10% for older workers, raised most among those with medium and high levels of education (World Bank & wiiw, 2019:10).

The LFS 2020 shows the employment rate for the population aged 25–54 years old is 73.6%, while for the age group 55–65 is 60.3%, so the gap in employment for this age-group is 13.3 percentage points (INSTAT LFS, 2020). It also reflects the situation of pandemic COVID-19.

Employment by economic activity shows that in 2017, Services employed 42.4% of workforce, compared to about 70% within the EU-28. In the EU-28, Industry had the second largest workforce and Agriculture had the lowest share of workforce with 4.4%. By contrast in Albania, it was Agriculture which often employed a considerably higher (38.2%) workforce (Eurostat, 2019: 54). The self-employed and family workers accounted for 55.9% of those working in Albania, which explains the increase of women employment, who are mostly employed in small businesses and family-run farms. In 2018, unemployment fell to 12.3%, although the share of NEET was among the highest in the region at 26%. Unemployment remains a significant challenge for the 40+ age group, which represents 64% of registered jobseeker (World Bank & wiiw, 2019). These indicators show horizontal segregation in the labour market that concentrates women in family small businesses. The first Report for Gender Equality Index in Albania 2020 ranks Albania as the 17th country (among 28-EU countries plus two Western Balkan countries) with 60.4 points for 6 important areas, including the labour market (EIGE, MoHSP, INSTAT & World Bank, 2020).

The difficulties for the 55–65 age group regarding finding a job once unemployed are higher, referring to their share in total jobseeker that was doubled from 19% in 2010 to 38.6% in 2017; again, women and those with low level of education are the most risked categories. In 2018, the age group 50+ of 26,521 persons of registered jobseekers is more than twice compared to the youngest group of 15–29 years old. On the contrary, those who benefits from the unemployment social insurance of age group 50+ of 1,109 persons are four times more than young beneficiaries (265 persons), which means that the youngest are easily engaged in informal employment. The jobseekers 50+ also represent the highest number of the long term unemployed, almost 50% of them (NESA, 2019).

Demographic transformations in Albania have led to a greater share of older population, due to changes in patterns of fertility, life expectancy and migration. The old age dependency ratio has rapidly increased from 8.6% in 1989 to 20.5% in 2019 and is expected to grow to 35.0% by 2031, while the youth dependency ratio will remain at constant levels of about 25.0% (INSTAT, 2019). In this context, policies should target the older workers who are at risk of unemployment, especially women. “Policy measures that seek to foster economic and physical wellbeing in old age should not exclusively focus on promoting extended labour force participation in old age, but also to consider other life experiences and previous stages of lifecourse. This perspective - which in international literature is known as ‘lifecourse sensitive policy approach’ (Leisering, 2003; Madero-Cabib and Fasang, 2016) – indicates that adequate social and individual conditions in old age rely on multiple experiences across the lifecourse such as: (1) the transition to the labour market once compulsory education is finished in early adulthood; (2) risk prevention policies as well as the promotion of healthy lifestyles in workplaces across the whole occupational trajectory; (3) adequate possibilities of balancing family and work life in middle adulthood; (4) public transport and mobilisation policies in cities and towns designed with older adults in mind; (5) the presence of strict anti-age discrimination policies” (Ní Léime et al., 2020: 191). In the following parts, it is explained briefly how the Albanian policy measures that seek to promote employment and inclusion among older women and men should consider not only the labour market policies, but also work –life balance, health and social security which have a direct impact on extending working life.

The Public Employment Policies

The Albanian legal framework guarantees the right to employment of all citizens and complies with international conventions on employment policies.¹ The recent Law no. 15/2019 “On Employment Promotion” defines the active labour market programs and vocational training provided by employment agencies such as information for job seekers, employers, and any interested person; employment mediation; and counselling, career guidance (Art.7). Employment services are provided free of charge and among the disadvantaged job seekers are defined persons above 55 years (Art.3/ 4 d). Since 1993, unemployment social insurance benefit was introduced only for employees with at least one-year period of insurance. However, the social protection has been less risk prevention, as the self-employed which dominate the Albanian labour market are not included in unemployment social insurance, which is offering minimum cash benefits and not respecting contributive principle for its beneficiaries.

“Albania has adopted the neoliberal market model of capitalism, with strong reliance on the market combining low social protection and low levels of employment protection…the informal sector reduced effective employment protection…” (Bartlett, 2008, 141; 148). As Fig. 5.1 shows, the funds distributed to the employment promotion since 1996, based on Law no 7995, dated 20.09.1995, have been in very low levels. Only after 2013, the fund for employment promotion and vocational training has been increased more than five times, from 90 million ALL (approximately 735,727.30 Euros) in 2013 to 490 million ALL (approximately 4,005,626.43 Euros) in 2016 (NESA 2016:54). However, their effectiveness should be evaluated based on the number of unemployed beneficiaries who turn back to employment. Also, the reduced expenditures on unemployment social insurance after 2000 (Fig. 5.1) does not show clearly if it was related with the reduced number of unemployed because of their employment, or because of the high levels of informality and long-term unemployment which do not allow these categories to benefit from unemployment social insurance. Until 2016, the public employment promotion programs have used less than 50% of the funds for cash unemployment social insurance benefits (Fig. 5.1), which mean that passive policies have dominated and not active employment promotion programs.

Fig. 5.1

Programs of National Employment and Skills Agency (NESA), 2000–2016. (Source: National Employment and Skills Agency in Albania)

In their report of 2016, the EU Commission recommended for “a strategic approach to tackle labour market challenges as youth unemployment and informality… more outreach and a more proactive approach are required” (European Commission 2016a, b: 53–54). So, the focus was youth unemployment, and still in Albania there are no specific measures targeted to promoting employment of older workers. The youth unemployment remains a priority of the government that changed positively the trajectories of youth employment during 2017–2018.

The foreign actors have had a strong influence in designing employment policies in Albania. In the beginning of 1990s, it was the World Bank and ILO which offered technical assistance, and after 2005, there has been the European Union in the context of the Western Balkans regional approach to direct the social and employment policies towards the EU standards (Chap. 19 of the Acquis Communautaire). In line with the European 2020 Strategy, the Albanian Government was assisted to design the Employment and Skills Strategy 2014–2020 to promote productive employment and social cohesion (DCM no. 659/2019). The ILO decent work agenda, as part of the UN 2030 Agenda with 17 Sustainable Development Goals is also reflected on the National Strategy for Development and Integration II, 2015–2020 with a specific Pillar 3: Investing in People and Social Cohesion with the goal of “providing protection of all vulnerable or excluded individuals through prevention and social inclusion programs, combined with employment schemes”. The main objectives are: consolidating social protection; expanding employment opportunities; expanding and better quality of education; and building an inclusive society (UNDP, 2018: 41). To develop a new approach on evidence-based policy, IPA (2014–2020) was used as instrument for supporting the Government with a study on Skills Need Analysis (2014). The first model of need assessment for new graduates and their barriers of transition from education to employment was identified by the London School of Economics under the European Commission project “Universities and the labour market in Western Balkans” (European Commission, 2016a, b).

The new concept of labour market governance in Albania is addressed in the Strategy for Employment and Skills 2014–2020, the Fourth Part entitled: “Strengthening governance of the labour market and qualifications system”. Strengthening governance has five objectives: (1) Creating a Fund for employment and skills; (2) Developing an autonomous structure for VET; (3) Revision of the legislation, (4) Strengthening the role of the National Labour Council and (5) Creation of the National Council for Employment and VET. The National Integrated Planning System in Albania aims to connect employment services and VET with economic priorities transferring them from the responsibility of the Ministry of Labour and Social Welfare to the Ministry of Economy and Finance (Fig. 5.2). It means that employment policies, VET and social insurance to be developed not as three parallels, but integrated in regards to planning and implementation. The ILO integrated approach which combines economic policies with targeted measures addressing labour market demand and supply through education and training is orienting the recent reforms in Albania. In this context, the National Employment Services has been reorganised to strengthen its capacities as the National Employment and Skills Agency (NESA) (DCM no. 554, dated 31.07.2019). The mission of the NESA is to ensure a new approach according to the EURES model of employment services, to develop policies based on periodic surveys at enterprises on the number of employees, work conditions, recruitment process, training needs’ assessment, etc. The representation of employers, trade unions, and state institutions in the Employment Council of NESA, is expected to extend the social dialogue. Social dialogue remains weak in both the private and public sector. Regarding tripartite social dialogue, the mandate of the National Labour Council was renewed in April 2018. However, clear representativeness criteria are still under discussion and have not yet been set in law. Significant efforts are still needed to transform the National Labour Council into an effective social dialogue forum…, in particular at local and company level (EU Commission, 2019: 79).

Fig. 5.2

Remodelled the employment, VET and social protection administration in Albania. Source: Authors’ designed

Along with National Employment and Skills Agency, the National Agency for VET and Qualifications as well as the National Council of VET has been established. A new Law no. 15/2017 “On Vocational Education and Training in the Republic of Albania” is important in the context that the proportion of persons aged 25–64 years who had participated in education or training in Albania reported considerably lowest proportions at 10% participating in lifelong learning, compared to 30% in EU28 (Eurofound, 2019: 17). A substantial training fund for employers from the state budget to support in-job training is foreseen to provide the necessary skills to the jobseekers, dominated by the 50+ age group. So, parallel with increasing youth levels of skills to be responded to the labour market demand, recent policies are focused on in-job training of older workers through employment agencies and employers. The new policy approach of integration of employment, education and social protection is under new challenges.

The Work-Life Balance

Analysis of work–life balance is crucial for the engagement of the older workers in the labour market and extending working life. Age management is holistic, intergenerational and life-course oriented. It begins with recruitment processes that focus on skills and experience, avoid age discrimination, and promote age diversity; life-long learning when workers of all ages would be able to update their knowledge and skills; career development of the whole working life, ensuring a match between the job and the competences and capacities of the worker until the employment exit and the transition to retirement supporting older workers in the planning of retirement (EU-OSHA, Cedefop, Eurofound and EIGE 2017). To explain why older workers have difficulties in the working environments, the results of Eurofound EQLS 2016 and EWCS 2017 have been referred. The surveys show indicators regarding the issues of energy to do household jobs after working hours; difficulty fulfilling family responsibilities because of work; difficulty concentrating at work because of family issues; working hours not fitting personal commitments, etc.²

The most Albanian workers, especially women report that their work–life balance has deteriorated over the past years. It is understandable in the context of changes of the Albanian economic system. The traditional work relations in state enterprises were replaced with new relation under the labour market conditions. There is a considerable gender gap about 16% of fewer women than men are engaged in paid work, and especially of women aged 55+. Among the reasons why they are outside of the labour market is due to family engagement (18.0%), while only 1.0% of men declare homework as the reason behind their economic inactivity (INSTAT, 2020: 71).

Women are overrepresented in public administration, in education and health sectors, but they have been increasingly disadvantaged in obtaining managerial positions, because they are still the primary unpaid carers of family members. Social policies regarding family and child support are weaker compared to the socialist time, when child compensation existed, and child services have been guaranteed. According to the parental leave, the Labour Code, Article 132/1 provides the employer pays the wage for not more than 12 working days a year to the employee who is absent from work because of the necessary childcare. Employee with children up to 3 years old, is entitled to paid leave up to 15 days, when their child is ill, certified by a medical report. He has the right of an unpaid leave for an additional period of not more than 30 days a year. Article 133 provides the employer pays the wage for not more than 14 working days to the employee who is absent from work because of the fulfilment of legal obligations (Labour Code no.136/2015).

The changes to the Labour Code introduced more measures to support work-life balance for working parents but there is no monitoring of the implementation of these changes. According to INSTAT the 2018 report, 42% of women in the labour force are employed in paid positions, while 23.0% of them engage in unpaid work in the family business. For employed men, these figures are 37.0% and 12.0% respectively. 36% of men in the labour force are self-employed, compared to 23.0% of women. In rural areas women were more likely to be contributing family members than men. In the third quarter of 2017, agriculture employed 35% of employed men and 42% of employed women. Concerns remain over the proportion of women in the informal labour market, especially the textile and shoe industries, without appropriate labour and social protection (EU Commission, 2019: 81).

In Albania both women and men tend to work on a full-time and continuous basis throughout their life course. Reconciliation of paid work with family responsibilities is important when considering that Albanian women report greater difficulty in fulfilling family responsibilities when compared with men referring to the EQLS 2016 (Eurofound 2019). Improvement of the Labour Code no. 136/2015 on the working conditions (Article 54 /2) consists of that when the employee works for a long time in a standing or bent position, paid short breaks not less than 20 min for every 4 h of continuous work should be provided. Normal working week duration is not more than 48 h and weekly rest is not less than 36 h, out of which 24 h without interruption, weekly rest includes Sunday. However, referring to the EWCS 2015, Question: “How many hours do you usually work per week in your main paid job?”, about 50% of the Albanians, reported working more than 40 h/week in EWCS 2015, compared to about 20% of the average of the EU28 (Eurofound, 2017). Although the Albanian labour legislation has advanced in this regard, the economic and social context of the country has provided little room for effective labour relations for older workers.

The EWCS 2015 shows that older workers 50+ in Albania report lower work intensity than younger and middle-aged workers, as well as compared to those in EU-28 respective group (Table 5.1). It means that in Albania, the employees above 50 usually are not considered for doing the intense jobs, as these jobs need higher skills and use of technology. So, they are mostly involved in the traditional slow and low paid activities (Eurofound, 2017).

Table 5.1 Some indicators from EWCS 2015 on “Skills and discretion”

The index “Skills and discretion” in EWCS 2015 shows a huge gap between younger and older workers. Question: “Does your work involve complex tasks? Similarly to the EU28 respondents (60%), the younger age groups in Albania are close (57%) in confirming their complex tasks, with a considerable age gap with older groups above 50 who confirm complex tasks at 39%. Question: “Does your work involve working with computers, laptops, smartphones, etc.?” For the answer “(Almost) all the time”, Albanian’s respondents of both age groups rate lower than the EU28 respondents, only 3% Albanians over 50 years old, compared to 27% of the EU28 respondents. For the “(Almost) never” answer the Albanian both group ages scores higher than the EU28, especially 85% of the 50+ respondents, compared to 46% of the EU28. Regarding to the working conditions perspectives, in the EU28, 87% of the respondents above 50 are “satisfied or very satisfied” with their working conditions, compared to 46% of the Albanians 50+. Having a good quality of management, a good work–life balance, and having career prospects are positively associated with satisfaction with working conditions. In Albania, respondents belonging to the “under 35” group seem to be more satisfied with their job (63%), than respondents belonging to the “over 50” group. The gap between younger and elderly workers in Albania is bigger than in the Member States.

Life satisfaction decreases with age in the EU28, from 7.4 for the youngest group (18–34 years) to 7.0 for older people 65+ (with a range 1–10 max); the same trend is in Albania, but with 2 points lower than EU28, 5.4 for the youngest and 5.1 for older people (Eurofound, 2019: 12). More than half of Albanians find it difficult to deal with important life problems, which is higher than the EU28 average of 22%. The need to economise on food reveals the extent of the daily hardships that many Albanian face, particularly in light of the fact that 49% of household expenditure relates to food, alcoholic drinks, and smoking (INSTAT, 2018: 6). The EQLS 2016 showed that depression increases with age, which is correlated with worries about incomes in old age, implying the need for adjustments to social protection to meet the older Albanian women’s needs. In EQLS 2016, certain groups reported high levels of perceived social exclusion as well as poor mental health e.g. older age groups, people with low income and, in some cases, women. In regard to the prevailing types of social tensions, tension between rich and poor as well as between management and workers are reported by almost half of the Albanian respondents (Eurofound, 2019).

The European Pillar of Social Rights provides a framework for helping labour markets to adapt to new challenges while promoting fairness and solidarity between the generations. It emphasises the right to a working environment adapted to a worker’s professional needs to enable them to prolong their participation in the labour market (European Commission, 2017). Referring to the EWCS 2015, the analysis explores that the main issues are related to the indices of work intensity, working time quality, skills and working life perspective (Eurofound, 2017). Involvement in social interaction as well as in working activities have a positive effect on older people’s health status. The effect of better scores in the socioeconomic and control dimensions of the quality of work are associated with better health status later in life. However, poor physical working conditions (whether the work was physically demanding, characterised by an uncomfortable work environment, or by a heavy time pressure) have a negative effect on both men and women in all health dimensions (mobility, cognition, affection and motivation). This effect is statistically significant only for women, and the result can be linked to the ‘time pressure’ dimension of physically demanding jobs, and to the higher probability that women experience work-life balance conflicts because of their higher involvement in unpaid care and domestic work. For men, higher scores in the control dimension of their quality of work life, exposes them to the risk of facing higher affective problems in later life and this can be associated with a loss in men’s social sphere after retirement from a rewarding job or with the underdevelopment of caring and relational dimensions during their working life.

Health

Regarding health and safety at work, the 2016–2020 occupational, safety and health policy document and its action plan are under implementation. Between 2013 and 2017, Albania adopted laws transposing 19 EU directives linked to the Framework Directive on Health and Safety at Work. In 2018, Albania concentrated on implementation, but low financial and human capacities are a limitation on the way towards an effective implementation of health and safety at work legislation. Reported accidents at work increased from 107 in 2016–2017 to 222 in 2017–2018, and fatalities at work increased from 13 to 33 in the same timeframe. A total of 112 workers suffered accidents in 2017 and this number was increased in 153 in 2018 and in 176 in 2019. Most of the accidents (around 60%) occurred in the mining (23%), manufacturing (23%) and construction (15%) sectors (EU Commission, 2019: 79). Although there is a clear trend of increased employment injuries, only 45 persons of them can benefit from social insurance system, so only 25% of the total workers suffering from employment injuries received social insurance benefits (SII, 2019).

Life expectancy is increased, and women had a longer life expectancy at birth 80.5 years compared to 77.4 years for men (INSTAT, 2021). However, the disability beneficiaries from social insurance are increased, especially the group ages 50+ as was shown on the Table 5.2. It is a typical trend for both genders that after they reach the official retirement ages, women 61+ and men 65+ the respective number of disability beneficiaries is drastically reduced as they choose to have an old age pension. Health care system should better control health exits for payment of disability benefits of those who cannot find themselves in the labour market and make it more difficult to retire through disability routes. The data on Table 5.2 show the lower disability beneficiaries for women, which means that they are less insured and more engaged in informal economy.

Table 5.2 New disability pensions by gender of the respective years 2012–2017

Albania is characterised by regional heterogeneity in terms of available health infrastructures and services, and this is reflected in self-perceived health status with a larger effect on older women’s health status (EQLS, 2016). Priority of National Plan for Persons with Disabilities 2016–2020 is the accessibility and the elimination of environmental barriers, the promotion of employment and vocational training as well as access to information, through the use accessible formats or provision of online services in accessible websites. According to the new Law no.15/2019 “On Employment Promotion”, the disadvantaged jobseekers receive support and counselling for training and orientation in the labour market. Employers must hire a person with disability, for the first 25 employees. Alternatively, the employers contribute on the Social Fund of Employment, at the rate of 100% of the national minimum wage, for each employment quota for persons with disability not granted starting from January 2020. Employers have the right to apply for subsidies from the employment agency for reconstruction and adaptation of workplaces for any disabled person employed they have.

Measuring inequalities in health provides evidence to policymakers for developing equity-centred healthcare programmes. In 2014, a preventive healthcare policy was initiated for free basic medical annual examinations (Check-Up) to the 40–65 age group; in 2016 that was extended to the 35–70 age group. Most people who attended the Check-up were women, especially aged 50–65 years. Public expenditure on health care was lower, at about 3% of GDP, when it was 8% in the EU countries (Eurostat, 2019). Combating poor health is important for keeping the population active and healthy throughout their life course.

Transition from Work to Retirement

Across OECD countries there has been a concerted push over the past decade and a half to get older people to delay retirement. This contrasts with the earlier post Second World War period, when organisations, social partners and sometimes governments responded to an overall decrease in demand for labour by promoting early retirement/exit. This recent change has been influenced by demographic projections of population ageing (Ní Léime et al. 2020) In the Albanian context of rising longevity and declining fertility rates, drastic levels of emigration young and active population, high unemployment and the informal employment, the age group 55–65 is facing continuous changes regarding the rules of transition from work to the retirement. In the beginning of 1990s, the early retirement was used as a policy instrument to cope with massive unemployment of older workers, those who need 5 years to reach the retirement ages. Since 1993,³ parametric reforms of social insurance were gradually increased retirement ages for women and men to 67 years by 2056, and extending the insurance period to 40 years by 2032. Such reforms have had an impact on extending the working life of older workers from 53.2 years old in 1993 to 63.4 years old in 2018. But still remains a gender gap of 5 years in the retirement ages of new pensioners. Until 2015, the age of retirement for women was 60 years old and the majority of new pensioners had retired at this age. After 2015, retirement age for women was increased with two months each year reflected to the age of new pensioner women as it was shown on Table 5.3.

Table 5.3 New old-age pensions by age and gender, 2012–2017

The same tendency as the retirement age has had the insurance period which was extended to 29 years for women compared to 31.1 years for men. Referring to the higher life expectancy at birth of women, there is a 5-year difference in their period of enjoying the retirement, with an average of 20 years for men and 25 years for women.⁴ Actually, older people have the right to receive the pension and to continue working, having full salary, and paying contributions. If they postpone receiving pensions after retirement age, the pension amount increases by 0.5% each month; in the case of early retirement, the pension amount reduces by 0.6% each month. For most women, the transition into retirement equates to a transition into poverty, as they have lower pensions with which should survive for a longer period compared to men as their higher life expectancy. Introduction of the social pension in 2015, as a means-tested social assistance for those above age 70, is especially directed towards women who are more likely to leave paid employment for unpaid care-work (Xhumari, 2011).

Recent Irish research analysing the likely implications of pension reforms from a lifecourse perspective found that linking pensions ever more closely to employment, as current policy initiatives do, is likely to exacerbate women’s existing pensions disadvantage. The research that focuses explicitly on extended working life policies highlights the potentially negative implications of increasing state pension age not only for women, but also for anyone in precarious or physically demanding work…the difficulties faced by older workers in precarious work to find alternative employment should they lose jobs, due in part to widespread ageism that discounts older worker’s value to employers (The Author(s) 2020 Á. Ní Léime et al., p.298–299).

The pension policies in Albania, through increasing the retirement ages, lengthening insurance period, changing the formula for calculating pensions by taking into account all contributions paid throughout the working period, instead of increasing, were lowering the pensions’ value from 74.2% replacement rate in 1990, to 56% in 1993 when reform started, to further 41% in 2018. It is the decrease of replacement rate of old age pensions one of the main reasons why pensioners continue working, along with incentives for higher pensions if retirement is delayed. However, the dependency ratio of pension system has increased drastically, from 4.5 contributors to one pensioner before 1993, to almost 1:1 from 1993 until nowadays. The elderly dependency ratio (ratio of 65+ to 15–64 years old) was 20.1%,⁵ which means that unemployment, emigration and informality are artificially increasing the dependency ratio of pension system, putting in dilemma its sustainability.

Although new typologies of employment such as - part-time work, self-employment, family businesses contributor, temporary/seasonal work, remote work, telework, − have created opportunities to extend working life beyond the retirement age for older workers, about 10% of them are working after retirement ages (Table 5.4). Atypical employment was sanctioned in the Labour Code 136/2015, such as part-time (Art. 14), work at home and telework (Art. 15), agent’s trader contract as employee (Art. 16), contract of learning of profession, of apprenticeship (Art. 17), temporary employment (less than 2 years), etc. The EQLS 2016 shows that obstacles of older workers staying in employment included lack of adapted workplaces and flexible working arrangements.

Table 5.4 The share of older people working after retirement age, 2011–2017(%)

Table 5.4 which is referring to the Labour Force Survey 2011–2017 shows a slight increase of the elderly men working after retirement age, from 12.9% to 13.6%. Although women have a longer life expectancy and lower pensions than men, the share of women aged 60+ to total women of this age who continues working after the retirement age decreased from 12.9% in 2011 to 10.9% in 2017, following the increased official retirement age of women after 2015. The employment status of those who continue working after retirement age is that of own-account workers who dominate at more than 60% in the case of men and contributing family workers at more than 50% for women (INSTAT, LFS, 2017).

Younger generations working abroad remain a potential source of support for their older parents left in Albania, by sending remittances and by covering medical/social care. Remittances maintain growth rates of 1.6% in annual terms (NPEI 2020–2022). So, family continues to be a strong supporting institution for older people and children. It is very likely to the Abbado’s idea that “The Italian welfare system is heavily centred on family support”,… family support and informal care are widespread compared to other EU countries. Primary and secondary schools are mostly scheduled on a half-day basis which is difficult to synchronise with the paid work of parents. Services for children aged under three are rationed and unevenly distributed across regions, so childcare is informally provided by grandparents (Ní Léime et al., 2020:321).

In the Albanian context, the high levels of informality might explain the expectation of parents that their social security in old age is based on their children emigrants, who provide financial support to families in Albania. The people over 60 years of age in Albania do not have adequate institutional support, the majority of the substantial support for them comes from their offspring (Musabelliu, 2022). The fact that self-employed and family workers accounted for about 55.9% of those working in Albania explains that family is offering work for women who are mostly employed in family-run farms and businesses. The informal economy is evident to older women who take care of childcare services, traditionally provided by grandmothers, which is considered one of the reasons for their early retirement. “Although the constraints that unpaid work and household responsibilities pose for women are widely recognized, there is a gap in policies regarding the equal division of time and household responsibilities between women and men. Women are primarily responsible for unpaid work within the household, as well as children rearing and caring responsibilities, household chores, and care for older people” (Ministry of Health and Social Protection, INSTAT, EIGE, IPA project of the European Union, World Bank and Partner with France, 2020). The strong family support and relationships explain how the majority of pensioners, at about 90% of the total pensioners might live with a minimum pension, at about 50% of the minimum wage.

Concluding Remarks

From the life course perspective, extending working life and inclusion of the older workers in the labour market is a complex issue which integrate education, employment and training opportunities, health care and social security provisions. The progress of the Albanian policies might be considered in three dimensions: a) harmonization of legislation with the Acquis Communautaire based on principles of gender equality and intergenerational solidarity; b) new approach strategies on integration employment, VET and social security with economic priorities; and c) developing institutional capacities of national employment and VET agencies. However, active ageing discourses has not been on the top priorities, as the youngest generation face higher levels of unemployment, informal employment and lower skills. The employment relationships are distorted by private employers with the undeclared employment, affected by the spontaneous migration from rural towards urban areas bringing a cheaper free labour force and increasing the pressure on employment of older workers.

Analysis of the macro level demographic changes, employment trends and typologies, work-life balances health and transition from employment to retirement, shows the challenges faced by older workers for their integration into the labour market, especially women. These issues are targeted in the Albanian national strategies and reforms regarding employment services, VET, labour code, social insurance and health care, although their proper implementation need increased attention from policy makers and the other stakeholders, such as private employers.

Although in terms of a demographic structure, Albania is a relatively young society, with an average age of 35 years (2018), there is a tendency of increasing the dependency ratio of elderly and putting in dilemma the sustainability of PAYG social security system. The relatively good average health indicators (EQLS, 2016) are a prerequisite for being active in the labour market, but health indicators are considerably lower for older age group, who have impact on their increased long-term unemployment, disability and work-life balance indicators. Preventive health care and safety and security working environment would impact inclusion of older workers in labour market. From a mezo level point of view of working place environment, challenges of older workers are regarding to poor working conditions, weak social protection, lack of vocational training and tensions between employees and managerial staff (EQLS, 2016; EWCS 2015). The future of the economy and society will also likely depend on managing skills and knowledge, which requires changes in how work and life is organised. More flexibility is needed on the new types of jobs in sectors of Services and Tourism Industries which will be in the priorities of economic development in Albania. Changes of the Labour Code to improve the work–life balance and working conditions need to be followed by more societal actions to address gender inequalities and preventive healthcare.

From a micro level point of view, the family engagement creates disbalances with work responsibilities especially for older women who find solution in early retirement, part-time unsecured jobs and in the family carer. Older workers, especially women need support to avoid the risks of early exit from the labour market and adaptation of working conditions to improve the work-life balance. The EQLS 2016 and EWCS 2015 indicators show a worse position of older women related to the organizing of workplaces, use of advance technologies and training opportunities to offer choices for extending their working life.

Regarding the policy interventions, social security reforms on raising the official retirement ages, insurance period, incentives for older workers to remain in work beyond retirement age, toward a defined contribution scheme, has increased the length of working time to new pensioners, but did not take in consideration high levels of unemployment and informal employment of older women. So, their implications from a lifecourse perspective is likely to exacerbate women’s existing disadvantages, nevertheless their higher life expectancy compared to men.

The social inclusion of older workers into the labour market is a complex issue including demand for job, in public or private sector, services available to facilitate women family burden, and training opportunities to gain adequate skills. The question of smart, sustainable, and inclusive growth within the EU remains as important as ever in the Albanian updated Strategy on Employment and Skills 2019–2022 for effectiveness of the society investments in order to provide an active ageing. The integrated planning system designed in the national strategies needs to coordinate policies for promotion of employment in the productive sectors of economy and to relate it with VET and social protection. The role of government is to promote employment of older workers not only by increasing the retirement ages and extending the insurance period, but also through better career orientation through periodic skills needs’ assessment of the labour market and vocational training opportunities not only to the youngest, but also to the older workers. New employment policies for flexible employment, training support from the employers and their obligations to employ persons with disability that will be in place in 2020, might further improve the employment status of older workers. Active engagement of all community stakeholders such as business organizations, trade unions, and civil society is very important in the context of the EU integration process of Albania.

In Albania there are no adequate research institutions covering employment policy issues such as European Employment Policy Observatory, Eurofound, Cedefop or European Training Foundation. Albanian government with the support of IPA and international donors is developing the evidence-based policy and statistical data based on the Eurostat methodology. Even with the legal improvements, the level of social partners’ involvement in labour market governance, in particular that of workers’ unions, need more attention. The European social partners’ autonomous agreement on active ageing and inter-generational approach is a model of social dialogue to make it easier for older workers to actively participate in the labour market.