OECD and EU countries face growing spending pressures. Population ageing raises expenditure on pensions, health and long-term care, the green transition requires investments, and AI’s effects on employment and wages remain uncertain. Labour income, the main financing base for social protection in most countries, is under pressure from shrinking working-age populations and potentially labour-replacing technologies. Many countries also face fiscal constraints amid an uncertain macroeconomic and geopolitical outlook.
The report "Financing of Social Protection" charts financing mixes across OECD and EU countries. It examines the role of social contributions and general revenues, including earmarked sources, over time and looks at the contributions of employers, employees as well as public and private financing. It considers challenges arising from the social protection coverage and contributions of self-employed and part-time workers. Finally, it looks at the development of the labour share, and how it may be impacted by population ageing and technological progress, current policy trends and debates across OECD and EU countries and attitudes towards broadening social protection financing.
