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Older adults’ integration in the labour market: a global view

Published online by Cambridge University Press:  09 December 2019

Axel Börsch-Supan ,
Felizia Hanemann ,
Brian Beach Open the ORCID record for Brian Beach [Opens in a new window] ,
Didier Halimi ,
Susana Harding ,
Marieke van der Waal ,
Daisuke Watanabe  and
Ursula M. Staudinger Open the ORCID record for Ursula M. Staudinger [Opens in a new window]
Axel Börsch-Supan*
Affiliation:
Munich Center for the Economics of Aging (MEA) at the Max Planck Institute for Social Law and Social Policy, Munich, Germany Department of Economics and Business, Technical University of Munich (TUM), Munich, Germany National Bureau of Economic Research, Cambridge, Massachusetts, USA
Felizia Hanemann
Affiliation:
Munich Center for the Economics of Aging (MEA) at the Max Planck Institute for Social Law and Social Policy, Munich, Germany Department of Economics and Business, Technical University of Munich (TUM), Munich, Germany
Brian Beach
Affiliation:
International Longevity Centre – UK (ILC-UK), London, UK
Didier Halimi
Affiliation:
International Longevity Centre – France (ILC-F), Paris, France
Susana Harding
Affiliation:
Tsao Foundation, Singapore International Longevity Centre – Singapore (ILC-SIN), Singapore
Marieke van der Waal
Affiliation:
Leyden Academy on Vitality and Ageing, Leiden, The Netherlands International Longevity Centre – Netherlands (ILC-NL), Leiden, The Netherlands
Daisuke Watanabe
Affiliation:
Faculty of Humanities, Seikei University, Tokyo, Japan International Longevity Centre – Japan (ILC-J), Tokyo, Japan
Ursula M. Staudinger
Affiliation:
Robert N. Butler Columbia Aging Center (ILC-USA), Columbia University, New York, USA Department of Sociomedical Sciences, Mailman School of Public Health, Columbia University, New York, USA
*
*Corresponding author. Email: [email protected]
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Abstract

What governs labour force participation in later life and why is it so different across countries? Health and labour force participation in older ages are not strongly linked, but we observe a large variation across countries in old-age labour force participation. This points to the important role of country-specific regulations governing pension receipt and old-age labour force participation. In addition to the statutory eligibility age for a pension, such country-specific regulations include: earnings tests that limit the amount of earnings when pension benefits are received; the amount of benefit deductions for early retirement; the availability of part-time pensions before normal retirement; special regulations that permit early retirement for certain population groups; and either subsidies or extra costs for employers if they keep older employees in their labour force. This paper asks two questions: Can we link a relatively low labour force participation at ages 60–64 to country-specific regulations that make early retirement attractive? and Can we link a relatively high labour force participation at ages 65–74 to country-specific regulations that make late retirement attractive? To answer these questions, we compared the experiences in a set of developed countries around the world in order to understand better the impact of country-specific rules and laws on work and retirement behaviour at older ages and, by consequence, on the financial sustainability of pension systems.

Keywords

retirement policieslabour market participationpopulation ageingpension systemsretirement incentives
Type
Article
Information
Ageing & Society , Volume 41 , Issue 4 , April 2021 , pp. 917 - 935
Copyright
Copyright © Cambridge University Press 2019

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