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COVID-19 and retirement decisions of older workers in the euro area

Author

Listed:
  • Botelho, Vasco
  • Weißler, Marco

Abstract

The COVID-19 pandemic triggered a temporary decrease in the labour market activity of older workers in the euro area. Our analysis finds that a part of the decrease was driven by a pandemic-induced shift in the retirement decisions of older workers, affecting around 175,000 people. This represents 0.5% of the labour force aged 55-74 retiring earlier than planned due to the pandemic. The heightened economic uncertainty and health risks stemming from the pandemic persuaded some older workers either to bide their time before returning to work or to retire early. Early retirement was most pronounced for workers in poorer health, stressing the growing importance of health risks for labour market developments. JEL Classification: E24, J14, J26

Suggested Citation

  • Botelho, Vasco & Weißler, Marco, 2022. "COVID-19 and retirement decisions of older workers in the euro area," Economic Bulletin Boxes, European Central Bank, vol. 6.
    • Handle: RePEc:ecb:ecbbox:2022:0006:2
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    More about this item

    Keywords

    COVID-19; Labour force; older workers; retirement;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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