Is Working Longer the Answer for an Aging Workforce?
AbstractOne of the most important labor market developments of the last century was the sustained trend toward earlier retirement among American men. This trend came to at least a temporary halt in the mid-1980s. Since then, male participation rates at older ages have stabilized or even increased slightly, while older women's participation rates have begun rising dramatically. The dominant factor driving the trend toward earlier male retirement was a long-term increase in economic wealth, which permitted workers to enjoy rising living standards even as they spent a growing percentage of their lives outside the workforce. The expansion of Social Security and of employer-sponsored pension plans, and the introduction of mandatory retirement rules, also encouraged earlier retirement over much of the last century. In recent years, many public policies and private institutions that encourage early retirement have been modified. Mandatory retirement was outlawed in most jobs. Social Security is no longer growing more generous, and coverage under company pension plans is no longer rising. In addition, both Social Security and private pensions have become more "age neutral," meaning that they provide either weaker incentives or no incentives to retire at particular ages, such as age 62 or age 65. Finally, the scheduled rise in Social Security's normal retirement age over the next two decades will encourage later retirements, at least modestly. An open question is whether further changes are needed. Given that labor force growth is slowing and Americans are enjoying longer and healthier lives, efforts to encourage people to work longer could have important benefits both for individuals and for the national economy. On the other hand, rising labor productivity, increased work effort, and more saving during the pre-retirement years could allow Americans to enjoy higher living standards even if they choose to spend more years in retirement. If opinion polls are to be believed, most workers favor preserving options for early retirement, even if it means heavier contributions to the retirement system during their working careers.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Boston College Department of Economics in its series Boston College Working Papers in Economics with number 550.
Length: 12 pages
Date of creation: 17 Dec 2002
Date of revision:
Note: This paper has been published as an Issue in Brief of the Center for Retirement Research at Boston College.
Contact details of provider:
Postal: Boston College, 140 Commonwealth Avenue, Chestnut Hill MA 02467 USA
Web page: http://fmwww.bc.edu/EC/
More information through EDIRC
Other versions of this item:
- Gary Burtless & Joseph F. Quinn, 2002. "Is Working Longer the Answer for an Aging Workforce?," Issues in Brief ib2002-11, Center for Retirement Research, revised Dec 2002.
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Gopi Shah Goda & John Shoven & Sita Slavov, 2009.
"A Tax On Work For The Elderly: Medicare As A Secondary Payer,"
08-60, Stanford Institute for Economic Policy Research.
- Gopi Shah Goda & John B. Shoven & Sita Nataraj Slavov, 2007. "A Tax on Work for the Elderly: Medicare as a Secondary Payer," NBER Working Papers 13383, National Bureau of Economic Research, Inc.
- Martins, Pedro S. & Novo, Alvaro A. & Portugal, Pedro, 2009. "Increasing the Legal Retirement Age: The Impact on Wages, Worker Flows and Firm Performance," IZA Discussion Papers 4187, Institute for the Study of Labor (IZA).
- Katherine G. Abraham & Susan N. Houseman, 2005.
"Work and Retirement Plans among Older Americans,"
Book chapters authored by Upjohn Institute researchers,
in: Robert L. Clark & Olivia S. Mitchell (ed.), Reinventing the Retirement Paradigm, pages 70-91
W.E. Upjohn Institute for Employment Research.
- Kevin E. Cahill, & Michael D. Giandrea, & Joseph F. Quinn, 2013. "Are Gender Differences Emerging in the Retirement Patterns of the Early Boomers?," Working Papers 468, U.S. Bureau of Labor Statistics.
- Kristin Mammen, 2008. "The Long-Term Effects of the Divorce Revolution: Health, Wealth, and Labor Supply," Working Papers, Center for Retirement Research at Boston College wp2008-22, Center for Retirement Research, revised Nov 2008.
- Laitner, John & Silverman, Dan, 2012. "Consumption, retirement and social security: Evaluating the efficiency of reform that encourages longer careers," Journal of Public Economics, Elsevier, vol. 96(7-8), pages 615-634.
- Gopi Shah Goda & John B. Shoven & Sita Nataraj Slavov, 2007.
"Removing the Disincentives in Social Security for Long Careers,"
NBER Working Papers
13110, National Bureau of Economic Research, Inc.
- Gopi Shah Goda & John B. Shoven & Sita Nataraj Slavov, 2009. "Removing the Disincentives in Social Security for Long Careers," NBER Chapters, in: Social Security Policy in a Changing Environment, pages 21-38 National Bureau of Economic Research, Inc.
- Alicia H. Munnell & Steven A. Sass, 2007. "The Labor Supply of Older Americans," Working Papers, Center for Retirement Research at Boston College wp2007-12, Center for Retirement Research, revised Jun 2007.
- Gopi Shah Goda & John Shoven & Sita Slavov, 2008. "Removing the Disincentives for Long Careers in the Social Security and Medicare Benefit Structure," Discussion Papers 08-058, Stanford Institute for Economic Policy Research.
- Courtney C. Coile & Phillip B. Levine, 2004.
"Bulls, Bears, and Retirement Behavior,"
NBER Working Papers
10779, National Bureau of Economic Research, Inc.
- Katharine G. Abraham & Susan N. Houseman, 2008. "Removing Barriers to Work for Older Americans," Book chapters authored by Upjohn Institute researchers, in: Timothy J. Bartik & Susan N. Houseman (ed.), A Future of Good Jobs? America's Challenge in the Global Economy, chapter 5, pages 161-202 W.E. Upjohn Institute for Employment Research.
- John Laitner & Daniel Silverman, 2006. "Consumption, Retirement, and Social Security: Evaluating the Efficiency of Reform with a Life-Cycle Model," Working Papers wp142, University of Michigan, Michigan Retirement Research Center.
- Schleife, Katrin, 2004. "Dokumentation der Ruhestandsregelungen in verschiedenen Ländern," ZEW Dokumentationen 04-01, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Verbič, Miroslav & Spruk, Rok, 2011. "Aging population and public pensions: theory and evidence," MPRA Paper 38914, University Library of Munich, Germany.
- John A. Turner, 2007. "Work at Older Ages: Is Raising the Early Retirement Age an Option for Social Security Reform?," Working Papers, Center for Retirement Research at Boston College wp2007-13, Center for Retirement Research, revised Jun 2007.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F Baum).
If references are entirely missing, you can add them using this form.