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Contract Work at Older Ages

In: Incentives and Limitations of Employment Policies on Retirement Transitions: Comparisons of Public and Private Sectors

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  • Katharine G. Abraham
  • Brad Hershbein
  • Susan N. Houseman

Abstract

The share of workers who are self-employed rises markedly with age. Given policy concerns about inadequate retirement savings, especially among those with lower education, and the resulting interest in encouraging employment at older ages, it is important to understand the role that self-employment arrangements play in facilitating work among seniors. New data from a survey module fielded on a Gallup telephone survey distinguish independent contractor work from other self-employment and provide information on informal and online platform work. The Gallup data show that, especially after accounting for individuals who are miscoded as employees, self-employment is even more prevalent at older ages than suggested by existing data. Work as an independent contractor is the most common type of self-employment. Roughly one-quarter of independent contractors aged 50 and older work for a former employer. At older ages, self-employment generally – and work as an independent contractor specifically – is more common among the highly educated, accounting for much of the difference in employment rates across education groups. We provide suggestive evidence that differences in opportunities for independent contractor work play an important role in the lower employment rates of less-educated older adults.
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Suggested Citation

  • Katharine G. Abraham & Brad Hershbein & Susan N. Houseman, 2019. "Contract Work at Older Ages," NBER Chapters, in: Incentives and Limitations of Employment Policies on Retirement Transitions: Comparisons of Public and Private Sectors, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberch:14326
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    Cited by:

    1. Dmitri Koustas, 2020. "Insights from New Tax-Based Measures of Gig Work in the United States," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 21(03), pages 5-9, September.
    2. R. Jason Faberman & Andreas I. Mueller & Ayşegül Şahin* & Giorgio Topa, 2020. "The Shadow Margins of Labor Market Slack," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 52(S2), pages 355-391, December.
    3. Katharine G. Abraham & Brad Hershbein & Susan N. Houseman & Beth C. Truesdale, 2024. "The Independent Contractor Workforce: New Evidence on Its Size and Composition and Ways to Improve Its Measurement in Household Surveys," ILR Review, Cornell University, ILR School, vol. 77(3), pages 336-365, May.
    4. Sung‐Hee Jeon & Huju Liu & Yuri Ostrovsky, 2021. "Measuring the gig economy in Canada using administrative data," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 54(4), pages 1638-1666, November.
    5. Joelle Abramowitz, 2021. "What We Talk about When We Talk about Self-employment: Examining Self-employment and the Transition to Retirement among Older Adults in the United States," Working Papers wp423, University of Michigan, Michigan Retirement Research Center.
    6. Bailey, Keith A. & Spletzer, James R., 2021. "A new measure of multiple jobholding in the U.S. economy," Labour Economics, Elsevier, vol. 71(C).
    7. Bavafa, Hessam & Mukherjee, Anita & Welch, Tyler Q., 2023. "Inequality in the golden years: Wealth gradients in disability-free and work-free longevity in the United States," Journal of Health Economics, Elsevier, vol. 92(C).
    8. Cheryl Carleton & Mary T. Kelly, 2022. "Happy at Work - Possible at Any Age?," Villanova School of Business Department of Economics and Statistics Working Paper Series 51, Villanova School of Business Department of Economics and Statistics.

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    More about this item

    JEL classification:

    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • 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
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition

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