IDEAS home Printed from https://ideas.repec.org/p/boc/bocoec/436.html
   My bibliography  Save this paper

Retirement Trends and Policies to Encourage Work Among Older Americans

Author

Listed:
  • Gary Burtless

    () (Brookings Institution)

  • Joseph F. Quinn

    () (Boston College)

Abstract

The trend toward earlier and earlier retirement was one of the most important labor market developments of the twentieth century. It was evident in all the major industrialized countries. In the United States, however, the trend toward earlier retirement came to at least a temporary halt in the mid-1980s. Male participation rates at older ages have stabilized or even increased slightly. Older womens' participation rates are clearly rising. This paper examines the environmental and policy changes contributing to the long-term decline in the U.S. retirement age as well as developments that contributed to the recent reversal. The dominant source of earlier retirement was the long-term increase in Americans' wealth, which permitted workers to enjoy rising living standards even as they spent a growing percentage of their lives outside the paid work force. The expansion of Social Security pensions and of employer-sponsored pension plans and the introduction of mandatory retirement rules also encouraged earlier retirement over much of the last century. Many public policies and private institutions that encouraged early retirement have been modified in recent years. Mandatory retirement has been outlawed in most jobs. Social Security is no longer growing more generous, and worker coverage under company pension plans is no longer rising. Both Social Security and many private pensions have become more "age neutral" with respect to retirement. Public and private pension programs now provide weaker financial incentives for workers to retire at particular ages, such as age 62 or age 65, and offer stronger incentives for aging workers to remain in the labor force. The paper outlines additional policies that could encourage later retirement. An open question is whether such policies are needed. Rising labor productivity and increased work effort during the pre-retirement years mean that Americans can continue to enjoy higher living standards, even as improved longevity adds to the number of years that workers spend in retirement. If opinion polls are to be believed, most workers favor preserving the institutions that allow early retirement even if it means these institutions will require heavier contributions from active workers.

Suggested Citation

  • Gary Burtless & Joseph F. Quinn, 2000. "Retirement Trends and Policies to Encourage Work Among Older Americans," Boston College Working Papers in Economics 436, Boston College Department of Economics.
  • Handle: RePEc:boc:bocoec:436
    as

    Download full text from publisher

    File URL: http://fmwww.bc.edu/EC-P/wp436.pdf
    File Function: main text
    Download Restriction: no

    References listed on IDEAS

    as
    1. J. E. Stiglitz, 1999. "Introduction," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 28(3), pages 249-254, November.
    2. Alicia H. Munnell, 1997. "Social Security: it ain't broken," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 41(Jun), pages 297-303.
    3. Joseph F. Quinn, 1999. "Has the Early Retirement Trend Reversed?," Boston College Working Papers in Economics 424, Boston College Department of Economics.
    4. Krueger, Alan B & Pischke, Jorn-Steffen, 1992. "The Effect of Social Security on Labor Supply: A Cohort Analysis of the Notch Generation," Journal of Labor Economics, University of Chicago Press, vol. 10(4), pages 412-437, October.
    5. Burtless, Gary & Moffitt, Robert A, 1985. "The Joint Choice of Retirement Age and Postretirement Hours of Work," Journal of Labor Economics, University of Chicago Press, vol. 3(2), pages 209-236, April.
    6. Sveinbjörn Blöndal & Stefano Scarpetta, 1999. "The Retirement Decision in OECD Countries," OECD Economics Department Working Papers 202, OECD Publishing.
    7. Gary Burtless, 1986. "Social Security, Unanticipated Benefit Increases, and the Timing of Retirement," Review of Economic Studies, Oxford University Press, vol. 53(5), pages 781-805.
    8. Courtney Coile & Jonathan Gruber, 2000. "Social Security and Retirement," NBER Working Papers 7830, National Bureau of Economic Research, Inc.
    9. Joseph F. Quinn, 1993. "The Future Of Retirement," Boston College Working Papers in Economics 249, Boston College Department of Economics.
    10. Joseph F. Quinn, 1993. "Retirement And The Labor Force Behavior Of The Elderly," Boston College Working Papers in Economics 257, Boston College Department of Economics.
    11. Joseph F. Quinn & Richard V. Burkhauser & Daniel A. Myers, 1990. "Passing the Torch: The Influence of Economic Incentives on Work and Retirement," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number pt, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ignacio Álvarez & Natalia da Silva & Álvaro Forteza & Ianina Rossi, 2012. "Incentivos y patrones de retiro en Uruguay," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 27(2), pages 219-271.
    2. C Machado & Miguel Portela, 2014. "Hours of work and retirement behaviour," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-22, December.
    3. David Dorn & Alfonso Sousa-Poza, 2010. "'Voluntary' and 'involuntary' early retirement: an international analysis," Applied Economics, Taylor & Francis Journals, vol. 42(4), pages 427-438.
    4. David Dorn & Alfonso Sousa-Poza, 2005. "Early Retirement: Free Choice or Forced Decision," CESifo Working Paper Series 1542, CESifo Group Munich.
    5. Beatrice Scheubel & Daniel Schunk & Joachim Winter, 2009. "Don't Raise the Retirement Age! An Experiment on Opposition to Pension Reforms and East-West Differences in Germany," CESifo Working Paper Series 2752, CESifo Group Munich.
    6. Gordon B.T. Mermin & Richard W. Johnson & Dan Murphy, 2006. "Why Do Boomers Plan to Work So Long?," Working Papers, Center for Retirement Research at Boston College wp2006-19, Center for Retirement Research, revised Nov 2006.
    7. Karakaya, Güngör, 2008. "Early cessation of activity in the labour market: impact of supply and demand factors," MPRA Paper 13390, University Library of Munich, Germany.
    8. 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.
    9. Bernardo Lanza Queiroz, 2007. "The determinants of male retirement in urban Brazil," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 17(1), pages 11-36, January-A.
    10. Bernardo Lanza Queiroz & Moema Gonçalves Bueno Figoli, 2011. "Population aging and the rising costs of public pension in Brazil," Textos para Discussão Cedeplar-UFMG td438, Cedeplar, Universidade Federal de Minas Gerais.
    11. James M. Poterba & Steven F. Venti, 2004. "The Transition to Personal Accounts and Increasing Retirement Wealth: Macro- and Microevidence," NBER Chapters,in: Perspectives on the Economics of Aging, pages 17-80 National Bureau of Economic Research, Inc.
    12. Bernardo Queiroz, 2013. "Social security, economic development and the labor force participation of the elderly in Latin America," Textos para Discussão Cedeplar-UFMG 490, Cedeplar, Universidade Federal de Minas Gerais.
    13. Alvaro Forteza & Graciela Sanromán, 2011. "Estimación de un modelo estructural para las decisiones de retiro en Uruguay," Documentos de Trabajo (working papers) 2411, Department of Economics - dECON.
    14. James M. Poterba & Steven F. Venti & David A. Wise, 2001. "The Changing Face of Private Retirement Saving in the United States," CESifo Forum, Ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 2(4), pages 3-11, October.
    15. Fabio Pammolli & Nicola Carmine Salerno, 2004. "Regole pensionistiche e prolungamento dell'attività: analisi del TIR e effetti del cumulo lavoro-pensione," Working Papers CERM 07-2004, Competitività, Regole, Mercati (CERM).
    16. Karen Leppel, 2005. "Labor force plans and labor force status," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 12(8), pages 173-196, April.
    17. Donald Bruce & Douglas Holtz-Eakin & Joseph F. Quinn, 2000. "Self-Employment and Labor Market Transitions at Older Ages," Boston College Working Papers in Economics 490, Boston College Department of Economics.
    18. Cori E. Uccello, 2001. "Are Americans Saving Enough For Retirement?," Issues in Brief ib-7, Center for Retirement Research.
    19. Blau, David M. & Goodstein, Ryan, 2007. "What Explains Trends in Labor Force Participation of Older Men in the United States?," IZA Discussion Papers 2991, Institute for the Study of Labor (IZA).
    20. David T. Ellwood, 2001. "The Sputtering Labor Force of the 21st Century. Can Social Policy Help?," NBER Working Papers 8321, National Bureau of Economic Research, Inc.
    21. David M. Blau & Ryan M. Goodstein, 2010. "Can Social Security Explain Trends in Labor Force Participation of Older Men in the United States?," Journal of Human Resources, University of Wisconsin Press, vol. 45(2).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:boc:bocoec:436. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F Baum) or (Christopher F. Baum). General contact details of provider: http://edirc.repec.org/data/debocus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.