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The Growing American Health Penalty: International Trends in the Employment of Older Workers with Poor Health

Author

Listed:
  • Baumberg Geiger, Ben

    () (University of Kent)

  • Böheim, René

    () (University of Linz)

  • Leoni, Thomas

    () (WIFO - Austrian Institute of Economic Research)

Abstract

Many countries have reduced the generosity of disability benefits while making them more activating – yet few studies have examined how employment rates have subsequently changed. We present estimates of how the employment rates of older workers with poor health in 13 high-income countries changed between 2004-7 and 2012-15 using HRS/SHARE/ELSA data. We find that those in poor health in the USA have experienced a unique deterioration: they have not only seen a widening gap to the employment rates of those with good health, but their employment rates fell per se. We find only for Sweden (and possibly England) signs that the health employment gap shrank. We then examine possible explanations for the development in the USA: we find no evidence it links to labour market trends, but possible links to the USA's lack of disability benefit reform – which should be considered alongside the wider challenges of our findings for policymakers.

Suggested Citation

  • Baumberg Geiger, Ben & Böheim, René & Leoni, Thomas, 2018. "The Growing American Health Penalty: International Trends in the Employment of Older Workers with Poor Health," IZA Discussion Papers 11769, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp11769
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    References listed on IDEAS

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    1. Hugo Benítez-Silva & Richard Disney & Sergi Jiménez-Martín, 2010. "Disability, capacity for work and the business cycle: an international perspective," Economic Policy, CEPR;CES;MSH, vol. 25, pages 483-536, July.
    2. Baumberg, Ben & Jones, Melanie & Wass, Victoria, 2015. "Disability prevalence and disability-related employment gaps in the UK 1998–2012: Different trends in different surveys?," Social Science & Medicine, Elsevier, vol. 141(C), pages 72-81.
    3. James Banks & James P. Smith, 2012. "International Comparisons in Health Economics: Evidence from Aging Studies," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 57-81, July.
    4. Richard Burkhauser & Mary Daly & Duncan McVicar & Roger Wilkins, 2014. "Disability benefit growth and disability reform in the US: lessons from other OECD nations," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-30, December.
    5. Viola Angelini & Danilo Cavapozzi & Omar Paccagnella, 2011. "Dynamics of reporting work disability in Europe," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 174(3), pages 621-638, July.
    6. Lee, Jinkook & Zamarro, Gema, 2011. "Harmonization of Cross-National Studies of Aging to the Health and Retirement Study: Employment and Retirement Measures," Working Papers 861/4, RAND Corporation.
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    More about this item

    Keywords

    disability benefits; employment of older workers; health employment gap;

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions

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