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Job Loss and Retirement Behavior of Older Men

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  • Sewin Chan
  • Ann Huff Stevens

Abstract

This paper uses data from the Health and Retirement Study to examine the employment and retirement behavior of men aged fifty and above who have experienced an involuntary job loss. Hazard models for returning to work and for exiting post-displacement employment are estimated and used to examine work patterns for ten years following a job loss. The findings show that a job loss results in large and lasting effects on future employment probabilities, and that these effects vary with the age of the worker. Displaced workers in their fifties are estimated to have a three in four chance of returning to work within two years after a job loss, whereas for a 62-year-old job loser, the probability is less than a third. Once re-employed, men 50 and above face significantly higher probabilities of exiting the workforce than do workers who have not experienced a recent job loss; however, the direction of this effect gradually reverses over time. The net outcome of these entry and exit rates is a substantial gap between the employment rates of men who have and have not lost jobs, that lasts at least seven years.

Suggested Citation

  • Sewin Chan & Ann Huff Stevens, 1999. "Job Loss and Retirement Behavior of Older Men," NBER Working Papers 6920, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:6920 Note: LS
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    References listed on IDEAS

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    Cited by:

    1. Christopher J. O'Leary & Stephen A. Wandner, 2001. "Unemployment Compensation and Older Workers," Book chapters authored by Upjohn Institute researchers, W.E. Upjohn Institute for Employment Research.
    2. Ann Huff Stevens & Sewin Chan, 1999. "Employment and Retirement Following a Late-Career Job Loss," American Economic Review, American Economic Association, vol. 89(2), pages 211-216, May.
    3. Andrew Foote & Michel Grosz & Ann Stevens, 2015. "Locate Your Nearest Exit: Mass Layoffs and Local Labor Market Response," Working Papers 15-25, Center for Economic Studies, U.S. Census Bureau.
    4. Disney, Richard & Whitehouse, Edward, 1999. "Pension plans and retirement incentives," Social Protection and Labor Policy and Technical Notes 20851, The World Bank.
    5. Purvi Sevak, 2002. "Wealth Shocks and Retirement Timing: Evidence from the Nineties," Working Papers wp027, University of Michigan, Michigan Retirement Research Center.

    More about this item

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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