IDEAS home Printed from https://ideas.repec.org/p/upj/weupjo/04-105.html
   My bibliography  Save this paper

Work and Retirement Plans among Older Americans

Author

Listed:
  • Katherine G. Abraham

    (University of Maryland)

  • Susan N. Houseman

    (W.E. Upjohn Institute for Employment Research)

Abstract

We compare older workers' plans for work and retirement with their subsequent work and retirement outcomes using panel data from the Health and Retirement Study. Among those with retirement plans, about half indicate they would like to cut back on their work hours or otherwise change the type of work they do prior to, or instead of, fully retiring. Yet, the fraction that follows through on these alternative plans is dramatically lower than the fraction that realizes plans to stop working. Our analysis shows that individuals who likely would need to change jobs in order to reduce their work hours are much less likely to have plans to reduce hours and, conditional on having such plans, are much less likely to follow through on them. Instead, a large fraction of these individuals stop working entirely. Our findings suggest that older workers may face substantial barriers to job change, and we conclude with a discussion of potential policy implications.

Suggested Citation

  • Katherine G. Abraham & Susan N. Houseman, 2004. "Work and Retirement Plans among Older Americans," Upjohn Working Papers 04-105, W.E. Upjohn Institute for Employment Research.
  • Handle: RePEc:upj:weupjo:04-105
    as

    Download full text from publisher

    File URL: http://research.upjohn.org/cgi/viewcontent.cgi?article=1122&context=up_workingpapers
    Download Restriction: This material is copyrighted. Permission is required to reproduce any or all parts.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Hugo Benítez-Silva & Debra S. Dwyer, 2003. "What to Expect when you are Expecting Rationality: Testing Rational Expectations using Micro Data," Working Papers wp037, University of Michigan, Michigan Retirement Research Center.
    2. B. Douglas Bernheim, 1989. "The Timing of Retirement: A Comparison of Expectations and Realizations," NBER Chapters, in: The Economics of Aging, pages 335-358, National Bureau of Economic Research, Inc.
    3. David A. Wise, 1989. "The Economics of Aging," NBER Books, National Bureau of Economic Research, Inc, number wise89-1, June.
    4. Joseph F. Quinn, 1999. "Has the Early Retirement Trend Reversed?," Boston College Working Papers in Economics 424, Boston College Department of Economics.
    5. John Ameriks & Andrew Caplin & John Leahy, 2003. "Wealth Accumulation and the Propensity to Plan," The Quarterly Journal of Economics, Oxford University Press, vol. 118(3), pages 1007-1047.
    6. Ruhm, Christopher J, 1990. "Bridge Jobs and Partial Retirement," Journal of Labor Economics, University of Chicago Press, vol. 8(4), pages 482-501, October.
    7. Gary Burtless & Joseph F. Quinn, 2002. "Is Working Longer the Answer for an Aging Workforce?," Boston College Working Papers in Economics 550, Boston College Department of Economics.
    8. Debra S. Dwyer & Jianting Hu, "undated". "Retirement Expectations and Realizations: The Role of Health Shocks and Economic Factors," Pension Research Council Working Papers 98-18, Wharton School Pension Research Council, University of Pennsylvania.
    9. Joseph G. Altonji & Christina H. Paxson, 1992. "Labor Supply, Hours Constraints, and Job Mobility," Journal of Human Resources, University of Wisconsin Press, vol. 27(2), pages 256-278.
    10. Marjorie Honig & Giora Hanoch, 1985. "Partial Retirement as a Separate Mode of Retirement Behavior," Journal of Human Resources, University of Wisconsin Press, vol. 20(1), pages 21-46.
    11. Kathryn H. Anderson & Richard V. Burkhauser & Joseph F. Quinn, 1986. "Do Retirement Dreams Come True? The Effect of Unanticipated Events on Retirement Plans," ILR Review, Cornell University, ILR School, vol. 39(4), pages 518-526, July.
    12. Alan L. Gustman & Thomas L. Steinmeier, 1983. "Retirement Flows," NBER Working Papers 1069, National Bureau of Economic Research, Inc.
    13. Blau, David M, 1994. "Labor Force Dynamics of Older Men," Econometrica, Econometric Society, vol. 62(1), pages 117-156, January.
    14. Chan, Sewin & Stevens, Ann Huff, 2001. "Job Loss and Employment Patterns of Older Workers," Journal of Labor Economics, University of Chicago Press, vol. 19(2), pages 484-521, April.
    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. David Neumark, 2008. "The Age Discrimination in Employment Act and the Challenge of Population Aging," NBER Working Papers 14317, National Bureau of Economic Research, Inc.
    2. Huber, Martin & Lechner, Michael & Wunsch, Conny, 2013. "The Effect of Firms' Partial Retirement Policies on the Labour Market Outcomes of Their Employees," IZA Discussion Papers 7513, Institute of Labor Economics (IZA).
    3. David Blau & Tetyana Shvydko, 2011. "Labor Market Rigidities and the Employment Behavior of Older Workers," ILR Review, Cornell University, ILR School, vol. 64(3), pages 464-484, April.
    4. Abraham, Katharine G. & Hershbein, Brad & Houseman, Susan N., 2021. "Contract work at older ages," Journal of Pension Economics and Finance, Cambridge University Press, vol. 20(3), pages 426-447, July.
    5. Damon Jones & Alexander M. Gelber & Daniel W. Sacks & Jae Song, 2017. "Using Kinked Budget Sets to Estimate Extensive Margin Responses: Method and Evidence from the Social Security Earnings Test," Working Papers 2017-034, Human Capital and Economic Opportunity Working Group.
    6. Boockmann, Bernhard & Fries, Jan & Göbel, Christian, 2018. "Specific measures for older employees and late career employment," The Journal of the Economics of Ageing, Elsevier, vol. 12(C), pages 159-174.
    7. 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.
    8. Ghosheh Jr, N.S. & Lee, Sangheon, & McCann, Deirdre M., 2006. "Conditions of work and employment for older workers in industrialized countries : understanding the issues," ILO Working Papers 993864863402676, International Labour Organization.
    9. repec:ilo:ilowps:386486 is not listed on IDEAS

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ricky Kanabar, 2012. "Unretirement in England: An empirical perspective," Discussion Papers 12/31, Department of Economics, University of York.
    2. Hugo Benítez-Silva & Debra Dwyer & Wayne-Roy Gayle & Thomas Muench, 2008. "Expectations in micro data: rationality revisited," Empirical Economics, Springer, vol. 34(2), pages 381-416, March.
    3. Benitez-Silva, Hugo & Dwyer, Debra S., 2006. "Expectation formation of older married couples and the rational expectations hypothesis," Labour Economics, Elsevier, vol. 13(2), pages 191-218, April.
    4. Steven J. Haider & Melvin Stephens, 2007. "Is There a Retirement-Consumption Puzzle? Evidence Using Subjective Retirement Expectations," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 247-264, May.
    5. Deborah A. Cobb-Clark & Steve Stillman, 2006. "The Retirement Expectations of Middle-Aged Individuals," CEPR Discussion Papers 540, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    6. repec:eee:labchp:v:3:y:1999:i:pc:p:3261-3307 is not listed on IDEAS
    7. Diana Warren, 2008. "Retirement Expectations and Labour Force Transitions: The Experience of the Baby Boomer Generation," Melbourne Institute Working Paper Series wp2008n24, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    8. Boockmann, Bernhard & Fries, Jan & Göbel, Christian, 2018. "Specific measures for older employees and late career employment," The Journal of the Economics of Ageing, Elsevier, vol. 12(C), pages 159-174.
    9. Hugo Benítez-Silva & Debra S. Dwyer, 2003. "What to Expect when you are Expecting Rationality: Testing Rational Expectations using Micro Data," Working Papers wp037, University of Michigan, Michigan Retirement Research Center.
    10. Bound, John & Schoenbaum, Michael & Stinebrickner, Todd R. & Waidmann, Timothy, 1999. "The dynamic effects of health on the labor force transitions of older workers," Labour Economics, Elsevier, vol. 6(2), pages 179-202, June.
    11. B. Douglas Bernheim, 1990. "How Do the Elderly Form Expectations? An Analysis of Responses to New Information," NBER Chapters, in: Issues in the Economics of Aging, pages 259-286, National Bureau of Economic Research, Inc.
    12. Sewin Chan & Ann Huff Stevens, 1999. "Job Loss and Retirement Behavior of Older Men," NBER Working Papers 6920, National Bureau of Economic Research, Inc.
    13. Michael D. Hurd, 1993. "The Effect of Labor Market Rigidities on the Labor Force Behavior of Older Workers," NBER Working Papers 4462, National Bureau of Economic Research, Inc.
    14. 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.
    15. Jeff Borland, 2005. "Transitions to Retirement: A Review," Melbourne Institute Working Paper Series wp2005n03, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    16. Kathryn Anderson & Richard Burkhauser & George Slotsve, 1991. "A Two Decade Comparison of Work after Retirement in the United States," Discussion Papers of DIW Berlin 32, DIW Berlin, German Institute for Economic Research.
    17. Kanabar, Ricky, 2015. "Post-retirement labour supply in England," The Journal of the Economics of Ageing, Elsevier, vol. 6(C), pages 123-132.
    18. Pettersson, Jan, 2011. "Instead of Bowling Alone? Unretirement of Old-Age Pensioners," Working Paper Series 2011:14, Uppsala University, Department of Economics.
    19. Purvi Sevak & Lucie Schmidt, 2011. "Macroeconomic Conditions and Updating of Expectations by Older Americans," Working Papers wp259, University of Michigan, Michigan Retirement Research Center.
    20. Bender, Keith A. & Mavromaras, Kostas & Theodossiou, Ioannis & Wei, Zhang, 2014. "The Effect of Wealth and Earned Income on the Decision to Retire: A Dynamic Probit Examination of Retirement," IZA Discussion Papers 7927, Institute of Labor Economics (IZA).
    21. Steven J. Haider & David S. Loughran, 2003. "How Important Are Wages to the Elderly? Evidence from the New Beneficiary Data System and the Social Security Earnings Test," Working Papers wp049, University of Michigan, Michigan Retirement Research Center.

    More about this item

    Keywords

    retirement; social security; older; workers; Houseman; Abraham;
    All these keywords.

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

    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:upj:weupjo:04-105. 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: . General contact details of provider: https://edirc.repec.org/data/upjohus.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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (email available below). General contact details of provider: https://edirc.repec.org/data/upjohus.html .

    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.