Older Workers and Retirement, Part II
Sunday, Jan. 8, 2023 1:00 PM - 3:00 PM (CST)
- Chair: Susan N. Houseman, W.E. Upjohn Institute for Employment Research
Why Are Older Workers Moving Less While Working Longer?
AbstractOlder workers' labor force participation (LFP) has increased while geographic migration has decreased, confounding conventional economic wisdom. This paper uses data from the Current Population Survey (CPS) and Health and Retirement Study (HRS) data to investigate this puzzle. First, using data from the CPS, I describe several factors that may explain the decline in migration, including greater housing price dispersion, fewer opportunities for wage arbitrage, and better geographical sorting. Next, I turn to data from the HRS to test how older workers' LFP, retirement, migration, and Social Security claiming behavior respond to shocks. I use job displacements to identify shocks to income and Chinese import competition in specific labor markets to identify shocks to housing wealth. Using an augmented differences-in-differences-in-differences estimation strategy, I find that responses to shocks differ by education and homeownership status. In response to a local labor market shock that spills over into housing wealth, non-college-educated homeowners (the largest subgroup of older workers) sharply reduce their two-year migration rate by 54% but reduce their labor supply only slightly, while college-educated renters (the smallest subgroup) increase their labor supply by 13% but only weakly increase their propensity to move. As most education-by-homeownership groups reduce (increase) their LFP and migration propensity jointly, my results suggest that the decoupling of LFP and migration in the aggregate is being driven by composition effects.
Measuring Work among Older Adults: The Role of Retirement Transitions
AbstractRecent research has shown substantial discrepancies in measurement of work arrangements between surveys and administrative records. These discrepancies are potentially important for understanding transitions to retirement, as many workers transition across work arrangements as they age. For example, older workers are more likely to report self-employment as both career wage earners may become more likely to transition into self-employment either directly or after a spell of non-employment and career self-employed remain self-employed and work longer. This paper uses the 1994-2020 waves of the HRS linked to Social Security Administration earnings records to examine (1) how reported work arrangements differ in the survey and administrative records and (2) how age and retirement dynamics contribute to these differences, and (3) how retirement transitions coincident with the Covid-19 pandemic differ from previous transition patterns. Preliminary results show persistent discrepancies in reporting of employment income in tax records as compared to survey records by HRS respondents. Results further show distinctive patterns in changes in work arrangements with age that might exacerbate these differences.
Older Workers and Retirement Security: A Review
AbstractThis article documents risks and disparities in the labor force and in retirement preparedness, and explores the links between labor market challenges facing older workers and retirement insecurity. We update and expand upon previous research on issues including recent trends in longevity and health, older workers employment and job quality, and impacts of the COVID-19 pandemic. We show that the current retirement system fails to prepare older workers for retirement, does not provide adequate insurance against health shocks and other risks, and exacerbates existing inequalities in wealth and income. Meanwhile, many older workers face barriers to working longer and unequal access to good jobs with decent pay and benefits. The findings reframe improving access to decent jobs as a complement to, rather than substitute for, retirement readiness.
- J2 - Demand and Supply of Labor
- J6 - Mobility, Unemployment, Vacancies, and Immigrant Workers