In medio stat victus: Labor Demand Effects of an Increase in the Retirement Age

Abstract

After falling for four decades, statutory retirement ages are increasing in most OECD countries. The labor market adjustment to these reforms has not yet been thoroughly investigated by the literature. We draw on a major pension reform that took place in Italy in December 2011 that increased the retirement age by up to six years for some categories of workers. We have access to a unique dataset validated by the Italian social security administration (INPS), which identifies in each private firm, based on an administrative exam of eligibility conditions, how many workers were locked in by the sudden increase in the retirement age, and for how long. We find that firms mostly affected by the lock in are those that were downsizing even before the policy shock. The increase in the retirement age seems to displace more middle-aged workers than young workers. Furthermore, there is not a one-to-one increase in the number of older workers in the firms where some workers were locked in by the reform. We provide tentative explanations for these results, based on the interaction between retirement, employment protection legislation and liquidity constraints of firms.

Combination Effectiveness of Listening to Music and Listening Murottal to Reduce Postpartum Depression

“…Based on the gestational age, the highest results were 37-40 weeks (term) of gestation. This age is a good age for labor so that labor can proceed normally (16).…”

Role of labor demand in the labor market effects of a pension reform

“…The substitution of older with prime‐aged employees is less expensive than that of older with young employees (Boeri et al 2021; Hebbink, 1993). Thus, an older employee who stays longer in employment than expected causes higher adaptation costs if their potential substitute is a young employee instead of a prime ‐aged or old employee.…”

“…There is other literature that examines the reaction of employers to pension reforms and their associated supply shocks. These studies concentrate on firm‐level outcomes, including total employment, wages, hiring of younger workers, the offer of early retirement schemes, and value added (Bellmann and Janik, 2007; Bello and Galasso, 2020; Boeri et al 2021; Bovini and Paradisi, 2019; Hakola and Uusitalo, 2005; Hallberg, 2011; Kondo, 2016; Martins et al 2009; Rabaté, 2019 ; Vigtel, 2018). However, these papers do not consider individual differences in retirement behavior within a workforce or examine the labor market effects of pension reforms on the individual employees of affected firms.…”

Labour market trajectories and unemployment of older workers in Europe after the Great Recession

“…Several reasons justify the need for a specific focus on older workers' unemployment. The impact of raising the retirement age and active ageing policies on the labour market has not yet been sufficiently studied (Boeri et al., 2022). The effectiveness of the former stems from individuals being able to postpone their departure from the labour market and avoid needing other income supports, like unemployment benefits (Rabaté & Rochut, 2020).…”