Into retirement before one’s time

The study examines the early retirement of older workers in Finland.

The labour market participation of older people has declined significantly: for example, the labour force participation rate of those aged 60–64 fell from 49 percent to 25 percent over twenty years. Behind this development lie structural change, rising unemployment, and the expansion of early retirement options. The flexible retirement alternatives introduced from 1986 onwards — early old-age pension, individual early retirement pension, and part-time pension — substantially changed the situation.

The individual early retirement pension and early old-age pension proved more popular than anticipated, while the part-time pension proved less popular than expected. In 1989, early retirement pensions accounted for nearly 29 percent of total pension expenditure.

The study seeks to examine the background factors behind the transition to early retirement by making use of both time-series data and Statistics Finland’s individual-level longitudinal data for the years 1984–1987. Of particular interest is which individual and labour market factors explain the propensity to retire early. (AI translation)

• ISSN: 0358-5980
• ISBN: 951-9282-39-4