Publication Type: Conference Paper/Unpublished Manuscript
Abstract: Objective
To assess the selective and protective impact of early retirement on life.
Design
Long term prospective cohort study.
Subjects
Results are based on 88,941 men and 41,762 women, all members of Gmünder Ersatzkasse (GEK), a German compulsory health insurance with approximately 1.5 million insured persons, who retired at the age 50-65 between January 1990 and December 2004.
Main outcome measures
Hazard ratio for death adjusted for age, age at retirement, year of observation, sex, socioeconomic status, and form of retirement scheme.
Results
Selection: We find significantly higher mortality risks among pensioners with reduced earning capacities than among old-age pensioners who either exited from the labour market at 56-60 or 61-65 for both sexes (P < 0.001, log rank test). After 7.2 years 2 out of 10 male pensioners with reduced earning capacities who retired between 56 and 60 had died while men of the same age group who receive an old-age pension lived on average 5.8 years longer. This difference is 4 years for pensioners who retire at 61-65. There is also a survival gap between women with different retirement schemes despite their higher general life expectancy. Strikingly, the youngest male and female pensioners who leave the labour market at the age of 51-55 because of their reduced earning capacity face the highest mortality risks. Protection: People who retire early and have no health problems do not experience lower long term survival than people who retire late. For women, early retirement even lowers their mortality risks significantly by 25% (0.75, 59 to 95).
Conclusion
With respect to mortality, early retirement triggers both, selective and protective processes. On the one hand, people in ill-health with lower survival chances are selected out of the labour market. On the other hand, healthy pensioners are protected by a less demanding and less stressful life style during retirement. For the former, early retirement is essential, for the latter it is an asset. Pension reformer should take this difference into consideration when cutting back pension programs and increasing retirement age.