Social Security Claiming: Trends and Business Cycle Effects
This study uses household survey data from 1984 to 2009 linked to administrative earnings and benefits records to examine Social Security claiming behavior, which has important implications for older Americans and the system itself. Retirees may begin collecting benefits as early as age 62, but early claimants receive lower monthly benefits for the rest of their lives. Results indicate that early claiming declined over the past decade, after increasing over the previous 10 years. For men, the share claiming at age 62 fell from 55.3 percent in the 1930-34 birth cohort to 46.4 percent in the 1940-44 cohort. Over the same period, the share of women claiming at 62 fell from 59.3 to 49.0 percent. The recent trend toward delayed claiming is evident among all educational groups, not just college graduates. Findings from our models show that high unemployment boosts Social Security claiming among men with limited education. A 1-percentage-point increase in the state unemployment rate is associated with a 0.4-percentage-point increase in the likelihood each month that men who never attended college claim benefits, a relative increase of 6 percent. This estimate implies that the Great Recession increased claiming for men with limited education by about 40 percent. Claiming behavior among women and well-educated men is not significantly correlated with the state unemployment rate, however. Unemployment’s large effect on claiming for less-educated men is consistent with their disproportionately high rates of job loss during economic downturns
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