Impact of the Great Recession on Retirement Trends in Industrialized Countries
The Great Recession had a large impact on unemployment rates and employment prospects in the United States and other industrial countries. In April 2013, 48 million adults in Organisation for Economic Co-operation and Development (OECD) member countries were unemployed, an increase of 16 million, or about 50 percent, compared with the number of unemployed in 2007. The drop in aggregate demand increased the pressure on employers to dismiss workers, and it reduced the number of new job openings, making it harder for jobless workers to find employment. At the same time, the fall in household wealth, caused by declines in asset prices and lengthy spells of joblessness, probably induced some older workers to postpone retirement and encouraged others to return to the work force. When the recession began in 2008 most wealthy member countries of the OECD were in the midst of a trend toward later retirement as reflected in an upward shift in labor force participation rates after age 60. This paper examines whether the Great Recession and the weak recovery that followed slowed or reversed the trend toward higher old-age participation and employment rates.