How Does COVID-Induced Early Retirement Compare to the Great Recession?

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Anqi Chen, Alicia H. Munnell, and Siyan Liu, Boston College

In early 2020, the COVID Recession seemed like it would result in an increase in early Social Security claiming, similar to the Great Recession. However, pretty quickly the COVID Recession turned out to be quite different. It was spurred by a health crisis, potentially increasing the likelihood of early claiming among older workers and accompanied by a quick recovery in the stock market followed by rapidly-rising prices that could enable many with assets to retire early. On the other hand, the unprecedented expansion and generosity of unemployment insurance offered a way for lower-paid workers to stay in the labor force. The following analysis, using data from the Health and Retirement Study, compares how the claiming pattern changed in the recession years 2008-2010 from the expansion years 2004-2006 with how the pattern changed in the recession year 2020 from the expansion years 2016-2018.