Early exit or longer stay? The effect of precarious employment on planned age of retirement

The purpose of this paper is to investigate how precarious conditions at work affect older workers’ decision about their planned age of retirement.

Different theoretical approaches on the decision to retire are investigated in order to ascertain whether precarious employment extends, or not, one’s working life. A rich data set including over 250,000 old workers across EU-15 is built for the empirical investigation.

The results suggest that old workers involved in precarious employment are planning to retire later than those who are engaged with more stable and regular jobs. However, lack of training as well as poor health conditions at work are found to be associated with early retirement.

The analysis conceptually associates two key features of modern labour markets (precariousness and retirement) and empirically provides some evidence of the effect of poor employment conditions on the decision to retire.