Does Social Security Explain Work By Older Men?
December 3, 2002
Experts are baffled as to why men are choosing to retire later in life. One theory suggests that Social Security policies are changing trends in labor force participation among men. Older men between the ages 60-69 are impacted by Social Security policies more so than any other age group.
Labor force participation among men between the ages of 60-64 and 65-69 fell steadily from the 1950s to 1985.
- But in 1985 the fall in labor force participation leveled off among men ages 60-64.
- Participation of men ages 65 to 69 has steadily increased since 1985.
- More recently, as penalties for working beyond the age of 65 have been repealed, male labor force participation among males ages 60 to 64 and 65 to 69 has risen 20 percentage points above the trend forecast in the 1980s.
Experts suggest that reduced Social Security benefits have also contributed to these shifts in labor force participation trends. Benefits have been reduced through tax increases and by extending the retirement age. This reduction in Social Security benefits has resulted in a growing number of men continuing to work beyond 65 years of age.
Source: Richard Johnson, "The Puzzle of Later Male Retirement," Economic Review, Volume 87, Number 3, Third Quarter 2002.
Browse more articles on Economic Issues