Study: Retaining older workers

Alternative working arrangements may be an important incentive in encouraging older workers to stay on the job, according to a new study.

Over one-quarter of people who retired between 1992 and 2002 would have continued working had they been able to reduce their work schedule, either by working fewer days or shorter days without their pension being affected, the study found.

Similarly, 28% would have continued working if they had been offered part-time employment.

About 27% might have been tempted to keep working if their health had been better, while 21% would have stayed if their salary had been increased, although they were not asked by how much.

The study used data from the 2002 General Social Survey to examine how willing Canadians who retired during the previous 10 years would have been to continue working given certain incentives.

The growing number of people nearing retirement has spurred interest in encouraging older workers to stay on the job.

Only 12% of these retirees said they would have kept working if mandatory retirement policies had not existed. An additional 6% said they would have stayed if suitable arrangements for caregiving had been provided. In all cases, men and women responded similarly.

The extent to which older workers constitute a potential supply of labour is undoubtedly overstated since about one-third retired for health reasons.

One-third of recent retirees did not retire for health reasons; however, they said they would not have continued working given any of the incentives. The remaining one-third were healthy individuals who would have been willing to remain in the work force, at least on a part-time basis. This group offers the best prospect for increasing the overall supply of labour.

Immigrants, individuals with a university degree, and those who received an early retirement incentive were among the most likely to say that alternative working arrangements would have encouraged them to keep working.

Retirees from health care, social assistance, and education were least likely to prefer continued employment. This is an important consideration given the growing number of employees nearing retirement in those industries.

Furthermore, individuals whose financial situation had deteriorated since retirement were much more likely to feel they would have kept working under different conditions.

Definitions, data sources and methods: survey number 4502.

The article "Retaining older workers" is available in the October 2004 online edition of Perspectives on Labour and Income, Vol. 5, no. 10 (75-001-XIE, $6/$52).See How to order products.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Grant Schellenberg (613-951-9580; grant.schellenberg@statcan.gc.ca), Demography Division.