Grants

RAND Corporation

To find out how labor force participation at older ages has increased even as some determinants of participation have worsened, and whether the trend towards working at older ages is likely to continue in the future, especially in view of adverse trends in health

  • Amount $399,958
  • City Santa Monica, CA
  • Investigator Susann Rohwedder
  • Year 2016
  • Program Working Longer
  • Sub-program

The ability to accurately predict the U.S. labor force participation rate among older workers is important, not least because it bears significantly on the finances of the Social Security system. Traditional methods for predicting this crucial statistic involve extrapolating from past trends. Past trends, however, may not continue. Over the past 25 years, for instance, the labor force participation rate of the population aged 60 to 69 has been increasing, in part because Americans in their 60s were getting progressively healthier. But recent studies suggest this is no longer the case. What effects, if any, will the halting of this trend toward better health in older Americans have on labor force participation rates? This grant funds the work of researchers Susann Rohwedder and Michael Hurd, who are examining this issue. Using twelve waves of data from the Health and Retirement Study (HRS), Rohwedder and Hurd will study how labor force participation at older ages has increased even as some determinants of participation have worsened and examine whether the trend toward working at older ages is likely to continue, especially in view of adverse trends in health. One particular focus of their work will be the relationship between labor force participation rates and individuals’ forecasts about how long they will continue to work as they age, examining how predictive these forecasts have been in the past and how their predictive power varies along multiple dimensions. Once this relationship is better understood, the hope is to use this knowledge to inform forecasts of labor force participation rates going forward.

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