The 2008–2009 Great Recession and employment outcomes among older workers

Abstract

This study examined whether economic changes related to the 2008–2009 Recession were associated with employment status and job quality indicators among older workers in Europe and Israel. Data were derived from 4917 respondents (16,090 observations both before and after the recession) from 13 countries who participated in the Survey of Health, Ageing and Retirement in Europe. Annual data on gross domestic product (GDP) per capita, life expectancy, and quarterly unemployment rates were assigned to employment assessments from 2004 to 2013. Using difference-in-differences models, we assessed the recession’s implications on individual employment outcomes, while isolating cyclical variation within countries and individual changes over time. Among older workers, decreases in GDP were associated with an increase in the likelihood of being unemployed and a decrease in the likelihood of being retired. An increasing country-level unemployment rate had a significant effect on aspects of job quality: lower prospects for job advancement, lower job security, and higher job satisfaction. Economic recessions are thus negatively associated with employment outcomes for older workers. However, malleable policy-related factors such as longer tenure and improved general health can limit the negative employment and job quality outcomes following a recession.

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Acknowledgements

This paper uses data from SHARE waves 1, 2, 4, and 5 (DOIs: 10.6103/SHARE.w1.260, 10.6103/SHARE.w2.260, 10.6103/SHARE.w4.111, 10.6103/SHARE.w5.100), see Borsch-Supan et al. (2013) for methodological details.

The SHARE data collection has been primarily funded by the European Commission through FP5 (QLK6-CT-2001-00360), FP6 (SHARE-I3: RII-CT-2006-062193, COMPARE: CIT5-CT-2005-028857, SHARE-LIFE: CIT4-CT-2006-028812), and FP7 (SHARE-PREP: N°211909, SHARE-LEAP: N°227822, SHARE M4: N°261982). Additional funding from the German Ministry of Education and Research, the U.S. National Institute on Aging (U01_AG09740-13S2, P01_AG005842, P01_AG08291, P30_AG12815, R21_AG025169, Y1-AG-4553-01, IAG_BSR06-11, OGHA_04-064), and various national funding sources is gratefully acknowledged (see www.share-project.org).

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Correspondence to Hila Axelrad.

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Responsible Editor: H. Litwin.

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Axelrad, H., Sabbath, E.L. & Hawkins, S.S. The 2008–2009 Great Recession and employment outcomes among older workers. Eur J Ageing 15, 35–45 (2018). https://doi.org/10.1007/s10433-017-0429-0

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Keywords

  • Older workers
  • Recessions
  • Job satisfaction
  • Job advancement
  • Job security
  • SHARE