The Effect of Physical and Cognitive Decline at Older Ages on Job Mismatch and Retirement

77 Pages Posted: 5 Nov 2018

See all articles by Péter Hudomiet

Péter Hudomiet

RAND Corporation

Michael D. Hurd

RAND Corporation; State University of New York at Stony Brook - College of Arts and Science - Department of Economics; National Bureau of Economic Research (NBER)

Susann Rohwedder

RAND Corporation

Robert J. Willis

University of Michigan at Ann Arbor - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: November 2018

Abstract

Physical and cognitive abilities of older workers decline with age, which can cause a mismatch between abilities and job demands, potentially leading to early retirement. We link longitudinal Health and Retirement Study data to O*NET occupational characteristics to estimate to what extent changes in workers’ physical and cognitive resources change their work-limiting health problems, mental health, subjective probabilities of retirement, and labor market status. While we find that physical and cognitive decline strongly predict all outcomes, only the interaction between large-muscle resources and job demands is statistically significant, implying a strong mismatch at older ages in jobs requiring large-muscle strength. The effects of declines in fine motor skills and cognition are not statistically different across differing occupational job demands.

Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

Suggested Citation

Hudomiet, Péter and Hurd, Michael D. and Rohwedder, Susann and Willis, Robert J., The Effect of Physical and Cognitive Decline at Older Ages on Job Mismatch and Retirement (November 2018). NBER Working Paper No. w25229. Available at SSRN: https://ssrn.com/abstract=3278529

Péter Hudomiet (Contact Author)

RAND Corporation

1776 Main Street
P.O. Box 2138
Santa Monica, CA 90407-2138
United States

Michael D. Hurd

RAND Corporation ( email )

P.O. Box 2138
1776 Main Street
Santa Monica, CA 90407-2138
United States
310-393-0411 (Phone)
310-393-4818 (Fax)

State University of New York at Stony Brook - College of Arts and Science - Department of Economics ( email )

Stony Brook, NY 11794
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Susann Rohwedder

RAND Corporation ( email )

P.O. Box 2138
1776 Main Street
Santa Monica, CA 90407-2138
United States

Robert J. Willis

University of Michigan at Ann Arbor - Department of Economics ( email )

611 Tappan Street
Ann Arbor, MI 48109-1220
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
5
Abstract Views
75
PlumX Metrics