The Labor-Force Participation of Older Workers

Abstract

This study examines the decision to participate in the labor force made by persons over 54 years of age. Through the use of a set of pooled time-series cross-section observations from the Current Population Survey over the years 1974 – 80, the analysis emphasizes the effect of two factors on this decision: cohort crowding and Supplemental Security Income (SSI). The empirical results reveal that pressures arising from the relative growth in the youth population led to increased labor market activity by older women; that retirement incentives in the form of SSI and social security had a negative effect on female as well as male labor-force behavior, though the effects were considerably stronger for men; and that the differential between men's and women's participation rates was largely a result of the female response to marital status and retirement incentives.