Research on retirement
There are different routes to retirement. Research on the timing of retirement and type of pension benefit provide information on how working lives have extended and how common various pension benefits are (such as the disability pension or the partial old-age pension).
During the research program period, we will study retirement by pension benefit and population group, with a special focus on the effects of the 2017 pension reform. In addition to actual retirement, we will review the population’s retirement intentions and the connection between the intended and actual retirement age. We will review the connection between retirement and workplace-level factors, as well as employers’ attitudes to ageing workers and to the retirement ages within the pension system.
The working life of many ends in retirement on a disability pension. Under this research programme, we will examine disability retirement rates, time-related changes in disability pension application and rejection rates, as well as how the changes differ between various population groups and how they affect the number of persons drawing a disability pension. We will also examine how health, work ability and working conditions affect retirement on a disability pension, measures that support work ability and the process of retirement.
New study
Quality of life improves after retirement despite perceived lower income
The majority of respondents feel that their quality of life has improved after retirement on an old-age pension, with more leisure time increases and better coping skills. However, income is perceived as weaker, according to a survey conducted by the Finnish Centre for Pensions among people who had recently retired from gainful employment with an old-age pension.
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Work ability projections point to a decline in the population’s work ability
The study based on a series of population representative surveys conducted in Finland showed that the self-reported estimates of the work ability of 20–44-year-olds have weakened in the 2000s, the development of the work ability of 45–54-year-olds has been stable and the work ability of those aged 55 or older has improved. Birth-cohort projections suggest a declining work ability in the future. The research article was published in Scandinavian Journal of Public Health.
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Unemployed at the beginning of a sickness absence spell have poor chances of returning to work
Unemployed persons starting a spell of sickness absence are a heterogeneous group with different labour market pathways. For many, the combination of unemployment and work disability means low chances for employment or regained work ability during the following years. Unemployed persons with long history outside employment, older age, low educational level or a mental disorder could benefit from targeted support.
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Majority does not cut down on working while drawing a partial old-age pension
Many persons who draw the partial old-age pension continue working as before, with-out changes to their wage level. Only every fifth person on this pension benefit seems to have cut down on working. This is evident in a recent study by the Finnish Centre for Pensions.
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- Research publication: Wage income before and after taking out a partial old-age pension (Julkari) (Summary in English)
Rehabilitation planning mainly successful – three things require further development
Rehabilitees participating in work trials under the earnings-related pension scheme have fairly positive experiences of rehabilitation planning and cooperation with, for example, occupational health care or the employer. Issues to develop include individual support, timing of rehabilitation and discussions on the possibilities of employment after the work trial. This is evident in a survey by the Finnish Centre for Pensions that is based on interviews of rehabilitees participating in work trials.
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Working in retirement is often irregular and occasional – many fail to find suitable work
Half of the newly retired old-age pensioners are interested in working in retirement. According to a survey conducted by the Finnish Centre for Pensions, most persons who have worked in retirement have continued working for the same employer and with similar tasks. The work is often irregular and occasional.
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Sickness benefit checkpoints increased rehabilitation participation but did not affect a return to work
In 2012, checkpoints at 30, 60 and 90 days into the sickness allowance were introduced in the Finnish sickness absence system to improve early detection of long-term work disability and hasten return to work after illness. The study by the Finnish Centre for Pensions and Kela showed that there was an increase in participation in rehabilitation after the reform, but this did not affect return to work. Both rehabilitation under the earnings-related pension acts and that arranged by Kela increased.
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Rehabiliation participation fairly low among those on a long-term sickenss allowance
Those on a long-term sickness allowance participate only sporadically in rehabilitation paid for by Kela or the earnings-related pension providers. For example, by the 60th day of the sickenss allowance, only 5 per cent of those starting their sickness allowance period had participated in rehabilition. A year later, the share was 17 per cent. A return to work was less likely and transfer to a disability pension more likely the longer the period of the sickness allowance continued. The results stem from a joint project of Kela and the Finnish Centre for Pensions.
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- Final report: Checkpoints for Sickness Allowance Periods: Implementation of Rehabilitation and Return to Work (Valto, Institutional Repository for the Government)
- Policy brief: Supporting the work ability of long-term sickness allowance recipients must be improved (Harnessing knowledge)
- Press release: Study: Kuntoutukseen osallistuminen melko vähäistä sairauspäivärahaa pitkään saaneilla – työkyvyn tukea syytä tehostaa [participation in rehabilitation after long-term health allowance fairly rare – supporting work ability must be improved (Tieto käyttöön)
Self-rated work ability strongly predicts disability retirement
The risk of disability retirement over the next three years was three times as high among those who perceived themselves to be partially disabled and six times as high among those who perceived themselves to be fully disabled compared to those who perceived that they had a full work ability. The study combined data from the Health 2000 and FinHealth 2017 surveys and register data of the Finnish Centre for Pensions. The research article was published in European Journal of Public Health.
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Why has the number of disability pensioners decreased?
The number of disability pension recipients has dropped by more than 25 per cent between 2010 and 2020. For the main part, this is because many of the babyboomers have transitioned from a disability pension to an old-age pension. At the same time, the number of starting disability pensions has declined. This is observed in a research article by the Finnish Centre for Pensions.
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Positive perceptions of work and working conditions may encourage late retirement
Work that is found meaningful and perceived to be less hectic and not involving too many changes is linked to late retirement. This is evident from a survey conducted by the Finnish Centre for Pensions that examined the perceptions of persons who retired on an old-age pension between 2019 and 2021.
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- Study: Positive perceptions of work and working conditions may encourage late retirement (14.9.2023)
Rising retirement age reflected in rising employment rate – unemployment and disability have also increased
The gradual increase of the retirement age agreed on in the 2017 pension reform has considerably raised the employment rate of those approaching their retirement age. At the same time, unemployment and disability retirement have also clearly increased.
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Occupational class inequalities in physical functioning widened after old-age retirement and narrowed after disability retirement
Occupational class inequalities in physical functioning (PF) increased after old-age retirement and decreased after disability retirement. In a study by the University of Helsinki and the Finnish Centre for Pensions, we have reviewed for the first time how PF has developed after old-age and disability retirement.
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- Trajectories in physical functioning by occupational class among retiring women: the significance of type of retirement and social and health-related factors (Journal of Epidemiology & Community Health) | Approved manuscript of article (Helda)
Higher risk of disability pension retirement among Finnish public sector than private sector employees
Retirement on a disability pension is more common in the public than the private sector. The differences are particularly high when it comes to retirement on a partial disability pension and varied by occupational group. The study was published in the Scandinavian Journal of Public Health.
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Finns’ retirement intentions keep pace with rising retirement ages
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2017 pension reform successful – retirement clearly deferred
A recent study by the Finnish Centre for Pensions shows that retirement has been deferred clearly, particularly in the private sector. Working after age 63 has also increased significantly, again particularly in the private sector. The gradual increase of the retirement age was agreed on in connection with the 2017 pension reform.
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