Research on Retirement

An extension of working lives requires a rise in the average effective retirement age. Therefore it is important that we study the routes to retirement. At the Finnish Centre for Pensions, we monitor and study the frequency and the effects on retirement of the new pension types: the years-of-service pension and the partial old-age pension. We also need data on the financial incentives of the pension system and how they affect the different population groups. In addition to the effective retirement, we also review the retirement intentions of the population and how employers relate to, for example, the employment of the elderly.

The working life of many ends when they retire on a disability pension. The number of starting disability pensions has decreased in recent years, while the number of partial disability pensions and cash rehabilitation benefits has increased. We also study the differences between population groups regarding the disability pension risk in various disease categories and the connection between retirement and health, work ability as well as working conditions.

In recent years, working while drawing a pension has become increasingly common. We produce data on the frequency and development of working while receiving a pension. In addition, we examine the pension reforms of other countries and how these reforms have affected the retirement age.

Current research projects

Employer role in work-to-retirement transition

Aim: People retire at a later age in the public sector but not in the private sector. The aim of this study is to find out in which types of private sector workplaces people retire late and in which early. The studied private sector companies in which wage earners retire early employ more than 10 people. We examine the organisations’ structural characteristics and how they impact retirement, taking individual-level features into account. Structural characteristics refer here to relatively stabilized and slowly changing features of the employer organisation, such as the age structure and educational level of the organisation, company size and field of business. We examine the link between these characteristics and circumstances of the competing routes of retirement (disability pension, unemployment and old-age pension) between the 2005 retirement form until 2014.

Realisation: We use FLEED employer-employee data. The research population are people born between 1947 and 1950 who work in the private sector in companies that employ at least 10 persons. We monitor them between the ages of 55-68 or until they retire. In addition to a descriptive review we use multilevel and survivor models.

Schedule: 2018–2019

Researchers: Aart-Jan Riekhoff, Noora Järnefelt, Mikko Laaksonen

How often do partial disability pensions become full disability pensions?

Aim: Prolonging working lives has been a central sociopolitical goal for the last twenty years A majority of those who draw a partial disability pension continue working. Few of those who get a full disability pension work. Relatively little is known about how often partial disability pensions become full disability pensions. In this project, we investigate how often partial disability pensions become full partial disability pensions and for how long people draw partial disability pensions. In addition, we investigate which individual-level factors are linked to a partial disability pension becoming a full disability pension.

Realisation: Register data of the Finnish Centre for Pensions (+ TURE [VTT Technical Research Centre of Finland Ltd])

Schedule: 2019–2020

Researchers: Anu Polvinen, Mikko Laaksonen

Impact of company-level factors on retirement on a disability pension

Aim: Workplaces can take various measures to prevent and defer their employees’ retirement on a disability pension. In this study, we examine the importance of company-level risk factors on retirement on a disability pension and occupational rehabilitation. Our research questions include the following:

  • do employer-level factors make a difference on retirement on a disability pension when the individual-level factors have been taken into consideration, and
  • which register-based structural features that describe the employers may be connected to retirement on a disability pension.

Realisation: Sample of workplaces and their employees drawn from the register data of the Finnish Centre for Pensions. The data will be combined with the data on retirement on a disability pension. We use multilevel analysis to examine the associations of workplace-level factors to retirement on a disability pension.

Schedule: 2017–2019

Researchers: Mikko Laaksonen, Jyri Liukko, Juha Rantala, Anu Polvinen, Meeri Kesälä, Jarno Varis, Susan Kuivalainen

Register study of time before a disability pension, II

Aim: In order to reduce the number of starting disability pensions, it is important to know which factors contribute to the likelihood of retirement on a disability pension and which routes lead to retirement. The aim of this study is to use extensive, nationally representative data to produce current information on the events and development that lead to retirement on a disability pension. The study is a continuation of a project that ended in 2015 in which we studied what happened before retirement on a disability pension, that is, periods of sickness allowance, rehabilitation and unemployment.

Realisation: The study is based on data that combines the register data of the Finnish Centre for Pensions and Kela.

Schedule: 2016–2020

Researchers: Mikko Laaksonen, Anu Polvinen (Finnish Centre for Pensions); Jenni Blomgren, Annamari Tuulio-Henriksson, Lauri Virta, Karoliina Koskenvuo, Hannamari Heinonen (Kela); Laura Salonen (University of Turku)

Retirement intentions and actual retirement based on Quality of work life survey

Aim: This study reviews to which degree the retirement intentions and the actual retirement correspond, as well as which factors explain the intentions and the actual retirement. The study is based on the Quality of work life survey 2008, supplemented with register data of the Finnish Centre for Pensions and Statistics Finland. The study focuses on 50-62-year-olds.

Realisation: Literary and econometric review.

Schedule: 2019

Researchers: Satu Nivalainen, Noora Järnefelt

The Finnish pension reform of 2005 – The effect of relabelling and incentives on retirement

Aim: In this study we review how the economic incentives affect the retirement age and how the renaming of the  retirement contingency affect the retirement age (for example, before 2005, retirement at age 63 was ‘early retirement’ while, after the 2005 reform, 63 years was the ‘regular old-age retirement age’).

Realisation: The empirical part of the study is based on a total sample compiled from the register data of the Finnish Centre for Pensions of 50–70-year-old Finnish citizens in 2000–2015.

Schedule: 2017–2019

Researchers: Ohto Kanninen, Terhi Ravaska (Labour Institute for Economic Research), Jonathan Gruber (MIT), Roope Uusitalo (University of Helsinki), Satu Nivalainen (Finnish Centre for Pensions)