10. May 2023

Pension reform: “Why Later Retirement Increases Mortality Risk” – EPoS Research Center at University of Mannheim reveals Press release: “Why Later Retirement Increases Mortality Risk”

Mannheim, Germany, 09.05.2023 – Populations are ageing rapidly worldwide: The OECD projects that the number of retirees per worker will rise by 50 percent until 2050. To cope with rising costs, governments aim to reform their public pension schemes. One of the main policy tools is to raise the minimum eligibility age. Yet, a new study by the University of Mannheim shows that removing early retirement increases the hazard of dying. “The Effect of Removing Early Retirement on Mortality” Discussion Paper is published by Cristina Bellès-Obrero, Ph.D., Prof. Sergi Jiménez-Martin and Prof. Han Ye at the EPoS Collaborative Research Center Transregio 224, a cooperation of the Universities of Bonn and Mannheim in Germany.

Pension reform: “Why later retirement increases mortality risk”– EPoS Research Center at University of Mannheim reveals
Pension reform: “Why later retirement increases mortality risk”– EPoS Research Center at University of Mannheim reveals © Han Ye
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“Our research provides empirical evidence that later retirement increases mortality,” the economists say.
“Most policymakers aim to create incentives for longer working lives to cope with ageing populations. It is
therefore highly relevant to understand the impact of delaying retirement and how to mitigate negative effects.
To that end, our research team analysed Social Security data over a long period oftime – starting before and
a*er the Spanish pension reform of 1967 which raised the early retirement age: Those contributing before 1
January 1967 maintained the right to voluntarily retire at the age of 60. Those who started contributing a*er
that date could only voluntarily claim a pension at age 65.”

Workplace conditions at the end of career matter
The results show that delaying labour market exit by one year increases the hazard of dying between the ages
of 60 and 69 by 4.2 percentage points. Depending on the working conditions during the last years of
employment, delaying retirement has different effects on life expectancy. Characteristics such as the physical
and psychosocial burden, the self-value at work and the skill level all have an influence.

Sense of achievement is important for health
The results imply that losing the right to retire early can lead to the death of individuals who work in physically
demanding jobs and who are also highly exposed to psychosocial burdens. Yet, employees who feel a sense of
achievement and recognition within their workplace do not experience a negative mortality effect. As to skill
level, delaying retirement by one year increases the probability of dying between the ages of 60 and 69 by 5.4
percentage points for blue-collar workers.

There is no “one-fits-all” solution
“These results show that there can be no ‘one-fits-all’ retirement solution,” the authors say. “We find that
policies which remove access to early retirement for the general population can exacerbate the socio-economic
disparities in life expectancy. Our results also indicate that individuals did not fully comply with the rise in
statutory retirement age. They utilized other ways to leave the labour market before claiming a regular
pension, by either claiming disability insurance or a partial pension.”

The way forward: Flexible retirement schemes
Those who had access to a partial pension experienced lower mortality rates. This shows that gradual
retirement can smooth the adverse effects of prolonged working lives. “Gradually reducing hours worked
toward the end of people’s careers is a good way forward to cope with the challenges of aging populations
while protecting workers’ health at the same,” the authors conclude.

The presented discussion paper is a publication without peer review of the Collaborative Research Center
Transregio 224 EPoS. Access the full discussion paper here. Find the list of all discussion papers of the CRC here.


Cristina Bellès-Obrero, Ph.D., Universitat de Barcelona and IZA
Prof. Sergi Jiménez-Martin, Ph.D., Universitat Pompeu Fabra, FEDEA and Barcelona School of Economics
Prof. Han Ye, Ph.D., University of Mannheim, IZA and ZEW, Collaborative Research Center Transregio 224 EPoS

Prof. Han Ye, Ph.D.
Assistant Professor of Applied Public Economics
University of Mannheim
Department of Economics
67181 Mannheim – Germany
Email: han.ye@uni-mannheim.de



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