Whoopee!! It’s Super Tuesday and to celebrate we have a post describing a paper looking at whether Americans are healthy enough to keep working longer than current retirement ages, a very timely subject since it seems not one of the pack of morons we apparently must select our next president from has a clue about how to address the deficit and debt problems that will soon overwhelm our ability to sustain Medicare and Social Security. (NBER Paper) Social Security’s eligibility age was already moved out a few years ago, but for both programs the possibility of increasing the age of eligibility further has been put forth as a potential solution to the pending funding crisis. Life expectancy has risen dramatically since the passage of Social Security and even since Medicare was enacted. That creates significant additional liability for both programs as people receive benefits for a longer period of time, but aren’t paying in for more years.
The authors look at comparative mortality rates and at comparative health levels across cohorts to model how long older workers might be able to remain in good enough health to continue being employed. The mortality rate analysis suggests men could work an additional 4 years compared to 1977. The health status analysis suggested that both men and women could work about an additional 2.5 years. The additional work capacity change is about the same for men across all levels of educational attainment but rises for women as their educational level increases. Over time, self-reported health status at various ages has also improved, another indication that people might be able to work longer. Of course, this may depend on what occupation a person has–construction workers may have a harder time working into old age than an office worker. This suggests that if we really begin to expect people to work longer we may need to offer retraining for certain professions. And while my opening sentence may seem sarcastic or fanciful, given the state of Medicare, Social Security and various state employee retirement programs, workers should definitely prepare for the worst.