Postponing Retirement Age: Are People with Health Issues More at Risk to Be ‘Neither Employed nor Retired’? Evidence from France.

Mira Rahal , PjSE
Cimelli Léa, INED
Emmanuelle Cambois, INED

Background. In response to population ageing, many OECD countries have raised statutory retirement ages to sustain their pension systems. In France, the 2010 pension reform unexpectedly increased the statutory eligibility age (SEA) from 60 to 62. While it extended working lives, it also led to more early exits through unemployment, disability pensions, and inactivity, grouped under the category “Neither Employed Nor Retired” (NENR). This study investigates whether such effects differed by health status, focusing on histories of depression, osteoarticular diseases (OSD), and cardiovascular diseases (CVD), which are strongly linked to disability and early labor market exit. Methods. We use administrative records from the French National Pension Fund (CNAV), linked with medical data from the CONSTANCES cohort. A difference-in-differences (DiD) design is applied to cohorts born between 1948 and 1953 (22,324 individuals), comparing employment, NENR, and retirement rates between those unaffected by the reform (born before July 1951) and those affected (born after). Interactions between disease histories and the DiD estimator test for heterogeneous effects. Results. Before the reform, individuals with either history of depression, OSD, and CVD were less likely to be employed and more likely to be NENR prior to retirement. The reform increased employment around age 60 but also raised rates of NENR, with stronger effects among individuals with disease histories. The interaction between depression and a higher likelihood of NENR remained robust across multiple checks. Conclusion. Health plays a key role in shaping responses to postponed retirement ages. Depression, in particular, deserves targeted consideration in policy design.

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 Presented in Session 65. Policy Issues on Ageing: Employment, Pensions and Public Perceptions