The Length of Working Life in Spain: Levels, Recent Trends, and the Impact of the Financial Crisis

Fernando G Benavides,Christian Dudel,María Andrée López Gómez,Mikko Myrskylä

doi:10.1007/s10680-017-9458-9

Abstract

While there has been considerable debate about extending the length of working life, relatively little is known about this issue. We use data from the Spanish Continuous Working Life Sample for 2004–2013 to calculate period working life tables, which in turn allows us to assess the impact of the financial crisis on working life expectancy in Spain. Before the recession hit, working life expectancy in Spain was around 38 years for males and 33 years for females. The recession had a tremendous impact on the Spanish labor market, but the effects differed considerably by gender and occupational category. Men working in skilled non-manual jobs were less affected, while men working in unskilled manual jobs lost close to 14 years of working life expectancy. Women were less affected than men. With working life expectancy decreasing, the average proportion of lifetime spent in unemployment and outside the labor market increased markedly, whereas the average number of years spent in retirement changed only a little. When we decompose losses in working life expectancy by age group, we find that economic fluctuations affect both older and younger workers. This result suggests that policies that focus on retirement ages only are incomplete. We also compare our findings to the results obtained by Sullivans method, which is based on prevalence rates rather than the incidence-based working life table approach. We find that the use of Sullivans approach does not accurately reflect the levels of and the trends in working life expectancy.

Highlights

Population aging will put a strain on social security systems in developed countries in the near future
Before we break down working life expectancy (WLE) by occupational category, we present findings for the total male and the total female population, which give an overview of the general trends in Spain
As the recession hit Spain in 2008, 2007/2008 can be seen as a ‘‘mixed’’ period, which arises from using year-toyear transitions, while the years before this point can be viewed as a pre-crisis period, and the years after this point can be seen as a period marked by recession

Summary

Introduction

Population aging will put a strain on social security systems in developed countries in the near future. The statutory retirement age has been raised in several countries (OECD 2015). More research is needed on the expected length of working life, including on the questions of how working life expectancy (WLE) developed in the past, which factors influence WLE, and how WLE differs by country and region (Dudel and Myrskyla 2016). Young people have been especially vulnerable to the consequences of the crisis, and youth unemployment in Spain has risen considerably (Dolado et al 2013). The long-term youth unemployment level has increased, but is low compared to the overall level of unemployment, and compared to the levels in other European countries (O’Higgins 2012)

Methods

Results

Discussion

Conclusion