Factors predicting voluntary and involuntary workforce transitions at mature ages: Evidence from HILDA in Australia

Abstract

The fast population ageing has generated and will continue to generate large social, economic and health challenges in the 21th century in Australia, and many other developed and developing countries. Population ageing is projected to lead to workforce shortages, welfare dependency, fiscal unsustainability, and a higher burden of chronic diseases on health care system. Promoting health and sustainable work capacity among mature age and older workers hence becomes the most important and critical way to address all these challenges. This paper used the pooled data from the longitudinal Household, Incomes and Labour Dynamics in Australia (HILDA) survey 2002-2011 data to investigate common and different factors predicting voluntary or involuntary workforce transitions among workers aged 45 to 64. Long term health conditions and preference to work less hours increased while having a working partner and proportion of paid years decreased both voluntary and involuntary work force transitions. Besides these four common factors, the voluntary and involuntary workforce transitions had very different underlying mechanisms. Our findings suggest that government policies aimed at promoting workforce participation at later life should be directed specifically to life-long health promotion and continuous employment as well as different factors driving voluntary and involuntary workforce transitions, such as life-long training, healthy lifestyles, work flexibility, ageing friendly workplace, and job security.