Transition From Work to Retirement: Evidence from LEED

Abstract

Survey evidence suggests that the majority of New Zealanders would prefer to make a gradual transition from work to retirement, rather than move abruptly from full-time work to non-employment. This study describes the employment patterns and transitions of people who were aged in their 60s and moved from wage or salary employment to inactivity during the 1999-2005 period, using longitudinal data from the Linked Employer-Employee Dataset. Four different types o f transition to retirement were defined and the relative frequency o f each explored. We find that phased transitions, involving either part-time work or a number of transitions in and out of employment before the final exit, were far more common than discrete transitions from full-time work to non-employment. Men were more likely than women to take a traditional path from work to retirement. There were some significant variations in the frequency of different work-to-retirement paths across major industries, but phased transitions were more prevalent than traditional in all major industries.