Ageing Of The Workforce: Effects On The Labour Market With Participation And Retirement

Abstract

Ageing of the work force in New Zealand is an important determinant of labour market dynamics. In addition to the median age and the proportion of workers in retirement age, the nature of occupations and health and financial security are also important determinants of participation and retirement.

The baby boom generation has approached their retirement years and the age structure of the working age population has also significantly altered. Consequently, the retirement of older workers is expected to make-up an important source of new job openings over the coming decades.

Estimating and forecasting likely future retirement rates by occupational groups is of considerable interest, and provides further insights into labour market dynamics.

In this study, recent historical retirement rates for broad (3-digit) ANZSCO occupational groups were derived using an internationally accepted methodology known as the cohort component method, adapted to allow for some participation by older age groups. Occupational employment data by age extracted from the recently released 2013 Census was analysed along with the corresponding data from the 2006 Census to estimate the average retirement rates over the 2006-13 period. These rates are then used to project future retirement rates over the 2013-20 period for the same broad occupational groups. Projections were based on the Working Age Population projections for age groups and their associated participation rates.