Factors determining early exit from employment

A qualitative research study carried out by the Employment and Training Corporation in 2007 evaluated the factors influencing individuals’ decisions to exit employment before reaching the statutory retirement age. The study was conducted among 30 men aged 55–60 years who were neither working nor registering for work at the time of the study. Poor working conditions were found to be among the main factors pushing older workers out of employment earlier than expected.

Background to study

A study on ‘Early exit from employment’ was conducted by the Monitoring and Evaluation Unit of the Employment and Training Corporation (ETC) in 2007. The main aim of the study was to assess the key factors influencing the early retirement choices of older workers. The report aimed to contribute to a better understanding of the experiences of Maltese men who retire early from work. In turn, the ETC hoped to use this information to provide better employment and training services to its clients. Until a few years ago, both the government and private employers used early retirement as an option in restructuring exercises in an effort to reduce their workforce. However, the government appears to have ceased this practice in line with the Lisbon Strategy objective of increasing the number of older workers in the labour force. Until recent times, another reason for the promotion of early retirement was the negative attitude of some employers towards older employees. In this regard, employers believed that older workers resisted change and had limited skills and abilities to deal with increased pressure at work.

About the study

The research participants comprised 30 men aged between 55 and 60 years, who were neither working nor registering for work – that is, not trying to find employment with the help of the public employment service – during the period of the study. All participants represented different economic sectors and backgrounds to ensure maximum variation sampling. Semi-structured in-depth interviews were conducted among the participants. The data collected was used only for research purposes and the participants’ personal details remained confidential.

Five main themes were analysed as part of the research from the perspective of the retired employees, including:

  • attitudes towards work: the level of activity, sense of responsibility, opportunities to learn and continuous training, and financial stability;
  • working conditions: flexibility options, working hours, remuneration, relationships at the workplace, loyalty towards the organisation, and health and safety practices;
  • personal circumstances: whether the survey participant is the sole earner in the household, physical health, marital status, family death or illness, and responsibility for disabled children;
  • level of education and skills: the training a worker receives at the workplace, participation in training courses, as well as colleagues’ opportunities for training;
  • perceptions of the new lifestyle that comes with retirement: issues such as having control over one’s retirement, preparing mentally and financially for the change in life circumstances, finding new interests to fill one’s free time, increase in family and home responsibilities, and the effects of change on the participant’s spouse.

Main findings

The research revealed a number of both positive and negative factors influencing employees’ decisions to retire early. Positive factors included attractive retirement packages and financial security. Negative factors ranged from forced redundancy, health problems and inferior working conditions – such as engaging in part-time work often for low pay – to no holiday or sick leave. Other reasons cited by participants for taking early retirement included the level of pressure at work and the fact that their partner was employed, hence offering financial stability. Furthermore, some participants reported that their children had already grown up and left home, in which case the older workers felt that there was no specific reason for them to continue working.

Some participants described their case in positive terms. For example, after considering the ‘pros and cons’ of their situation, a number of participants concluded that they would be better off taking up the offer of early retirement. On the other hand, other participants described the experience of retiring as a difficult time and as a situation that they were forced into. Most of the reasons pushing employees towards retirement were health related – for example, loss of sight, psychological problems due to increased stress from one’s superior in the workplace and physical limitations to carry out the work required.

Participants’ views on early retirement were both positive and negative. However, only a few participants reported negative experiences in relation to retiring early. The majority associated early retirement with having more time to enjoy family life and other activities of interest to them. The few participants who described their experience as negative reported that their unemployment had stripped them of their identity or led to financial constraints. In some cases, these workers suffered from depression, thus affecting their relationship with the family.

Conclusions

The study did not attempt to quantify or prioritise the factors influencing employees’ decisions to take early retirement. However, it concluded that participants who attributed their early retirement to positive factors tended to be more satisfied with their decision to leave work early and with their retired life than those participants who felt they were forced out of the labour market due to difficult situations that they found themselves in.

The ETC highlighted its commitment to use the results of the survey to improve and extend its services for older workers and expressed a wish that other stakeholders would do the same.

Christine Farrugia, Centre for Labour Studies

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