An Alternative to Retirement: Part-time Work
Part time work can facilitate participation in the labor market and smooth the transition to retirement. Part-time employment, however, represents for the most part an involuntary choice. The aim of this paper is to conduct an empirical investigation of the determinants of part-time work. Using Spanish labor market data, we find that parttime work becomes a more desired employment alternative as people age, and that education and children’s age have opposite effects on women and men’s probabilities of voluntary part-time employment. Interestingly, most part-time work among women occurs in low-skill occupations, whereas part-time work among men are mainly concentrated in high-skill jobs
Part time work can offer a variety of benefits for the problems faced by aging societies. First, it can be used as an instrument to facilitate participation in the labor market and smooth the transition to retirement. Second, it can be complementary tool to policies that want to extend the legal retirement age. Third, it can be key to rise government’s revenues. Within this context, a main issue that the policymaker faces is to create attractive conditions in part-time employment to make it a desired option to retirees; the existence of disadvantageous labor contract conditions often associated to part-time jobs limits the extent of part-time jobs as a voluntary choice.
Part-time work as a form of partial retirement is already a possibility in many nations. In countries like, for example, the United States about 18% of the cohort of workers born between 1931 and 1941 were in phased or partial retirement in 1998 and 2000 (Scott 2004). In Europe, part-time work programs for retirees have also been implemented; in the Netherlands, for example, about one-third of employees said their last employer offered the possibility of phased retirement (Van Soest et al. 2006). In Spain, about 25.5% of men employed that are 65 years old and over work part-time; among women the percentage is 38.2.