The changing state pension age: Health impacts and ability to remain in employment

Abstract

The main research questions examined in this thesis concern the interaction between an increasing State Pension Age (SPA) and health in the UK. The conclusions drawn from this investigation cast further light on the equality of an increasing SPA, including whether individuals in different circumstances will be able to continue working until reaching retirement age. In particular, this research suggests that inequality and the social gradient of health should be taken into account when designing a policy as influential as the State Pension.

To explore the relationship between continued employment and health, a Dynamic Microsimulation Model is constructed. This projects individual health trajectories using English Longitudinal Study of Ageing data onto a representative Census base population. Within this framework, current and counterfactual SPA policy scenarios are used to assess the relative impact. This thesis furthers our understanding of the impact that the currently legislated SPA policy may have over the next 30 years.

The study found a decline in overall health within the population of the UK throughout life. Each year the SPA was delayed resulted in an increasing proportion of individuals projected to fall into poor health before reaching the SPA. The results indicate that those in lower NS-SEC groups experiencing poor health at significantly earlier ages. This was found to be likely to lead to a much larger proportion of those in low NS-SEC groups experiencing difficulty remaining in employment before reaching SPA than their high NS-SEC group counterparts. The level of feedback between employment status and health was additionally found to be influential when defining the impact of a SPA change. It was found that if employment leads to an improvement in health, additional working years might protect individuals from an overall decline in health. If however continued employment is detrimental to health, declines in health may be exacerbated, leading to a rapid reduction in health state when nearing SPA.

It was identified that allowing individuals to retire following 45 years of contributions has the potential to significantly decrease the number of individuals falling into poorer health while being under SPA. Conversely, the 50 years of contributions suggested by the Cridland (2016) Independent Review of the State Pension Age was found to pose little benefit in this regard. The health measure utilised was found to be influential when assessing the impact of policy. The study utilised the subjective Self-Reported Health measure, as well as an objective Hand-Grip Strength measure. Significantly different results were obtained, dependent on both the measure of health used and the manner in which conceptualisations of health were made.

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Identifiers

ORCID for Athina Vlachantoni: orcid.org/0000-0003-1539-3057

ORCID for Jane Falkingham: orcid.org/0000-0002-7135-5875

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