COGNITIVE FUNCTIONING IN LABOR FORCE TRANSITIONS

This application seeks support for a secondary analysis of three waves of the Health and Retirement Study (HRS) that measure cognitive functioning and employment status over a six-year period among a nationally representative sample of pre-retirement-age Americans. Many studies in recent years provide evidence that deterioration in physical health is the primary determinant of early retirement from paid work. Far less attention has focused on the extent to which cognitive functioning may affect exists from work. Given changes in the labor market in recent decades, optimal cognitive functioning may be as important, and in some case not more important, a prerequisite for continuing employment as good physical health. The primary focus of the proposed research is to examine the extent to which changes in cognitive functioning affect the transition from paid work to retirement. Specifically, it aims to answer two questions: What are the cognitive antecedents of retirement? And, what are other health antecedents of retirement? The specific objectives are: (1) to estimate the effects of changes in cognitive functioning as well as other measures of health (e.g., physical illnesses, sensory impairments, and depressive symptoms), net of other individual sociodemographic and job- related characteristics, on the move from paid work to retirement between 1992 and 1996, among older adults who were current workers in 1992; (2) similarly, to estimate the effects of changes in spousal cognitive functioning and other measures of health on the move to retirement; and (3) to discern whether these effects differ by gender or ethnic minority category, where possible. The principal investigator expects to follow up on this proposed study with future examinations of the effects of changes in spousal and family (as well as respondent) characteristics other than health as an important part of the joint decision-making process hypothesized to be taken by couples as one or both move(s) from paid work to retirement. In addition, she expects to explore the extent to which differential pre-retirement characteristics such as cognitive functioning interact with retirement to influence both post-retirement behaviors and economic security.