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The limitations of activation policies: unemployment at the end of working life

Published online by Cambridge University Press:  07 February 2011

CHRISTINA WUEBBEKE
CHRISTINA WUEBBEKE*
Affiliation:
Research Institute of the Federal Employment Agency, Nuremberg, Germany.
*
Address for correspondence: Christina Wuebbeke, Institute for Employment Research (IAB) of the German Federal Employment Agency (BA), Regensburger Strasse 104, D-90478 Nuremberg, Germany. E-mail: Christina.Wuebbeke@iab.de
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Abstract

In several European countries, older unemployed people, after reaching a certain age, are entitled to unemployment benefit payments without having to seek new employment. The coexistence of this exemption clause and of reforms aimed at containing early retirement in the respective countries reflects a conflict of political aims – on the one hand, between an efficient labour-market policy at a time of high unemployment, and on the other hand, the goal of the comprehensive activation and labour-market integration of older workers as a response to demographic change. This paper deals with the reasons for the transfer of older long-term unemployed people on to ‘facilitated benefits’ for labour-market withdrawal in Germany. The empirical analysis shows that low or no propensity to work was rarely the motive for leaving the labour market; in particular, those anticipating a low retirement income actually wanted to be re-employed. The vast majority gave three reasons for the decision to retire: an inability to cope with requirements of available jobs; a lack of job opportunities; and an absence of proper support from the public employment agency. Thus the withdrawal of older long-term unemployed people into pre-retirement cannot be attributed to a utility-maximising decision in favour of leisure and against gainful employment, but is the primary result of the scarce re-employment prospects.

Keywords

activation policiesolder workersunemploymentGermany
Type
Articles
Information
Ageing & Society , Volume 31 , Issue 6 , August 2011 , pp. 977 - 1002
Copyright
Copyright © Cambridge University Press 2011

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