Labour market trajectories and unemployment of older workers in Europe after the Great Recession

Abstract

Many European countries want to overcome the early exit from labour market which was widespread since the 1970s through pension reform and labour policies. The extension of working life is hindered by factors that the literature overlooks. This article focuses on the discontinuity of the late‐career caused by unemployment. The aim is to investigate whether older workers are at risk of unemployment and what are the transitions after spells of unemployment. The labour market trajectories of workers over 50s in 11 European countries from 2006 to 2019 were analysed, specifically after the Great Recession and before the Covid‐19 epidemic. It is based on longitudinal survey data from the generated Survey of Health, Ageing and Retirement in Europe Job Episodes Panel. Event history analysis and sequence analysis were performed. Older employees are unlikely to face unemployment. The transition rate highlights the difficulty for older workers into re‐employment. A low education level increases the risk of unemployment and remaining unemployed. Data by country confirm the trend towards overcoming the transition from unemployment to early exit. Divergences concern the higher risk of being trapped in unemployment in Southern European countries such as Greece and Italy.