WP 2018-392

Due to advances in computing power and the increase in coverage of longitudinal datasets in the Health and Retirement Study (HRS) that provide information about detailed occupations, demand has increased among researchers for improved occupation and industry data. The detailed data are currently hard to use because they were coded at different times, and the codeframes are, therefore, not consistent over time. Additionally, the HRS gathers new occupation and industry information from respondents every two years, and coding of new data at each wave is costly and time-consuming. In this project, we tested the NIOSH Industry and Occupation Computerized Coding System (NIOCCS) to see if it could improve processes for coding data from the HRS. We tested results from NIOCCS against results from a human coder for multiple datasets. NIOCCs does reasonably well compared to coding results from a highly-trained, professional occupation and industry coder, with kappa inter-rater reliability on detailed codes of just under 70 percent and agreement rates on broader codes of around 80 percent; however, code rates for NIOCCS for the datasets tested ranged from 60 percent to 72 percent, as compared to a professional coder’s ability to code those same datasets that ranged from 95 percent to 100 percent. In its current form, we find that NIOCCS is a tool that might be best used to reduce the number of cases human coders must code, either in coding historical data to a consistent codeframe or in coding data from future HRS waves. However, it is not yet ready to fully replace human coders.U.S. Social Security Administration, Award number RRC08098401-10, R-UM18-06https://deepblue.lib.umich.edu/bitstream/2027.42/148129/1/wp392.pd

Essays in Labor Economics.

This dissertation is composed of two essays, both which use data from original survey projects to examine issues related to work choice. The first essay examines the labor supply effects of the wealth losses during the stock market crash of 2008 and 2009. A life-cycle model incorporating both consumption and retirement timing implies that exogenous wealth losses should delay optimal retirement timing. Using data from the Cognitive Economics Study and the Health and Retirement Study, this essay quantifies the wealth losses suffered by older Americans in terms of the additional length of time they would have to work to maintain the pre-crash consumption plan implied by their wealth holdings and expected retirement timing. Using these measures, Tobit regressions and a novel method for reducing the impact of error-ridden observations are used to examine the relationship between this measure of wealth loss and retirement planning. Several potential sources of heterogeneity in individuals' reactions to the crash are also examined. Results imply that wealth losses of 2008 and 2009 are associated with an increase in planned retirement age on the order of a few weeks to a few months for the average older American, but up to several months for some segments of the population. These results are consistent with results of recent studies and the life-cycle model, but stand in contrast to other examinations of wealth shocks on the general population of older Americans. The second essay is a product of the Job Seekers Study. The essay extends Mincer's seminal theory of family migration to allow couples to adjust to migration constraints by living apart, and examine the ways in which new PhD economists adjust to migration constraints imposed on them by their spouses or partners. Both the impact of migration constraints on job outcomes and the impact of job considerations on relationship outcomes are analyzed. The essay finds that migration constraints result in small costs in terms of job outcomes, relative to many existing studies, and that adjustment through living apart is common. These results imply that existing studies may overestimate the job impact of migration constraints.Ph.D.EconomicsUniversity of Michigan, Horace H. Rackham School of Graduate Studieshttp://deepblue.lib.umich.edu/bitstream/2027.42/89744/1/bhelppie_1.pd

WP 2017-375

This study is a literature review of research related to the characteristics of second careers undertaken after mid-life. There is a significant lack of literature directly on this topic, so we draw substantially from the literatures about retirement, bridge jobs, encore jobs, and unretirement. First, we provide a working definition of second careers after mid-life. We then provide a brief background of the existing theoretical research related to this topic, which is also in need of updating and synthesis. We find evidence that second careers may already be common, but likely are undertaken by less than half of older workers. For older workers in general, job flexibility and lower stress seem to be particularly prized job characteristics that they seem willing to trade off against earnings, benefits, and prestige. However, individual fit is also likely to be particularly important in learning about second careers. We also find useful information in studies of specific early-retiring occupations and destination second careers. Based on the existing general, late-life labor supply literature and specific occupation literature, we propose new directions for research. An important take-away is that data limitations have been a roadblock; however, forthcoming resources may help open up this area of research.Social Security Administration, RRC08098401-09, R-UM17-Q2https://deepblue.lib.umich.edu/bitstream/2027.42/142390/1/wp375.pdfDescription of wp375.pdf : Working pape

WP 2015-331

Population aging and attendant pressures on public budgets have spurred considerable interest in understanding factors that influence retirement timing. A range of sociodemographic and economic characteristics have been shown to predict both earlier and later retirement. Less is known about the role of occupations and their characteristics on the work choices of older workers. Knowing more about the occupations that workers seem to stay in longer or leave earlier may point the way to policy interventions that are beneficial to both individuals and system finances. This project uses detailed occupational categories and work characteristics in the Health and Retirement Study (HRS) linked to information in the Occupational Information Network (O*NET) to examine compositional changes in occupations held by older workers over time; to provide some basic and interesting information about relationships between occupations and their characteristics and retirement expectations and outcomes; and to shed some light on which occupations and associated characteristics might encourage or discourage longer working lives. There are large percentage changes (increases in decreases) in the percentage of older workers in occupations over time. Considering detailed as opposed to aggregated occupational categories yields interesting additional information. Jobs that HRS respondents say entail less physical effort, less stress, and jobs that have not increased in difficulty in recent decades, and those in which people can reduce hours if desired, are associated with longer work. While the traditional blue collar-retire earlier and white collar-work longer associations emerge, we find interesting exceptions that suggest fruitful directions for future research.Social Security Administration5 RRC08098401-07http://deepblue.lib.umich.edu/bitstream/2027.42/117396/1/wp331.pd

Crash and Wait? The Impact of the Great Recession on the Retirement Plans of Older Americans

This study uses data from pre- and post-crash surveys from the Cognitive Economics study to examine the impact of recent stock and labor market wealth losses on the planned retirement ages of older Americans. Regression estimates imply that the average wealth loss between July 2008 and May/June 2009 is associated with an increase in planned retirement age of approximately 2.5 months. Furthermore, pessimism about future stock market returns is found to amplify the impact of wealth losses on retirement timing.

The Relationship Between Adverse Experiences Over the Life Course and Early Retirement Due to Disability

A growing body of research implicates life span adversity in later-life outcomes. We use data from the Life History Mail Survey (LHMS) with data from the Health and Retirement Study (HRS) core surveys to examine the relationship between adverse experiences over the life course and retirement due to disability. We employ 31 measures of childhood and adulthood adversities in both the financial and social domains. We create three measures of retirement due to disability based on survey responses to questions about health as a reason for retiring and the extent to which health limits work ability. For each measure of early retirement due to disability, we perform competing risk survival analysis modeling these outcomes relative to continued work or retirement for any other reason. We conduct these analyses in four samples depending on the component of the survey the data from which the data derived, with the sample including LHMS information being the most restricted but including the greatest number of adversities. Cumulative life adversity was associated with all outcomes examined, including the most conservative specification of disability retirement (i.e., retirement in the context of a health problem that completely limits work) and across all samples. We also found that childhood financial adversity and adult social adversity were most consistently associated with an increased hazard of retirement due to disability in our analysis, which balances the greatest number of adversities with a reasonably large sample (Sample 3).U.S. Social Security Administration, RDR18000002-03, UM21-07http://deepblue.lib.umich.edu/bitstream/2027.42/171806/1/wp435.pdfDescription of wp435.pdf : working paperSEL

WP 2016-352

Given the clear benefit for both public and private finances of extending work lives, many policymakers are interested in finding and promoting ways to accomplish this objective while balancing concerns for work ability at older ages. At the same time, retirement itself is transforming from a simple transition from full-time work to full and permanent retirement to more of a process, potentially occurring in several stages over a number of years. We consider a set of work transitions at ages when the largest numbers of people are retiring and potentially pursuing different paths to full and permanent retirement. Among workers who transition between occupations, the most common transitions are between those that are closely related. However, even within closely related occupations, there are no large pipelines between any two. By age 62, 57 percent of workers are no longer in the labor force, 26 percent are still in their “career” occupation, and 17 percent have changed from their career occupation to another occupation. Beginning at age 66, however, the percentages in different occupations, which may be bridge employment or unretirement, are very similar to the percentages remaining in career occupations. Occupational changes later in life tend to be accompanied by decreases in hourly earnings, suggesting that if workers are seeking flexible or part-time bridge employment, it may come at a cost.Social Security Administration, RRC08098401, R-UM16-03http://deepblue.lib.umich.edu/bitstream/2027.42/135724/1/wp352.pd

Financial profiles of workers most vulnerable to coronavirus- related earnings loss in the spring of 2020

In the spring of 2020, the COVID- 19 pandemic and related shutdowns had huge effects on unemployment. Using data from the Survey of Consumer Finances, we describe the financial profiles of US families whose workers were most vulnerable to coronavirus- related earnings losses in the spring of 2020, based on whether a particular worker was deemed - essential- and whether a worker’s job could be conducted remotely. We use descriptive analytic techniques to examine how families’ baseline financial situations would allow them to weather COVID- shutdown- related earnings losses. We find that families with non- teleworkable workers who were most vulnerable to layoff also had both demographic and financial profiles that are associated with greater vulnerability to income shocks: non- teleworkable families were more likely to be people of color and single wage- earners, and also to have less savings. The median non- teleworkable family, whether in non- essential or essential occupations, held only 3- weeks of income in savings, underscoring the importance of policy measures to blunt the financial effects of the COVID crisis.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/166202/1/cfp21102_am.pdfhttp://deepblue.lib.umich.edu/bitstream/2027.42/166202/2/cfp21102.pd

Heaping at Round Numbers on Financial Questions: The Role of Satisficing

"Survey responses to quantitative financial questions frequently display strong patterns of heaping at round numbers. This paper uses two studies to examine variation in rounding across questions and by individual characteristics. Rounding was more common for respondents low in ability, for respondents low in motivation, and for more difficult questions, all consistent with theories of satisficing. Questions that require more difficult information retrieval and integration of information exhibit more heaping. The use of records, which lowers task difficulty, reduces rounding as well. Higher episodic memory is associated with less rounding, and standard measures of motivation are negatively associated with rounding. These relationships, along with the fact that longer response latencies are associated with less rounding, all support the idea that rounding is a manifestation of satisficing on open-ended financial questions. Rounding patterns also appear remarkably similar across the two studies, despite being fielded in different modes and employing different question order and wording." (author's abstract

Incentives for Home- and Community-Based Care Under the Affordable Care Act: Implications for SSI Receipt

This paper examines whether and in what ways the Balancing Incentives Program (BIP) changed living arrangements and SSI receipt.One in three 65-year-olds will require long term care at some point in their lives. Most nursing home stays cost over $3,500 a month, an expense that eventually exhausts the financial resources of most families. Medicaid currently covers these expenses for 6 out of 10 nursing home residents. Not all those who require care need enough help to justify moving into a nursing home, but in many states Medicaid will not pay for care received at home. In these states, moving into a nursing home is the only way to get help paying for care. The Balancing Incentives Program (BIP), which is part of the Affordable Care Act, encouraged states that spend most of their Medicaid dollars on nursing home care to adopt programs and practices that extend coverage for care while living at homes, living with relatives, or living in assisted living facilities. In participating states, the BIP may have enabled some elderly to return to home and community settings or prevented them from needing to move into nursing homes. When living outside of a nursing home, low income elderly may also be eligible for Supplemental Security Income (SSI) payments. SSI is income assistance available to financially needy elderly, disabled and blind persons living in the community. People living in nursing homes are generally not eligible for SSI. Our project will examine whether and how the BIP changed living arrangements and receipt of SSI. It is a first step towards understanding whether the BIP improved the lives and well-being of economically-disadvantaged elderly adults. If changes in living arrangements are found, future work will examine the impact on the health of those affected and on relatives who may be providing or coordinating their care.Center For Financial Security, Retirement & Disability Consortium, U.S. Social Security Administratio