Should I care or should I work? The impact of working in older age on intergenerational support

Summary

At a time when governments in ageing societies are raising the retirement age to increase the labour supply of older workers, new research by Ludovico Carrino, Vahé Nafilyan and Mauricio Avendano Pabon suggests that the net gain arising from increased employment may be smaller than anticipated. This is because of a reduction in older workers’ ability to provide intergenerational care support for their parents.

Their study finds that women in the UK who work more hours due to the increase in their state pension age substantially reduce informal caregiving to older parents, who receive less overall care as a consequence. The reduction in the supply of care for older people is expected to lead to higher unmet need, increasing the demand and costs for health services later in life.