Working Conditions, Health and Reward at Work of European Older Workers

1
Working Conditions, Health and Reward at Work
of European Older Workers
Workshop on Working at old age Emerging
theories and empirical perspectives on ageing and
work CEDEFOP September, 29-30 2008,
Thessaloniki

• Thierry Debrand (), Pascale Lengagne ()
• () debrand_at_irdes.fr () lengagne_at_irdes.fr
• Institute for Research and Information in Health
  Economics, Paris

2
Introduction

• Problems in Retirement Financing gt Employment
  rate of older workers
• Providing financial incentives for firms or
  individuals
• These measures have their limits. In particular
  if older workers are not satisfied with the
  reward they receive at work, maybe they will
  always prefer retiring as soon as possible.
• Looking more precisely at the notion of reward
  at work among older workers
• Focus on two determinants of reward at work
• Working conditions and Health status

3
Introduction

• Survey on Health Ageing and Retirement in Europe
  (SHARE)
• carried out in 20042006
• Defining the notion of Reward at work
• The feeling of receiving the recognition
  deserved
• Having adequate salary relatively to the effort
  realised
• Having good prospects for job advancement

4
Introduction

• Hypotheses, Data, Statistical methods
• Results
• Policy implications and conclusions

5
Hypotheses

• Hypothesis 1 Existence of wage differentials for
  risky jobs
•  Are older workers having risky jobs
  sufficiently rewarded for these risky
  conditions? 
•  Is this hypothesis true within all
  socioeconomic groups? 
• Hypothesis 2 Impact of health on reward at work,
  in the long run
• Health status, as part of human capital (Becker,
  1964 Grossman, 1972 Currie and Madrian, 1999),
  influences workers productivity, income, labour
  participation
• Long run  poor health status  gt lowest
  socioeconomic position, lowest reward at work
• Hypothesis 3 Impact of reward at work on health
•  Effort-reward imbalance model (Siegrist,
  1996) Imbalance between reward and effort at
  work is a source of psychosocial risk on the
  long run, it can lead to health problems gt
  Self-assessed health status, cardiovascular
  diseases, depressivity, musculoskeletal
  disorders.
• See also Debrand, Lengagne (2007)

6
Data
7
Data

• Survey on Health Ageing and Retirement in Europe
  (SHARE) carried out in 2004 (first wave) and 2006
  (second wave)
• 30,000 people aged 50 and over, living in eleven
  European countries Austria, Belgium, Denmark,
  France, Germany, Greece, Italy, the Netherlands,
  Spain, Sweden and Switzerland.
• SHARE is inspired by similar surveys in the
  United States and in the UK the Health and
  Retirement Survey (HRS) in the United States and
  the British panel ELSA (English Longitudinal
  Survey on Ageing).
• The topics considered are of particular interest
  to several disciplines health, psychology,
  economics or sociology.
• Free access for all researchers!
  www.share-project.org

Our sample 3 273 workers aged between 50 and 63
in 2004, still working in 2006 Détails on this
sample 10 410 persons between 50 and 63 in
2004 6 475 of them was working in 2004 6 475
3 273 persons who was working in 2006
744 persons who was not working in 2006
2 458 persons lost
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Data

• Selection effects ?
• Socioeconomic factors associated with the
  probability of being surveyed two years later

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Data

• Indicator of reward at work (between 3 and
  12)
• Reward Receiving the recognition deserving
  for my work (1 to 4)
• My salary or earning are adequate (1 to 4)
• Having good prospects for job advancement
  (1 to 4)
• Low 34 in 2004 33 in 2006
• Intermediate 43 in 2004 44 in 2006
• High 23 in 2004 23 in 2006
• Transitions ?
• 45 of low rewarded person in 2004 declare a
  better reward 2 years later
• 25 of intermediate levels declare a low reward
  2 years later
• 21 of intermediate levels declare a high reward
  2 years later
• 35 of high levels declare an intermediate
  reward 2 years later
• 13 of high levels declare a low reward 2 years
  later
• Indicator of health status Self-assessed
  health status

10
Statistical Methods
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Method (1/2)

• First step Correlations between WC and Reward
  at Work
• gt our first hypothesis
• M1 Random-effects regression model
• gt No control for individual time-invariant
  unobserved differences
• (for instance risk aversion, contextual and
  cultural time-invariant variables )
• M2 Regression model where regressors are
  correlated with errors
• gt Control for individual time-invariant
  unobserved differences

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Method (2/2)

• Second step Analysis of the causalities between
  Health and Reward at work
• (gt our second and third hypothesis)
• M3 We have estimated a structural model to
  study the impact of reward at work on health
  status. Our IV is the firms size.

13
Results
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Correlations (First step)Working Conditions and
Reward at Work?
When time-invariant differences are not
controlled (Model M1) A lack of reward is
associated with risky jobs (time pressure or
physically demanding job). When time-invariant
differences are controlled (Model M2) No
association between time pressure and reward gt
In our sample, compensation for time pressure
is not rejected. Significant association between
physically demanding jobs and reward gt
compensation for physically demanding job is
rejected. Standard deviation in
parentheses Significant at 1 NS
non significant
15
Correlations (First step)Working Conditions and
Reward at work?
Are our last results consistent within all
socioeconomic groups? An exploration of several
socioeconomic groups leads us to isolate four
groups
16
Correlation (Second step)Health and Reward at
Work?
When time-invariant differences are not
controlled (Model M1) A lack of reward at work is
correlated with a poor self-assessed health
status. When time-invariant differences are
controlled (Model M2) A lack of reward at work is
not significatively correlated with a poor
self-assessed health status. gt If the
relationship between health and reward at work
exists, it is a long run relationship.
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Analysis of causalities (Second step)Between
Health and Reward at Work
Estimation of the structural model
18
Conclusion
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Conclusion (1/2)

• Reward at Work and Health of European older
  workers
• We have found no effect of self-assessed health
  status on reward at work
• gt Productivity of people who stay at work does
  not seem to be influenced by their health status
• But Healthy worker biais if poor health status
  reduces productivity, workers will be likely to
  leave their job gt these people wont be
  rerpresented in our sample.
• Policy implication Prevention of health problems
  would be efficient to keep older workers in their
  job
• Reward at work impacts health status  on the
  long run 
• Policy implication Acting on reward at work
  would improve health status

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Conclusion (2/2)

• Reward at Work and Working Conditions
• Our results
• people are rewarded for time pressure.
• people are not sufficiently rewarded for
  physically demanding jobs.
• And High educational level, at least, are not
  compensated
• Interpretations?
• Harmful working conditions in this group are
  more difficult to recognize
• Employers behaviors why do they not internalize
  the impact of working conditions in this group
• Policy implication understanding why high
  educational levels are less often compensated for
  risky jobs gt employment rate of older workers in
  Europe.