Occupation-Based Life Expectancy: Actuarial Fairness in Determining Statutory Retirement Age

Abstract

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This study examines occupation-based differences in life expectancy and the extent to which health accounts for these differences. Twentyseven-year survival follow-up data were used from the Dutch population-based Longitudinal Aging Study Amsterdam (n = 2,531), initial ages 55–85 years. Occupation was based on longest-held job. Results show that the non-skilled general, technical and transport domains had an up to 3.5-year shorter life expectancy than the academic professions, accounting for the compositional characteristics age and gender. Statutory retirement age could be made to vary accordingly, by allowing a proportionally greater pension build-up in the shorter-lived domains. Health accounted for a substantial portion of the longevity difference, ranging from 20 to 66%, depending on the health indicator. Thus, health differences between occupational domains today can be used as a means to tailor retirement ages to individuals’ risks of longevity. These data provide a proof of principle for the development of an actuarially fair method to determine statutory retirement ages.

Keywords

• retirement age
• occupation
• longevity
• health
• longitudinal study