Labor Market Vulnerability of Older Workers in the Netherlands and its Impact on Downward Mobility and Reduction of Working Hours

Abstract Based on well-established and widely-used labor market theories, we argue that workers aged 50 years and over who are more vulnerable in the Dutch labor market are more likely to experience downward occupational mobility and a reduction of working time in their late career. To test this general hypothesis, we analyze retrospective employment history data from 4 waves (1998, 2000, 2003, and 2009) of the Family Survey Dutch Population (FSDP) using event history models. Labor market vulnerability in the late career is proxied by three indicators. All 3 are strongly related to downward movements as well as cutbacks in working hours among older workers, net of educational level, employment career characteristics, household context and macroeconomic circumstances. More specifically, the results show that (a) older workers who are in lower social classes, (b) reenter employment after a spell of unemployment or disability, and (c) work part-time in their late career are more likely to experience both events. Hence, the results strongly support the general hypothesis on labor market vulnerability of older workers in the Netherlands.