On defining persons as retired

ON DEFINING PERSONS AS RETIRED

DAVID J. EKERDT* University of Kansas Medical Center STANLEY DEVINEY University of Kansas

This article reviews the operational definition of retirement, which remains an unsettled issue in aging research. The authors describe five separate criteria that can be used to assign retirement status, and discuss the misleading distinction between subjective and objective indicators. Despite concerns about the possible ambiguity of retirement definii~o~, cross-cl~sificatio~ of persons on three criteria-pension receipt, reduced work or earnings, and .~elf-definitionshow considerable overlap depending on the popl~lat~on of interest. Much of the indeterminacy in retirement definitions can be traced to the categorical status of “‘partial” retirement, which is nevertheless important to recognize in research designs. In all, the ambiguity of retirement definitions can be managed, but not resolved, by using multiple criteria to specify better the retirement status. No one strategy for defining retirement suffices for all purposes; definitions should be suited to the research task at hand. ABSTRACT:

“Although retirement has come to occupy a place of central concern in contemporary Western society and is the subject of recurring popular and scientific discussion, there has been a certain degree of vagueness and lack of clarity as to its meaning” (Donahue, Orbach, and Poliak 1960, p. 330). This observation is as appropriate now as when it was made 30 years ago as the introduction to one of the first major reviews of the retirement literature, Donahue and her colleagues went on to

*Direct all correspondence to: David J. Ekerdr, Center on Aging, Universityof Kansas Medical Center, 39th and Rainbow Blvd., Kansas Ciry, KS 66103. JOURNAL OF AGING STUDIES, Volume 4, Number 3, pages 211-229 Copyright 0 1990 by JAI Press, Inc. Ail rights of reproduction in any form reserved. ISSN: 0890-4065.

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describe cases that would defy simple definitions of retirement, especially cases of women’s experience. It is still the style, when surveying the field, for authors to note that retirement is too ambiguous a concept to yield to easy definition, and then to illustrate with one or more complex cases (e.g., Clark 1980; Fields and Mitchell 1984; Schulz 1988). If the task is to categorize a full sample of persons as retired for research purposes, there is a priori no best way to do it. The competing criteria for assigning persons to the “retired” category have enough overlap that most individuals can unarguably be defined as retired. Yet there are many cases where assignment to retirement would be disputable under alternate criteria. Herbert Parnes has cited his own recent career as a case in point: “[Rletirement from one university after 33 years of service; acceptance of a full-time professorship at another after a threemonth vacation; resignation from that position two-and-a-half years later; and subsequent short-term teaching or research assignments each year at the first university. When did retirement occur? Or has it yet?” (Parnes 1989, p. 23). No author is particuIariy dogmatic about the de~nition of retirement, nor is there reason to be. Social science generally controls few of the definitions of its central concepts. Yet the retirement field remains uneasy about the definitional inclarity of the concept around which it is organized. This is an article about the retirement status and when it begins, and about the practical matter of drawing a line-if one can be drawn-between retired and not retired. We review the criteria for being retired; discuss overlap among criteria; weigh the lay meaning of retirement against research operationalizations; consider the advantages of dichotomous vs. polytomous definitions, and definition by single vs. multiple criteria; evaluate the definitional placement of “partial retirees”; and discuss how definitions should be suited to the research problem. This article is concerned with operational definitions of retirement, with making the concept a variable for research purposes, and devising indicators of the variable. With no measurement task at hand, retirement is a concept that stands in less need of definitional clarity. What people-lay and scientific-“mean” by retirement behavior is shared well enough that reasonable discussion can go forward on such topics as “retirement preparation” or “income security for retirement.” In addition, definitions of retirement are only an issue if research purports to be about retirement. Some studies confine themselves specifically to analyses of labor supply, later careers, and pension receipt without invoking the concept of retirement. Government and economic statistics tend to avoid definitions of retirement-and the difficult conceptual issues involved-by narrowing the focus to labor force participation or earnings (Schulz 1988). Yet it is hard to maneuver around the concept of retirement when studying the work or earnings patterns of later life. Any research report that characterizes itself as being about retirement must necessarily define retirement, no matter how obliquely it confronts the conceptual issues involved.

SINGLE CRITERIA In the American experience, a person may be considered to be retired if he or she has separated from a career, cut back on work effort, quit working altogether, or

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On Defining Persons as Refired

started receiving Social Security or employer’s pensions. Persons can also be considered as retired if they say they are retired. Five major single criteria for defining retirement are introduced below.’ Each has reasons to recommend it and each immediately suggests exceptions.

Separation From a Career Under this criterion, persons retire upon leaving a job, position, occupation, or employer with which they have a long association. It is a criterion for which retirement is largely a one-time event. (Youthful “retirements” from short-lived careers in entertainment or sports are not of interest here.) The idea is clear enough-people retire when they leave their life’s main work. However, the idea is not easy to operationalize mainly because it defines one indeterminate concept (retirement) with another (career). First, there is not enough common experience; not all workers have continuous careers in one place or line of work. Second, those who do have careers may separate at different times from the job, position, occupation, or employer. If a vocational education teacher concludes a career at the local high school but remains occupationally an active plumber, is this a careerending retirement? When there is not enough common experience and homogeneity of experience vis-a-vis careers and endings, it is difficult to frame survey questions about these transitions. One post hoc strategy (i.e., devising a measure from data already collected) is to characterize the position with longest tenure as the “career job” and one’s having left it as retirement.

Exit from the Labor Force Exit-retirements occur when an older worker has no current employment, as indicated by zero hours worked or zero earnings, and is not seeking employment. This status, of course, could change over time and new employment of any extent would be interpreted as a transition out of retirement. Exits, as calculated into the “labor force participation rate,” are a commonly reported population statistic that is often interpreted as indicating how “retired” an older population is. Operationally, labor-force exit is the easiest, most convenient definition of retirement, so long as the investigator does not overlook occasional or seasonal employment that occurs on a regular basis. Because exits are so definitionally clean, we wonder why call them retirements at all, rather than simply labor force participation. The exit criterion also has the effect of grouping together as “nonretired” all persons with any work activity-full-time employment along with nominal engagements in the labor force. This dichotomy masks the nature of older persons’ work patterns, which are increasingly characterized by part-time employment with advancing age (Schulz 1988).

Reduced Effort By this criterion, retirement is a substantial reduction in labor supply or income, as indicated by a lower level of work activity or earnings. This can be calculated annually or based on current experience. In practice, reduced effort is rarely

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measured directly, and rarely treated as a continuous variable. Rather than measure reduction longitudinally from some prior baseline, certain levels of work activity or income, measured cross-sectionally, are taken to indicate reduced effort among persons assumed to have formerly had regular, full-time employment. The “reduced effort” criterion is a refinement of the previous “exit” criterion, locating the cutoff for retirement/nonretirement higher up the labor supply distribution. The exit and reduced-effort criteria are sometimes combined into a trichotomy indicating complete, partial and nonretirement. The reduced-effort criterion (as limited earnings) is, in fact, Social Security’s definition of eligibility for the retirement benefit (along with age). The identification of Social Security eligibility with limited earnings gives the reduced-effort criterion a good deal of face validity as a measure of retirement. There are a few possible pitfalls in the measurement of work and income levels as retirement indicators. Beck (1985) and Honig and Hanoch (1985) point out that accurate measures of work activity are tricky among recent retirees, whose pre- and post-transition work effort can become confounded in measures of total annual hours or weeks of work. For example, one might misclassify as partial retirees individuals who retired completely in midyear. In choosing indicators, Gustman and Steinmeier (1984b) also caution that a reduction may be indicated in some individuals by a cut in annual weeks worked but not weekly hours worked, and vice versa. Assuming individuals are arrayed satisfactorily along some reduced effort continuum, the next step is to draw the line between retirement, partial retirement, and/ or nonretirement. (The continuum itself makes an awkward measure, a point we discuss later.) What is a reasonable and meaningful cutoff: 1000 total hours of work per year (20 hours per week), or 1750 total hours (35 per week)? The problem is illustrated in Table 1. Represented here is the work activity of respondents to the 1984 Supplement on Aging of the National Health Interview Survey (Fitti and Kovar 1987).’ The table shows a cross-classification of annual weeks and weekly hours of work among respondents aged 55 to 69 who had any work experience after age 45. In what region of this table are people to be called retired? Where might partial retirement begin or end? Work effort is often called an “objective” measure of retirement, yet determinations of full, partial, or nonretirement are fairly arbitrary. Some clues about where to categorize along the work effort or earnings continuum can be had by reference to other criteria. For example, Murray (1979) has shown that people do not call themselves “partially retired” in great numbers until they have reduced work to 3@34 or even 25-29 hours a week. The irony of this example is that self-reported retirement status could be used as a guideline for categorizing an “objective” measure.

Pension Receipt Under this criterion, person mainly being the retired-worker or public employment. Pension

retire upon receipt of retirement pensions, these benefit of Social Security or a pension from private eligibility is an administrative definition of retire-

Hours Worked

l-4 5-9 lc-14 15-19 2&24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60+

0

TABLE 1

3480

0

5 9 9 6 16 1 6 3 44 4 3 3

1

5-9

I 10 4 5 8 2 1 5 26 1 1

7-4

3

2

4 7 7 4 10 3 I 8 46

lo-14

4

2 7 1 1 6 4 8 4 25 2 2

15-19

4 5 5 11 2 4 9 34 I 2 2 6

20-24

5 10 7 5 13 5 IO 6 56 2 3 2 4

25-29

Weeks Worked

3 7 4 8 8 3 4 3 30 4 3 2 5

30-34

1 3 7 10 5 6 18 13 38 5 5 2 2

35-39

8 8 2 15 14 16 10 52 6 6 4 3

4b-44

9 6 4 13 7 7 16 39 10 4 5 5

45-49

11 42 45 69 155 51 119 189 1156 196 177 55 204

50-52

Cross-classification of Hours and Weeks Worked in the Past 12 Months Among 6,957 Persons Aged 55-69 Surveyed by the 1984 Supplement on Aging: Cell Counts.

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ment and already an amalgam of other criteria. Eligibility for the Social Security benefit is defined by age, previous employment, and reduced earnings (the socalled retirement test). For other pensions, receipt is contingent on age or length of service, and typically there must be separation from the employer for there to be a benefit award. Pension receipt, however, allows few blanket assumptions about previous or current work activity and thus about the nature of pension-defined retirement as a withdruwul from work. While earnings must be limited to receive the Social Security benefit, it cannot be assumed that earnings were previously higher or that new beneficiaries had been working regularly. Simple attainment of the eligibility age allows one to turn a career of partial employment, intermittent employment, or disability into a “retirement.” Private pension receipt does entail separation from a full-time job, but it does not preclude full-time employment at another job. The measure of pension receipt, if it is to be an indicator of retirement, should be built from questions about both pension sources, Social Security and employer pensions. Social Security is nearly universal in its coverage, but only one-third of retirees actually receive other pensions (Kotlikoff and Smith 1983). Receipt of one does not presume receipt of the other. Investigators should be sure that questions about retirement pensions are just that. Disability benefits and worker’s compensation are sometimes colloquially called “pensions,” allowing disabled people to regard themselves as retired. It hardly clarifies the definition of retirement to stir in the ambiguous concept of disability.

Self-Definition Persons can be considered to be retired if they say they are. This is typically called a “subjective” definition of retirement, which is an unfortunate label. In social science generally, the quality of subjective data is usually compared unfavorably to so-called objective data with their greater validity, reliability, and intelligibility. When self-reports of retirement status are labeled as subjective-in contrast to the so-called objective indicators of reduced effort or pension receiptit may be meant that retirement status is subjectively reported. However, unless data were generated by the rare strategy of matching individual records with pension plan or Social Security files, almost all information in retirement research is subjectively reported and might properly be termed subjective labor force participation, subjective earnings, subjective benefits, etc. In another sense, the subjectivity of research participants (in their determinations of retirement status) are contrasted with the objectivity of scientific classifications. Yet subjectivity, too, who also contrive characterizations of inheres in the activity of investigators, retirement using unreported or unexamined judgments, assumptions, and reference to common consensus. The proper contrast is not the subjectivity or objectivity of assignments to the retirement status, but the source of the assignmentself-definition vs. investigator definition. Nevertheless, it is still important to understand what people mean by their When people say they are retired, are they confirming a role exit responses. (Ebaugh 19&S)? Or assuming a social identity? Are they acknowledging facts about

On Defining

Persons as Retired

217

their employment or income? The issue has not gone unexamined in the literature. Numerous studies have described self-reports of retirement status in terms of other retirement criteria and personal characteristics (e.g., Gustman and Steinmeier 1984a, 1984b; Honig and Hanoch 1984; Murray 1979; Parnes and Less 1985a; Quinn 1981). Yet there is still concern that some self-reports will express fairly idiosyncratic ideas about what constitutes a retirement. According to Belgrave (1988), for example, it can happen that older women, who have been housewives for virtually all of adulthood but receive spouses’ pension benefits, define themselves as retired. Other women with full and concluded work careers may see themselves as housewives. Gibson (1987) notes another problem, that self-definitions can confuse retirement with disability. Depending on the relative availability of disability pay vs. retirement benefits, persons in similar situations could prefer one status over the other in constructing their identity. Claims about being retired may also be difficult to interpret among persons with histories of irregular work patterns or chronic unemployment (Bould 1980; Jackson and Gibson 1985). Finally, we note that self-definitions may change over time in ways that make it difficult to pinpoint the date or event of retirement. Persons may not decide they are retired until sometime after they have entered a set of circumstances. For example, after a spell of disability or unemployment, a person may later decide that that he/she had retired when that spell began.

OVERLAP AMONG CRITERIA Single criteria easily call to mind cases of retirees who would be misclassified on other criteria. For example, persons with pensions or reduced work activity may refuse to self-identify as retired. Empirically, however, what is the overlap, or lack thereof, among criteria? In how many cases would the separate criteria assign the same individuals to retirement? What would be the prevalence of arguable assignments? The literature carries reports about overlap among three criteria: reduced effort, pension receipt, and self-definition. Of the two other criteria discussed above, career separation is rarely measured, and labor-force exits can be considered to be a category of reduced effort.

Classification on Three Criteria Parnes and Less (1985a) presented a joint-criterion classification among older men in the National Longitudinal Survey (NLS). Table 2 here shows an arrangement of Parnes and Less’s table reporting information about 2,794 men aged 60-74 in 1981. Using binary indicators, self-reports regarding retirement were crossclassified with annual hours worked and pension receipt. Men were called retired if they ever met the criterion between 1966 and 1981. In the NLS data in Table 2, the authors saw 81.3% of the men (cells 1 and 8) as consistently classified across all three criteria. Only 9.7% of the sample was classified as retired by a single criterion only (cells 2, 3, and 5). Parnes and Less conducted other analyses of their three indicators. In the aggregate, the more criteria that were in effect, the higher the cumulative propor-

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TABLE

Vol. ~/NO. 311990

2

Cross-Classifjcati~n of Three Retirement Criteria” from Fames and Less ft985a, Table 3-2): Percentage distributions of 2,794 National Longitudinal Survey Men Aged 60-74 in 1981. Underlined Cells are Men Retired/Not Retired by All Criteria. Numbers in Parentheses are Cell Labels.

tion of the sampie that was defined as retired. Yet if men were retired by any single criteria, about three-quarters were retired by all three. Also in the aggregate, the single criteria separately did not differ by more than 6% in assigning proportions to retirement throughout the 1970s; the pension criterion tended to count the most men as retired, and self-reports were the most conservative indicator. Self-reports were almost never the sole indicator of retirement (see ceil 5 in Table 2). More men as a group were also called retired if they had ever, rather than currently, fulfilled criteria. All this is not to say that criteria are it~terchangeab~e. Parnes and Less further compared the characteristics of ind~viduaIs who met one, two, or three criteria (the occupants of the separate ceils in Table 2 here). Age togicalfy increases the odds of meeting all three criteria, and the ail-criteria retirees in the NLS (cell 8) were older and therefore more likely to have health problems, less work activity, and lower incomes. ‘The group of men retired by the work indicator alone or in combination with one other indicator (cells 3,4, and 6) had a larger proportion of disabled men whose pensions may have been disability benefits. Men with pensions only (cell 2) or pensions and self-reports (celt 7) were the most advantaged of the retirees in terms of income, health, and life satisfaction. These would include the retirees with full-time second careers. The small and relatively young group of men retired only be self-report (cell 5, 1.5%) may have experienced unpensioned job or career changes that they interpret as “having stopped work at your regular job,” which was Parnes and Less’ indicator of self-reported retirement. In all, the prevalence of different arguable cases is not high. Most are not anomalous and represent understandably situations {e.g._ pensioned and selfdefined retirees who still work full time [cell 71). Least easy to explain are the very few persons in cell 4 (2.1%) who decline to s&f-identify as retired even though they are receiving a pension and have SL~bstantiaily withdrawn from the fabor force. Other three-way classi~c~~tions of retirelnent criteria have been reported in the literature (Irelan and Bell 1972; Reno 1976). Murray (1979) canducted an analysis of men and nonmarried women in the Retirement History Study (RHS), where nearly 8,000 persons aged 64-69 in 1975 were classified in a 3 ~3x2 array. Self-

On Defining

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219

definition was based on claims about being not, partly, or completely retired. Work activity had three levels: not working, part-time work (l-34 hours per week) and full-time work (35+ hours per week). Pension receipt was a binary indicator. Murray’s report does not allow us to specify all of the cells in the crossclassification. In all, however, Murray labeled 70.9% of the sample as having “perceptions consistent with behavior”, i.e., consistently classified as retired/not retired across all three criteria. A similar figure was also reported for the sample’s status in the earlier years 1969, 1971, and 1973. This total proportion was somewhat lower than in the NLS data in Table 2 (81.3%), in part because of different indicators, because the RHS sample included some women, and because the NLS sample was filling fewer cells. In an additional joint analysis of the three criteria, Murray used a regression model that correctly predicted self-reports as a function of work activity and pension receipt, as well as age, but not such factors as race, education, health, and retirement attitude. The analysis illustrated two themes related to defining retirement. First, shared variance among criteria was somewhat greater for men than for nonmarried women, introducing the idea that overlap among criteria is better for men. Second, while the self-reported categories “not retired” and “completely retired” were well predicted by the other criteria (more so for men than women), the “partly retired” response was not so successfully classified. The indeterminacy of partial retirement is an issue we return to later. The NLS and RHS populations primarily reflect the experience of men. In order to compare women with men in a national sample, we conducted a new crossclassification of the three retirement criteria. As in Table 1, we again used data from the 1984 Supplement on Aging of the National Health Interview Survey, which are based on interviews with a multistage probability sample of the noninstitutionalized population aged 55 and over (Fitti and Kovar 1987). Table 3 shows cross-classification separately for men and women where the criteria are operationalized similarly to Murray (1979) in a 3 x 3 x 2 array. The table includes 6,951 persons aged 55-59 who reported having had work experience since age 45. The table excludes 235 persons with missing data on any of the indicators. In Table 3 we have underlined the diagonal pattern of cells where people can be said to be defined consistently by all criteria. Summing over these, a total of 77% of men and smaller 58.5% of women were unambiguously classified on the joint criteria. The figure for men is close to that seen in Table 2 among NLS men. Some of the inconsistent classifications in Table 3 stem from the fact that respondents were asked about work activity over the past year, but defined their retirement status “at this time.” If we only classify persons retired one year or more (not shown), then a total of 80.8% of men and 60.7% of women were consistent on all three criteria. Most persons in Table 3 are retired by at least two criteria. Only 5.9% of men and 6.7% of women are classified as retired by one indicator alone (cells 2, 5, 13). An analysis of the cell and marginal counts for Table 3 shows, for example, that among persons who claim to be partly or completely retired, 96.6% of men and 93.5% of women are retired by at least one other criterion (not working or receiving a pension).’

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TABLE

311990

3

Cross-Classification of Three Retirement Criteria” from the 1984 Supplement on Aging: Percentage Distributjons of Men and women Aged 55-69. Underlined Ceils are Persons Defined Consistently by all Criteria. Numbers in Parentheses are Cell Labels. MEN (N = 3,682) Self- Report Part/y Retired

Not Refired Working:

No Pension

Pension

No Pension

(1) 34.1 (3) 1.0 (5) 0.6

(2) s.0 (4) 0.5 (6) 0.1

(9) 0.7 (11) 0.4

Full time Part time Not working

WOMEN

(7) 1.0

Working:

&If-report:

Security,

Pension

(8) 3.5 (10) s (12) 1.7

(13) 0.3 (15) 0.1 (17) 3.6

(14) 3.5 (16) 1.7 (18) 38.7

Self-Repot Partly Retired

No Pension

Pension

(I) 24.2 (3) 6.2 (5) 3.7

(2) 2.1 (4) 2.0 (6) 0.9

Full time Part time Not working

time

Retired

No Pension

(N = 3,269) Not Refired

full

~~pie~eiy

Pension

“At =

this time.

30 hours

government,

do you consider

or more

per week

or private

pension

No Pension

yourself

partly

in the past year. from

Pension

(7) 0.7 (9) u (11)

own

1.h

rctircd. part

(13) (IS)

(12)

(17)

=

1.4 rctircd,

I--2’) hours.

Retired

No Pension

(8) 0.9 (10) u

complctcly time

Co~pietely

0.9 0.7 17.3

or not r&cd Pension:

Pension (14) (16) (18)

at all?”

1.9 1.2 30.0

Working:

Yes if receiving

Social

work.

As we observed among NLS men in Table 2, the prevalence of the different kinds of arguable assignments is not high, at least among men. The greatest source of indeterminacy among men is the group of pension recipients who work full-time (cells 2,8, 14), and who split their definitions of themselves as being not, partly, or completely retired. Among women, the number of arguable classifications in certain cells is higher, largely because some women receive no pension from their own work experience, even though they have reduced work activity (cells 3, 5) or claim to be retired completely (cells 15, 17). This suggests that the pension criterion is less useful for defining women as retired. Overall, the information in Table 3 specifies sources of ambiguity in retirement definitions, and it confirms that whatever ambiguity there may be, it will tend to be greater among women (Fox 1977). Further analyses of the three measures from Table 3 showed that the total number of persons defined consistently by all criteria was somewhat greater among white vs. nonwhite men (77.2% vs. 72.9%) and white vs. nonwhite women (59.1% vs. 53%). Also, consistency among criteria was somewhat less for all persons in the age group 60-64 (vs. 55-59 and 65-69). At these ages job and retirement transitions are most frequent and status on the three criteria is least likely to be coordinated in time. All of these breakdowns illustrate that the operationalization of retirement definitions is more or less of a challenge depending on the population of interest.

On Defining

Persons as Retired

221

Classification on Two Criteria Several reports in the literature have compared self-definitions to other retirement criteria. Among household heads in the Panel Study of Income Dynamics, the self-reported year of retirement was confirmed by an abrupt reduction in annual work hours for the following year (Morgan 1980, Table 3). One survey item that has been frequently analyzed is the self-reported trichotomy, not/partially/completed retired, from the Retirement History Study (RHS). Quinn (1981, Table 7), for example, described how types of pension eligibility increased the probability of self-employed persons calling themselves partly or completely retired. Among the RHS respondents, Quinn (1981, Tables 1 and 2) also compared the three self-reported categories on their levels of labor force participation in 1969. Murray (1979, Table 5) had examined the same question among the RHS population from 1973. Both authors reported that there was very little work activity among persons claiming to be “completely” retired, and there was substantial work activity among the “not retired.” “ Partly retired” meant just that, for there were broader distributions of labor force participation among this group, who made up 16% of the RHS panel in 1973. Identifying with partial retirement did not really begin until work activity had dropped to about 30-34 hours a week (Murray 1979). Median annual hours of work among the partly retired were 1,100 hours for wage and salary workers and 1,500 hours for the self-employed (Quinn 1981). In both studies, however, there was no clear point along the work activity continuum where a self-reported category of partial retirement could unarguably be said to begin. The designation of partial retirement on reduced effort alone is thus a matter of interpretation. Another analysis of RHS respondents by Honig and Hanoch (1985, Table 2) cross-classified the self-report trichotomy with a retirement status trichotomy based on relative earnings. The ratio of current earnings to earnings of the last 20 years was used to defined RHS men as fully retired (no earnings), partially retired (earnings currently l-50% of previous maximum), and nonretirement (earnings more than 50% of previous maximum). Again the self-reported categories of full retirement and nonretirement were consistent with the same categories defined by the earnings-ratio criterion, with over 80% correct classification. Joint classification of partially retired men was much lower. Yet the correspondence between the two definitions was illustrated by an analysis that modeled partial retirement as a function of hourly wage, weekly hours of work, and annual weeks of work. Regression results using the earnings-ratio definition of partial retirement were virtually similar to those using self-reported status. Honig and Hanoch’s findings, along with those of Murray (1979) and Quinn (1981) indicate that such categories as “completely” retired and “not” retired quite consistently classify the same individuals regardless of criteria. The intermediate category of partial retirement, when defined by self-report, is an indeterminate status in terms of the reduced effort and pension criteria, and vice versa. Thus, if investigators want to use a category called partial retirement (however it is operationalized), this strategy will not reduce ambiguity. Rather, it will tend to concentrate the more ambiguous cases within the category of partial retirement.

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One test of the covariance among retirement criteria is to examine what difference it makes when alternate retirement status variables are used in an actual analysis. Gustman and Steinmeier (1984b) conducted an analysis whose outcome categories were self-reported retirement (not, partially, completely) among RHS men. In predicting the characteristics of these groups, the authors reported (Fn. 7) that they also used an alternate measure of retirement status based on reductions in hours and wages. They found that the correspondence between findings based on alternative definitions was relatively close, and that the alternative measure would not have affected their main conclusions (see also Diamond and Hausman 1984, p. 99 and Fn. 1). Palmore and his colleagues (1985) reported a more ambitious trial of alternative retirement definitions. In a series of analyses that examined antecedents and consequences of retirement across seven sets of panel data, these authors proposed to measure retirement, where feasible, in three different ways: as self-reported status (“subjective retirement”); as reduced effort (“objective retirement” defined mainly as working less than 3.5 weekly hours); and using hours-worked as a continuous measure of retirement. The comparison of retirement definitions was of secondary importance as Palmore and colleagues reported their findings. Results did sometimes differ by the choice of retirement measure. This would not be surprising given that comparisons involved different levels of measurement, different operationalizations of the same criteria across data sets, as well as different sample characteristics across data sets, More often, results from different measures were not dissimilar enough to warrant a separate presentation of findings: “No large or consistent differences were found in the effects of different measures of retirement . . .” (p. 49), and “the retirement measures used had virtualfy no effect on the findings” (p, 114). Indeed, the consistency of findings across retirement definitions was taken by Palmore et al. to indicate the robustness of their results.

MULTIPLE CATEGORIES AND PARTIAL RETIREMENT Although retirement criteria are not interchangeable, there is substantial overlap among them, and suggestions are that different definitions may yield largely the same research conclusions. Aside from the choice of criteria, there are other issues to be considered in defining retirement for research purposes. One of these is the level of measurement for a retirement status variable. Should a continuous or categorical measure be used? If the latter, how many categories should there be? Can multiple categories be ordered to reflect literally the idea of partial retirement? A continuous measure of retirement will necessarily involve the reduced-effort criterion. Any continuum of reduced effort, however, will have the unfavorable statistical properties of a nonnormal, himodal distribution. In any population of persons of retireable age, large numbers will be found at the extreme ends of the continuum-zero work activity or earnings at one end, and unreduced full-time effort at the other (e.g., Honig and Hanoch 1985, Table 1; Quinn 1981, Table 2). Such a distribution confounds usual statistical procedures, and it begs to be categorized. The unsuitability of a continuous measure is no serious loss to retirement

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research because both lay and scientific notions of retirement regard it largely as a categorical status anyway. If retirement is to be a categorical variable, how many groups should there be? The data from Parnes and Less (1985a) in Table 2 above illustrate that a partition of a population based on three binary criteria yields an 8category classification. The 3 x 3 x 2 array in Table 3 yields 18 retirement categories. While such polytomies honor the criteria well and illustrate the heterogeneity of retirement experience, they leave some fairly small categories in a variable that is frankIy too unwieldy for anything more than simple descriptive statistics. In further collapsing some large polytomy, at least two categories seem empirically and conceptually justified, namely, that pair of modal situations where individuals are unarguably retired and not retired by all criteria. These, for example, would be cells 1 and 8 of Table 2. The task is to assign the remaining situations. From Gustman and Steinmeier’s (1984b) perspective of several years ago, most studies of retirement behavior favored a dichotomous dependent variable. More recently, however, there is an awareness that dichotomies can conceal other important patterns of disengagement from work, the foremost being a status of partial retirement (Parnes 1989). This brings us to one of the central problems in defining retirement: where to put the partial retirees? The prevalence, duration, and correlates of partial retirement have been described in studies that also refer to this status as post-retirement employment, and the persons involved as “retired workers” or the “working-retired.“’ In numbers, perhaps one-third of persons work part-time after pension receipt or self-identification as retired (Beck 1985; Gustman and Steinmeier 1984a, 1984b; lams 1987; Morgan 1980; Parnes and Less 1985b). Estimates are somewhat lower if measuring the proportion who are currently employed, v. ever employed, part-time. While substantial numbers go through a spell of part-time employment, it has also been shown that spells of partial retirement are fairly short, 2 to 3 years on average (Gustman and Steinmeier 1984a; Honig and Hanoch 1985). These and other studies (Anderson, Burkhauser, and Butler 1987; Beck 1986; Holden 1988; Honig 1985; Iams 1986, 1987; Quinn 1981) have described the characteristics of partial retirees, who are often defined as such by self-report measures. Post-retirement employment is slightly more likely among men, and among retirees who are younger and healthier. Such employment is likely to entail a change in occupations and downward shift to a less prestigious occupation with a lower wage rate. The major self-reported reasons for post-retirement employment have been shown to be inflation (28%) and boredom with retirement (21%) (Parnes and Less 198Sb). In all, the category of partial retirees is large enough and distinctive enough that their placement within a categorical retirement status variable will not have a trivial impact on findings. Gustman and Steinmeier (1984b) point out that among all those aged 65 and over who are working, the number of partial retirees is comparable to the number of full-time workers. They argue that any model of retirement behavior that excludes the possibility of partial retirement is misspecified. But how shall we include partial retirement, that is, recognize it in research

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designs? Leaving aside the criteria for partial retirement, there seem to be two strategies: partial retirement as a conditional state and as a separate category. In one, let the major distinction be between nonretirement and retirement, and treat partial retirement as a conditional subcategory of the latter. The other strategy is to treat partial retirement as a third alternative to nonretirement and complete retirement. As such, partial retirement could further be regarded either as an unordered alternative or as an intermediate category between unreduced effort and complete withdrawal. The choice of strategy here entails conceptual and statistical implications that are best evaluated within the context of specific research problems. Does the investigator want to model partial retirement as a conditional state (subcategory) of retirement, or as a qualitatively different and perhaps transitional kind of retirement? Honig and Hanoch (1985; Honig 1985) have argued, based on theoretical and empirical considerations, that the conditional-state strategy is more consistent with actual labor supply decisions: “the critical choice for a large number of older workers is that of labor force participation first, with hours of work (either partial retirement or nonretirement) determined conditionally” (p. 46). Thus, research designs can recognize post-retirement employment as an explicit form of retirement behavior without necessarily designing a trichotomous retirement variable. The specific idea that partial retirement can be regarded as a transitional statean ordered category-lying on a continuum between nonretirement and full retirement does deserve some comment. Partial retirement is sometimes identified with “gradual retirement,” or characterized as an “intermediate stage” in the retirement “process” (e.g., Murray 1979). The assumption here is that real retirement is zeroemployment retirement. Authors who frame things in this way, however, are imposing an idea that lay opinion may not corroborate. There is no doubt that the strongest flows (transition probabilities) involving partial retirement are from nonretired to partly retired to fully retired statuses (Gustman and Steinmeier 1984a, 1986; Parnes and Less lY85b). However, continuity at the analytical level between full-time and part-time employment is not the same thing as continuity of employment experience. Partial retirement tends to entail moves to different and more marginal jobs. Private pension receipt almost always precludes continued service with the same employer. Even without a pension, bureaucratic rules and institutional constraints in a large majority of jobs do not permit individuals to cut down their commitment at the same position (Beck 1986; Gustman and Steinmeier 1984b). Older workers who want to cut back must quit their main job and find one that does permit part-time work-a sequence of exit and re-entry. However, as Gustman and Steinmeier (1984a) observe, any worker who can reduce hours without changing jobs is more likely to be a partial retiree. Analyses of the NLS data (Beck 1986; Parnes and Less 1985b) have found that almost two-thirds of retired men who still work will have changed occupations, with the majority of these shifts consisting of downward mobility. Even if men remain in the same occupation, they will have gone to jobs with lower wage scales and poorer working conditions. Partial retirement is gradual retirement in the sense that it represents an arithmetic reduction in work effort or earnings. Whether people in this situation regard

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themselves as gradually retiring is not known. Are they purposely cutting back, slowing down, or easing out? Or are they picking up a little work, getting some extra income, or earning their quarters (for Social Security eligibility)? When it is not directly researchable survey respondents self-identify as “partly retired,” form large data sets whether they think of themselves as being in a conditional state or a transitional phase of disengagement. Research does show that there is enough discontinuity of experience between full- and part-time jobs that scientific characterizations of a “gradual” retirement are at best an ascription.

MULTIPLE

CRITERIA

Many objections to the ambiguity of any single criterion as a definition of retirement can be overcome by combining it with one or two other criteria in order to specify better the retired status. Individuals are retired, for example, if they did this and are that. Atchley (1979) reported a consensus recommendation that retirement surveys should include measures of three criteria-reduced effort, pension receipt, and self-definition-so that a variety of operational retirement definitions could be constructed. Most large data sets on work and retirement in fact have such versatile data on hand. It is important to understand, however, what happens to ambiguous cases when using multiple criteria for defining retirement. In tidying up one category of a dichotomous or trichotomous retirement status variable, the ambiguous casespersons who fulfill only one criteria but not two or three-are swept into the remaining group(s). For example, by calling on multiple criteria to specify more exactly who is retired or partly retired, the definition tends to relegate any arguable cases to the residual category of nonretirement. The opposite would true if trying to arrive at a clean, precise classification of “nonretirement”-the remaining cases are all residually grouped as retired. Ambiguity, once again, is not resolved, only isolated within a category of the retirement measure. Multiple-criteria definitions thus manage, but do not eliminate, the dilemmas of retirement classifications. This poses no problem when the research task to select a particular group for further study, say, pensioners with no work activity. But when the task is to partition and analyze the full sample, it is important to appreciate that ever more specific definitions of one group will populate the other group(s) with arguable cases. Fortunately, the number of arguable or residual cases in a two- or threecriteria definition is probably not so large as to endanger a robust finding. One obvious strategy for handling ambiguity is to forego altogether full sample partitions and analyses. If 2%, 5% or 10% of a sample cannot be satisfactorily classified as to retirement status, exclude them from the design. Or include them in trial analyses but exclude them from the final presentation of findings, reporting what difference it makes.5 Relaxing a full sample design is not an extreme step. After all, entire panel studies of work and retirement exclude population elements precisely because their work and retirement characteristics cannot be confidently addressed. For example, the 1969 RHS baseline panel excluded persons in institutions and (!) married women (Irelan 1972).

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SUITABLE DEFINITIONS Work and earnings experience in later life can be investigated without reference to the idea of retirement. If retirement, however, is to be an explicit element of a research design, it needs to be defined in a manner that is suitable to the problem at hand, which may be: to characterize a population in the aggregate (say, the proportion who are retired); to single out for study retirees or nonretirees, or to compare them; or to study retirement as a discrete act or event-its timing, its motives-at one point in time, or follow a cohort’s retirement experience through time. No one strategy for defining retirement may suffice for all these purposes. Parnes and Less (1985a) concluded that their findings did not suggest an optimal de~nition for retirement. Definition strategies also may find more or less favor among disciplines that conduct empirical studies of retirement, such as economics, history, management, political economy, psychology, and sociology. We cannot state strict guidelines for the suitability of retirement definitions. Certainly definitions of convenience are not desirable-retirement being what the data can measure it as. There should be concern for continuity with previous definitions in a strain of research, and with the statistical properties of the retirement variable. Perhaps the major consideration is whether the research task falls within one of two general foci for the field: retirement as a change in labor market behavior, or retirement as a change in social position. The distinction is heuristic, but it conveys that retirement behavior can be of interest because it signals new economic roles, relationships, and patterns of consumption, or because it is a transition that entails revisions of identity, status, and social ties. An investigator would not want to embark on research about retirement as economic behavior without the reduced-effort or pension-receipt criteria built into the retirement definition. Retirement as a social behavior would seem to call for self-reports as part of a retirement definition. Especially when studying pre-retirement attitudes or anticipatory behavior, definitions must recognize individual’s own construal of the retirement idea, for that is the only reality that retirement yet has. Finally, the coincidence (but not coextensiveness) of retirement as economic and social behavior seems to support the use of mixed or multiple criteria for defining retirement (Atchley 1979). Disengagement is, after all, a mixed experience when one-third of persons work after they claim to have retired. When analyzing secondary data, there is only a conceptual penalty for using an ill-considered definition of retirement or partition of the population into workers and retirees. The worst that happens is inappropriate inferences about the empirical world (e.g., “People retire because . , ” “Workers and retirees differ in the following way. _ . “) Data can always be reanalyzed with alternative definitions, or another data set can be located. In primary data collection, investigators must get it right the first time. In particular, survey questions specifically about retirement must honor lay conceptions of retirement. Imposing an unfamiliar or unusual idea of retirement can jeopardize research goals or foreclose opportunities for data analysis. To illustrate, the National Council on the Aging surveys of older Americans (1981) included an attit~~dinal question about retirement that identified retirement with zero employment: “In general, how do you feel about the idea of retiring

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completely-do you look forward to it or not?” Of persons aged 18-64, 45% did and 49% did not look forward to retiring-completely. This finding was summarized as “today’s working Americans on the whole do not look forward to the idea of retiring” (p. 56), a statement that, while true to the data, is quite at odds with the welcome that American workers accord the opportunity to retire (Clark 1988). Another consideration is the temporal dimension of a definition. Research goals may be limited to knowing whether persons are currently retired or have ever retired. If individuals are to be followed over time, definitions have to allow for changes or reversals in status. Some single criteria are less appropriate for dynamic models. The career-separation criterion constrains retirement to be an irreversible event. The same is largely true for the pension-receipt criterion (though individuals can forego Social Security income once they begin receiving benefits). Repeated self-reports may not by themselves reveal spells of reemployment. Repeated measures of work activity or earnings can reveal changes in retirement status. However, if these variables are grouped too broadly (i.e., using simple labor force participation as the indicator of retirement), they will not be sensitive enough to describe real changes in the retirement experience.

CONCLUSION Defining persons as retired for research purposes is at once harder and easier than it appears. It is harder because strategies for reducing the ambiguity of retirement classifications largely succeed only in moving ambiguity around. For example, introducing a category of partial retirement as an alternative to nonretirement or full retirement will not resolve the number of arguable assignments, but rather concentrate them among the partial retirees. So-called objective criteria for retirement, such as reduced work or earnings, entail arbitrary cutoffs or exclusions that are themselves debateable: How much work is part-time work? Are disability definitions of retirement can benefits a retirement pension ? Multiple-criterion better specify certain retirement categories, but at the expense of precision for the residual categories into which the anomalous cases are assigned. Yet operational definitions are also not so difficult as they first appear. While anomalous situations are easy to conceive when considering single-criterion retirement definitions, cross-classifications of major criteria show considerable overlap among them, and more so among men than women. Also, by using a two- or threecriterion retirement definition, the number of arguable classi~~ations can be seen to be fairly small relative to the number of persons for whom retirement status is a straightforward matter. Some studies have even shown that alternative definitions yield findings that are not dissimilar enough to warrant separate presentation. Finally, truly puzzling cases can be excluded from attempts to partition a full sample into the nonretired and retired.

NOTES 1. Any career,

definition of retirement implies a withdrawal from work, job, occupation, and so presumes that persons eligible to be “retired” must first have occupied

or the

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worker role or had some sustained relationship to the labor force. If a person has never been much employed, we should not say he or she is retired. Thus, there is a small number of men, but a larger number of women, for whom retirement cannot be defined, and this discussion does not concern them. Neither will we discuss transitions in or out of unpaid employment or occupations. 2. These data were made available by the Inter-University Consortium for Political and Social Research. The data were originally collected by the U.S. Department of Health and Human Services. The authors bear sole responsibility for the analyses and interpretations presented here. 3. There is also substantial intercorrelation among the three categorical measures in Table 3: .80 (Spearman coefficient) between work level and self-report. .48 between work level and pension, and .60 between self-report and pension. 4. Interestingly, the entire subject of post-retirement employment or partial retirement is oxymoronic with an exit-criterion definition of retirement. 5. Gibson (1987) has argued, however, that researchers and policy analysts should not overlook the experience of persons whose occupational and economic disadvantages make their retirement statuses hard to define.

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