The Social Security Reform debate in Congress includes serious discussion on raising the nation's retirement age. Urban Institute research examines the arguments for and against increasing the retirement age, addressing the economic and social effects on older Americans, including those with low incomes and disabilities.
Raising Social Security's Retirement Age
Melissa Favreault and Richard W. Johnson
Increasing Social Security's retirement age would promote work at older ages, improve the system's solvency by shortening retirements and reducing lifetime benefits, and better target benefits to the oldest Americans. It could, however, create hardship for workers with health problems unless Congress improves the disability safety net. This fact sheet reports key data points in the arguments for and against increasing the retirement age.
The Big Balance: Raising the Retirement Age while Protecting Those Who Cannot Work
Gary Burtless, Howard Gleckman, Richard W. Johnson, Karyne Jones, Monique Morrissey, David Stapleton, and Frank Todisco
Panelists discuss how health status, job characteristics, and job prospects intersect to affect work at older ages. What will happen to Social Security if Americans do not extend their careers as life expectancy increases? Would raising Social Security’s early entitlement age or full retirement age hurt low-income groups? Can Social Security Disability Insurance adequately protect workers with health problems? Are there alternatives to raising the retirement age that would promote work at older ages?
The Implications of Career Lengths for Social Security
Melissa Favreault and C. Eugene Steuerle
Growing fiscal pressures and increasing life expectancy have prompted calls to raise retirement ages. Some fear this change might harm long-career, lower-wage workers. Tying retirement benefit eligibility to years of service might protect low-wage workers who start their careers early. But higher disability rates and greater employment volatility could offset lower-wage workers' early labor force starts. Using survey data matched to administrative records, we describe how work histories vary by gender, education, and other characteristics. We find that years of service are not likely to effectively protect the lowest-wage workers, as those with the least education also work the least.
Would Raising the Social Security Retirement Age Harm Low-Income Groups?
Gordon Mermin and C. Eugene Steuerle
Social Security's projected financial shortfall has spurred discussions about increasing the age at which workers can first receive retirement benefits. This brief examines the future distributional impacts of raising the retirement age by about three years. Raising the retirement age hits lower-income workers less hard than other groups because the disability program provides some protection. However, it still increases poverty rates. Combining the retirement age change with an enhanced minimum benefit increases lifetime benefits for the lowest earners and substantially cuts the Social Security deficit without significantly increasing poverty rates.
Additional Reading
Work Impediments at Older Ages
Employer Motivations for Hiring and Retaining Older Workers
Read more in our Social Security Overview at retirementpolicy.org
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