Women with high digital skills, especially those with higher education and those who are self-employed, are less likely to retire early, according to a new study by the EU-funded WeLaR Project.
As digitalisation and automation accelerate, concerns arise that older workers may struggle to keep pace with new technologies, leading to early exit from the labour market. The WeLaR researchers sought to investigate whether increasing exposure to technology induces workers to retire prematurely and if possessing digital proficiency can mitigate this tendency.
The study did not uncover a straightforward correlation between technological advancements and early retirement, nor conclusive evidence that digital skills enhance an individual’s competitiveness and confidence, thus reducing the inclination to retire early. The decision to leave the labour market appears to depend on factors such as gender, education level, and job characteristics.
“During our research, we showed that women with advanced digital skills tend to delay retirement, particularly those with higher education backgrounds. And, knowing how to use digital tools can help older workers keep their jobs longer” explained Thuc Uyen Nguyen-Thi, co-author of the study and research fellow in the Labour Market department at the Luxembourg Institute of Socio-Economic Research. “It appears that advanced digital skills in this specific demographic are not just an asset, but an important factor that considerably lowers the propensity for early retirement.”
The WeLaR researchers, who analysed large European databases of labour market data, also found that in non-routine manual jobs, which often involve hands-on work, advanced digital skills do not influence the timing of retirement, likely because these positions are less reliant on technology. However, in occupations that involve cognitive tasks, digital proficiency significantly lowers the likelihood of early retirement for both men and women.
Interestingly male civil servants with high digital skills are more prone to exit the labour market early, a pattern not mirrored among women in similar roles.
“Our results show that digital skills can extend working lives in certain circumstances,” said Mikkel Barslund, study co-author and manager in the research group Work, Organisation and Social Dialogue at HIVA KU Leuven. “Investing in digital literacy and skill development could provide older workers with the tools they need to adapt to an increasingly digital workplace.”
The analysis suggests that initiatives enhancing skill development and digital literacy among older workers could help prevent early exits from the workforce. Such efforts could help societies address demographic challenges and technological advancements more effectively.
Thuc Uyen Nguyen-Thi, Mikkel Barslund, Ivana Ivkovic, Ana Milinkovic and Ilse Tobback. (2024). Effects of technological progress on the decision to retire early: Evidence for Europe (Deliverable D3.1). Leuven: WeLaR project 101061388–HORIZON.
The paper is available here.
