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CAUT Bulletin Archives

October 2001

Early Retirement Trend Prevails

The age at which people retire from their jobs has been dropping since the mid 1970s and early retirement is now more common than a decade ago, concludes a new Statistics Canada report.

The study, Early Retirement Trends, examines what factors have influenced early retirement rates in the past decade, and paints a statistical portrait of workers who retire before the age of 60.

The report says during the early 1990s, the overall rate of early retirement increased from 30 per cent at the outset, until 1997, when 46 per cent of all workers who retired did so before they were 60. Since 1997, the overall rate has declined, reaching about 43 per cent in 2000.

One reason quoted as attributing to the surge in early retirement seen in the 1990s was government downsizing — "a phenomenon that has virtually ceased." Many older public servants were encouraged to take early retirement packages and in 1997, 65 per cent of those who retired were under 60.

This rate declined slightly to 63 per cent between 1997 and 2000, but it was still nearly twice the rate in the private sector.

The propensity to retire early was driven not only by trends in public sector employment. It also appears to have been linked to financial factors, specifically the existence of a pension plan or other means of supplementary retirement income. Retired workers who had accumulated savings or pension benefits were more likely to retire before 60 because they didn't need to rely on benefits from the Canada or Quebec pension plans.

From 1997 to 2000, early retirement was also more common among highly educated workers as well as among workers with full-time jobs, and more women than men retired early. The study also reveals the Atlantic provinces had much higher rates of early retirement than the rest of the country, and western Canada had the lowest rates of early retirement.

Early Retirement Trends was published in the September 2001 issue of Perspectives on Labour and Income, Labour Statistics Division, Statistics Canada.