Country-level welfare-state measures and change in wellbeing following work exit in early old age: evidence from 16 European countries.

Background: Although the effects of individual-level factors on wellbeing change following work exit have been identified, the role of welfare-state variables at the country level has yet to be investigated.

Methods: Data on 8037 respondents aged 50 years and over in 16 European countries were drawn from the Survey of Health, Ageing and Retirement in Europe (SHARE) and the English Longitudinal Study of Ageing (ELSA). We employed multilevel models to assess determinants of change in wellbeing following work exit, using CASP-12 change scores. After adjusting for institutionally defined route and timing of work exit, in addition to other individual-level variables, we tested country-level variables including welfare-state regime and measures of disaggregated welfare spending to determine their associations with wellbeing change and the proportion of between-country variance explained.

Results: Individuals whose exit from paid work was involuntary or diverged from the typical retirement age experienced declines in wellbeing. Country effects accounted for 7% of overall variance in wellbeing change. Individuals residing in countries with a Mediterranean welfare regime experienced more negative changes in wellbeing, with a difference of -2.15 (-3.23, -1.06) CASP-12 points compared with those in Bismarckian welfare states. Welfare regime explained 62% of between-country variance. National per-capita expenditure on non-healthcare in-kind benefits (services) was associated with more positive wellbeing outcomes.

Conclusions: National expenditure on in-kind benefits, particularly non-healthcare services, is associated with more favourable wellbeing change outcomes following work exit in early old age. Welfare-state effects explain the majority of between-country differences in change in wellbeing.