Labor Participation and Depression among the Elderly

Background and Purpose: As part of an effort to prepare for the ageing society, many OECD countries have formulated several long-term strategies. One of such plans involves the sustainment of employment among the aged, restricting pathways to early retirement and promoting gradual transitions to retirement. Retaining old workers in the labor market is considered effective in reducing the public expenditures. However, one may question the effectiveness of such approach. This is particularly relevant in Korea where the employment rate of the aged is the highest among OECD countries. Given that many of the aged remain in the market mainly for the reasons of economic sustainment due to the yet stabilized social security system, it is plausible that strategies to elongate the employment period may not be desirable as work itself may be a source of great psychological stress. This paper thus examines the relationship between their employment and depression. In doing so, the paper can provide an empirical basis on which better intervention policies can be developed for the aged in Korea as well as Asia.

Method: Using Korean Longitudinal Study of Ageing (KLSA), this study examines the relationship between the labor market participation of the aged and depression. The analyses comprise of two main parts: first, the relationship between the two is examined using structural equation modeling (SEM) and second, the relationship is examined between the two age groups, those below 65 years of age and the above using multi-group analysis to see if any differences exist in the level of depression between the age groups.

Results: The model fit of the full path model was considered satisfactory given that the model yielded RMSEA of .057, IFI and CFI values of .964 with chi-square value of 1645.276 (df=76, p<.05). The findings show that variables that were significant in predicting the level of depression among the aged were employment status (ß=-.03), household income(ß =-.04), health status(ß =-.44), education(ß =-.4), marital status(ß =-.11), and participation in social activities(ß =-.12). The result of the multi-group analyses, however, shows that while other socio-demographic variables remain to have the same effect on both the below 65 and above 65 groups, the employment status affects the depression level only in the below 65 age group.

Implications: This finding provides several critical implications for services for the elderly. As employment has been regarded as a crucial protective factor for the individuals' mental wellbeing, this study provides supportive finding that being employed reduces the likelihood of being depressed. However, the finding that being employed does not carry a significant meaning to the psychological wellbeing of those over 65 years of age indicates that the active ageing paradigm promoted may not be effective for the mental wellbeing of Korean aged individuals. Instead, the finding that participation in social activities and self-rated health play significant roles in protecting these individuals from depression shows that services connecting the individuals to various community agencies and organizations for involvement and promoting healthy behaviors may be more effective in protecting their mental health.