Many Older Israelis Want to Continue Working After Pension Age, But Ageism and Finding Suitable Jobs Deter Them

By the sweat of your brow shall you get bread to eat, until you return to the ground, For from it you were taken. For dust you are and to dust you shall return.”




(the israel bible)

February 16, 2021

6 min read

In the US, many older people can work at salaried jobs as long as they like as long as their employer approves. In Israel, however, although both men and women may legally work until the age of 67 – the legal age for men is 67 and for women 62) to get a pension, the average retirement age among Israeli men is about 61 and among women 59. 

This is ironic and surprising, as life expectancy in this country is one of the highest in the world – an average of 83.04 years for both genders and 84.9 among females and 83.5 years among males. Most don’t object to raising the legal retirement age, and many – especially the highly educated – advocate it.

What are they supposed to do to keep themselves busy and active during all these additional years?

Germany was the first country to adopt a national pension program when Chancellor Otto von Bismarck called for one in 1889. He reputedly introduced a social security system to appeal to the German working class and combat the power of the Socialist Party in Germany during the late 1800s. The German system initially was intended for those 70 and older, but the starting age was lowered only in 1916 to 65 because when the retirement age was first introduced, hardly anyone lived that long.

The lowest official pension ages in the world are 58 for women in Turkey and 60 for men in Luxembourg, Slovenia and Turkey. Iceland, Israel (for men only) and Norway have the highest normal pension age at 67. In nine out of 35 leading countries, the pension ages still differ between men and women.

Now, a new study from the non-partisan, independent Taub Center for Social Policy Studies in Jerusalem looks at happiness among adults ages 60 to 80 and the socio-economic factors that influence them. Among other things, the study examines the division of time between work and leisure, volunteering, attitudes regarding the retirement age and the connection between happiness levels and various socio-demographic variables.

The lower the retirement age and the longer the life expectancy, the more difficult it is for the National Insurance Institute and pension plans to pay the sums to which the elderly are rightfully entitled.  Life expectancy in Israel has risen alongside increasing levels of good health, and with these developments comes an increase in the number of years that people continue to work. 

The study – conducted by Dr. Hila Axelrad of Tel Aviv University and IDC Herzliya; Prof. Israel Luski of Western Galilee College and Ben-Gurion University of the Negev in Beersheba; and Dr. Arie Sherman of Ruppin College – looks into the question whether the decision to continue working after retirement age borne out of necessity or choice.  Is there an interest among the elderly in changing the retirement age, and how does the decision to continue working affect levels of happiness? Do older people want to continue to working just to earn more money or does employment serve additional purposes?


The study shows that continuing employment after the legal age increases rather than decreases happiness levels as do relationships with a partner and having children. Israeli workers are not against raising the official retirement age, the researchers found. In fact, many of them want to continue working past that age, although they often retire early for a variety of reasons.

Rates of participation in the labor force in Israel are on the rise following a gradual increase in the official retirement age. Various studies show that more and more older adults show a desire to work longer, that they tend to stay at their place of employment longer than younger employees and are more loyal – characteristics that are advantageous to employers. 

Older employees are steadily learning how to use digital technologies such as the Internet, and they are often interested in refining those skills when given the opportunity. Another advantage of older workers is that their integration into the labor force serves to educate younger workers and leads to a decline in absenteeism and turnover among younger workers. 

Unfortunately, many adults who are interested and able to continue working encounter ageism – discrimination due to age – despite it being illegal. The difficulty older adults have in finding suitable work shows that the professional experience that they may bring to work is undervalued, and that for many employers, it doesn’t make up for what they may perceive as declining physical and mental abilities.

This phenomenon pushes productive adults with valuable experience to the margins of society margins and harms their earning power, the researchers wrote, contributing to a widening of the circle of poverty and the burden on welfare institutions. It even harms labor productivity and lowers the Gross Domestic Product. 

The Taub Center study is based on two databases, one from the Survey of Health, Ageing and Retirement in Europe (SHARE), which includes data from Israel on health, employment and social status between 2004 and 2016 among the non-ultra-Orthodox (haredi) Jewish population ages 60 to 80. The other is a data set built by the researchers specifically for this study using targeted questionnaires to examine the impact of employment on happiness levels in 2019. 

The analysis examined, among other things, the decision to retire or to continue working, changes in the employment level (full or part-time employment) and attitudes towards retirement policies. Haredi Jews and Arab Israelis were not included in the sample due to their unique employment characteristics.


The average age of survey respondents was 60; almost half were men, about 72% married, almost 70% Israel-born, about 73% secular, and about 56% still working.

According to data from the SHARE study, those who are still working showed significantly higher levels of happiness than those who retired. With increasing age, there was a drastic reduction in employment rates and some reduction in happiness levels. There were no significant differences between men and women, although the employment levels of women were substantially lower than those of men.

The principal influences on happiness levels were that employment in work that fosters development, as well as volunteering and having a partner and children. Looking at socio-demographic variables, the researchers found that happiness levels are highest among those who are in a relationship (whether or not they are working). It also rises with the number of children. The lowest levels of happiness are among those who are working and single and those who are not working and divorced. 


In addition, happiness levels are higher as income increases and with good health; poor health negatively impacts happiness levels both among those who are working and those who are not. There was no clear effect of gender, family status and higher education.


As for employment variables, the study showed that happiness levels are influenced primarily by type of employment. Employment that promotes individual growth (work that demands thought such as development, administration, and research) has a statistically significant positive influence on happiness levels, as does volunteering. Work under high pressure (work with constant time constraints, multitasking and deadlines) has a clear negative impact. The number of work hours also has an effect – long, high-pressure work hours lower happiness levels, while longer work hours in work with a growth element leads to greater happiness.

An international comparison shows that older unemployed adults in Europe are happier on average than those who are employed, while in Israel, there is no clear difference. In terms of type of employment, the impact is similar – work under high pressure harms happiness levels, while work that fosters personal growth raises them.

The researchers analyzed the question of retirement age and the factors that influence the decision to retire or to continue working in the survey questionnaire they designed. They found that the main reason to continue working after the age of 60 is to increase income. Other reasons are satisfaction from work, preserving human capital and work skills and social elements. The data show that more than half of those who retire from work do so voluntarily, and that they show happiness levels higher than the average.

The decision to retire stems from a number of factors: 22% gave reasons of health, 11% an expectation of lowered income should they continue to work, and 16% said it would be hard to find work in their field.


Health reasons have a substantial impact on the decision to retire, and poor health lowers the age of retirement by an average of 6.5 years. The average retirement age among women is about three years lower than for men, and difficulties in finding work lowers the age of leaving the work force by an average of more than atwo years, as does a willingness to make do with one’s current income. 

The researchers suggested that suitable policies that place an emphasis on improving health status and widening the supply of work positions for older adults could increase the employment rates substantially among this population.

“We found that early retirement from the labor market often stems from employment difficulties, and the tendency of many to seek employment in their field of expertise and at salary levels that they are used to,” noted Axelrad. “It is important to enforce the anti-ageism laws and to develop programs for vocational training for older adults as well. In addition, this subject should be explored among the Arab Israeli and haredi populations in Israel, in view of their special characteristics, to get a fuller picture of the situation in Israeli society.”

The Taub Center provides Israeli decisionmakers and the public with research and findings on some of the most critical issues facing the country in the areas of education, health, welfare, labor markets and economic policy so as to impact the decision-making process and promote the well-being of all Israelis.



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