Despite a growing body of research, the effects of retirement on health are not clear. The study explores the role played by the path out of the labour market (formal retirement vs. unemployment or family reasons), accounting for individual heterogeneity. Methods: Propensity score matching approach is employed on longitudinal data from the Survey of Health, Ageing and Retirement in Europe (2004–2015). Results: While health does not change significantly for those who formally retire, it worsens considerably for those who leave the labour market for other reasons. Moreover, health outcomes turn out to be highly heterogeneous, depending on individual socio-economic and job-related characteristics. Discussion: Leaving the labour market in one’s mature years is a complex transition. Future research should focus on understanding and combating the causes of premature exit from the labour market, a relevant concern both in economic terms and on health grounds, in the light of our results.
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