The central theme of this book is labour market change, its interrelationship with welfare policies, and their joint impact on citizenship. In this chapter we discuss these changes from the perspective of ageing workers. Labour market and social policies have had a major impact on the organisation of the end of the worklife for this sector of the population in the past decades. In many welfare states, social programmes have been used – as instruments for labour market strategies – to ‘externalise’ older workers from the labour market. This process is referred to as the ‘early exit’ of older workers.

Recently, this policy has been reversed. Many welfare states have tried to change the early exit culture into a late exit culture, to cope with demographic ageing, welfare state costs and new demands on the labour market. Instead of ‘externalisation’ of older workers, the political target nowadays is the ‘re-integration’ of older workers.

Against the background of these developments and changes we will address two questions. Firstly, whether and how countries will be able to turn around the massive and highly institutionalised early exit into a new pattern of late exit. We assume that this change from early to late exit needs a much more complicated and fundamental change in the regulating mechanism of welfare states than is sometimes expected. At the same time, and according to the neo-institutionalist approach, dismantling a (longstanding) welfare state practice might be very difficult as a result of ‘policy feedback’ and ‘path dependencies’ (Pierson, 1994). The empirical test should be those welfare states that combine a longstanding culture of high early exit with a complex institutional structure designed to channel the process of early exit. Within the European region a number of countries seem to qualify for such a test. For empirical reference we will use France and the Netherlands to analyse the barriers and innovations required to reverse the early exit trend. Both countries are known for their high early exit cultures, but they seem to differ strongly in the success of their attempts to raise the employment activity rates of older workers. Finland is also a high exit country with a complex pathway structure. From 1995, employment activity rates among the 55-64 male age group began to increase again, in the Netherlands from 40.5% in 1993 to 48.8% in 1999 (OECD, 2000), in Finland from 36.1% in 1995 to 40.1% in 1999.