QUANTITATIVE EASING AND SENIOR WORKFORCE RESTRUCTURING: A Labor Liability Transmission Channel Evidence from 82 Firms across Twelve Countries (2005-2024)

ABSTRACT This paper identifies and quantifies an undocumented transmission channel of Quantitative Easing (QE) policies: the financialized restructuring of senior employment. Between 2008 and 2024, G4 central banks expanded their balance sheets by over $25 trillion, compressing real interest rates to near-zero levels for more than a decade. Using a panel of 82 publicly listed firms (parent companies) across twelve countries (2005-2024) and exploiting exogenous variation in QE exposure through pre-crisis debt maturity structures, we estimate that firms in the top quartile of QE exposure increased their probability of implementing early retirement schemes for workers over age 55 by 4.2 percentage points (a 48% increase relative to the baseline mean of 8.7%). A calibrated discounted cash flow model using O*NET 2024 wage distributions confirms that under zero real rates, the net present value of replacing a 55-year-old senior worker exceeds €400,000, with substantial variation across occupations (range: €185,000 for Teaching Assistants to €1,200,000+ for Software Developers). Equity markets reward restructuring announcements with cumulative abnormal returns of +1.24% to +2.85%, with effects concentrated among high-QE-exposure firms. Each displaced senior worker generates negative fiscal externalities estimated at €142,000 in net present value over ten years, representing an implicit transfer from the public sector to corporate shareholders. These findings reveal a novel labor liability restructuring channel of monetary policy with profound implications for fiscal sustainability and intergenerational equity. JEL Codes: E52, E58, J26, J63, G32, H55 Keywords: Quantitative Easing, Labor restructuring, Insider-Outsider theory, Early retirement, Fiscal externalities, Demographic aging, Occupational wage distribution