Diabetes and diabetes complications are a cause of substantial morbidity, resulting in early exits from the labour force and lost productivity. The aim of this study was to examine differences in early exits between people with type 1 and 2 diabetes and to assess the role of chronic diabetes complications on early exit. We also estimated the economic burden of lost productivity due to early exits.People of working age (age 17-64) with diabetes in 1998-2011 in Finland were detected using national registers (Ntype 1 = 45,756, Ntype 2 = 299,931). For the open cohort, data on pensions and deaths, healthcare usage, medications and basic demographics were collected from the registers. The outcome of the study was early exit from the labour force defined as pension other than old age pension beginning before age 65, or death before age 65. We analysed the early exit outcome and its risk factors using the Kaplan-Meier method and extended Cox regression models. We fitted linear regression models to investigate the risk factors of lost working years and productivity costs among people with early exit.The difference in median age at early exit from the labour force between type 1 (54.0) and type 2 (58.3) diabetes groups was 4.3 years. The risk of early exit among people with type 1 diabetes increased faster after age 40 compared with people with type 2 diabetes. Each of the diabetes complications was associated with an increase in the hazard of early exit regardless of diabetes type compared with people without the complication, with eye-related complications as an exception. Diabetes complications partly but not completely explained the difference between diabetes types. The mean lost working years was 6.0 years greater in the type 1 diabetes group than in the type 2 diabetes group among people with early exit. Mean productivity costs of people with type 1 diabetes and early exit were found to be 1.4-fold greater compared with people with type 2 diabetes. The total productivity costs of incidences of early exits in the type 2 diabetes group were notably higher compared with the type 1 group during the time period (€14,400 million, €2800 million).We found a marked difference in the patterns of risk of early exit between people with type 1 and type 2 diabetes. The difference was largest close to statutory retirement age. On average, exits in the type 1 diabetes group occurred at an earlier age and resulted in higher mean lost working years and mean productivity costs. The potential of prevention, timely diagnosis and management of diabetes is substantial in terms of avoiding reductions in individual well-being and productivity.