2012/10/02 by Bernhard Mahlberg, Inga Freund, Jesús Crespo Cuaresma +1
Economics, Econometrics and Finance · Health Professions · Social Sciences · #Global Health Care Issues #Labor market dynamics and wage inequality #Retirement, Disability, and Employment
paper · pdf · doi:10.1016/j.labeco.2012.09.005
openalex publication_date 2012/10/02 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/01
Current demographic developments in industrialized countries and their consequences for workforce ageing challenge the sustainability of intergenerational transfers and economic growth. A shrinking share of the young workforce will have to support a growing share of elderly, non-working people. Therefore, the productivity of the workforce is central to a sustainable economic future. Using a new matched employer-employee panel dataset for Austrian firms for the period 2002-2005, we study the relationship between the age structure of employees, labour productivity and wages. These data allow us to account, simultaneously, for both socio-demographic characteristics of employees and firm heterogeneity, in order to explain labour productivity and earnings. Our results indicate that firm productivity is not negatively related to the share of older employees it employs. We also find no evidence for overpayment of older employees. Our results do not show any association between wages and the share of older employees. Furthermore, we find a negative relationship between the share of young employees and labour productivity as well as wages, which is more prevalent in the industry and construction sector.