Age Structure of Employment and Wages. An Analysis Across Occupational Groups

Recently, in most developed economies, the average age of the workforce has been growing rapidly. Therefore, the questions arise how will it affect the level of wages and the shape of age-productivity and age-wage profiles. The aim of the paper is to analyse the relationship between changes in the age structure of the employment and wages of individuals in minor occupational groups. Using individual data from the Structure of Earnings Survey in Poland in 2006-2014 we created an unique database of individual wages and the characteristics of employed in occupational groups at 3-digit level of classification. In our analysis we used an extended version of Mincerian wage model where both the characteristics of employees (education, work tenure, age, gender, and type of employment contract) and employers (size and ownership sector) were taken into account. The results for the whole sample indicate a significant and negative relationship between the proportion of older workers in employment in a given occupational group and individual wages. However, when the analyses were performed separately for each of the 1-digit occupational groups, the results varied significantly. In those groups where knowledge and qualifications of employees are more important than physical strength had to be updated permanently, an increase in the number of the older workers raises the average wages.