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Ageing, productivity and wages in Austria

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  • Mahlberg, Bernhard
  • Freund, Inga
  • Crespo Cuaresma, Jesús
  • Prskawetz, Alexia

Abstract

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.

Suggested Citation

  • Mahlberg, Bernhard & Freund, Inga & Crespo Cuaresma, Jesús & Prskawetz, Alexia, 2013. "Ageing, productivity and wages in Austria," Labour Economics, Elsevier, vol. 22(C), pages 5-15.
  • Handle: RePEc:eee:labeco:v:22:y:2013:i:c:p:5-15 DOI: 10.1016/j.labeco.2012.09.005
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    Cited by:

    1. Rycx, Francois & Saks, Yves & Tojerow, Ilan, 2016. "Misalignment of Productivity and Wages across Regions? Evidence from Belgian Matched Panel Data," IZA Discussion Papers 10336, Institute for the Study of Labor (IZA).
    2. Kampelmann, Stephan & Mahy, Benoît & Rycx, Francois & Vermeylen, Guillaume, 2016. "Who Is Your Perfect Match? Educational Norms, Educational Mismatch and Firm Profitability," IZA Discussion Papers 10399, Institute for the Study of Labor (IZA).
    3. Alfred Garloff & Rüdiger Wapler, 2013. "Are the Number of Skilled Workers Running Out in Germany? The (Non)-Consequences of Demographic Change," ERSA conference papers ersa13p854, European Regional Science Association.
    4. Bloom, David E. & Sousa-Poza, Alfonso, 2013. "Ageing and Productivity: Introduction," IZA Discussion Papers 7205, Institute for the Study of Labor (IZA).
    5. François Rycx & Yves Saks & Ilan Tojerow, 2015. "Does Education Raise Productivity and Wages Equally? The Moderating Roles of Age, Gender and Industry," Working Paper Research 281, National Bank of Belgium.
    6. Garloff, Alfred & Wapler, Rüdiger, 2016. "Labour shortages and replacement demand in Germany : the (non)-consequences of demographic change," IAB Discussion Paper 201605, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    7. Frank T. Denton & Byron G. Spencer, 2017. "What Rates Of Productivity Growth Would Be Required To Offset The Effects Of Population Aging? A Study Of Twenty Industrialised Countries," Department of Economics Working Papers 2017-08, McMaster University.
    8. Börsch-Supan, Axel & Weiss, Matthias, 2016. "Productivity and age: Evidence from work teams at the assembly line," The Journal of the Economics of Ageing, Elsevier, vol. 7(C), pages 30-42.
    9. John S. Heywood & Uwe Jirjahn, 2015. "The German Labor Market for Older Workers in Comparative Perspective," Research Papers in Economics 2015-02, University of Trier, Department of Economics.
    10. Aisa, Rosa & Larramona, Gemma & Pueyo, Fernando, 2015. "Active aging, preventive health and dependency: Heterogeneous workers, differential behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 117(C), pages 1-9.
    11. repec:ejn:ejefjr:v:5:y:2017:i:2:p:36-50 is not listed on IDEAS
    12. Romina Giuliano & Stephan Kampelmann & Benoît Mahy & François Rycx, 2017. "Short Notice, Big Difference? The Effect of Temporary Employment on Firm Competitiveness across Sectors," British Journal of Industrial Relations, London School of Economics, vol. 55(2), pages 421-449, June.
    13. Crespo Cuaresma, Jesus & Loichinger, Elke & Vincelette, Gallina A., 2016. "Aging and income convergence in Europe: A survey of the literature and insights from a demographic projection exercise," Economic Systems, Elsevier, vol. 40(1), pages 4-17.
    14. Maciej Lis, 2017. "Productivity based selection to retirement: Evidence from EU-SILC," IBS Working Papers 02/2017, Instytut Badan Strukturalnych.
    15. Rauf Gönenç & Oliver Röhn & Christian Beer & Andreas Wörgötter, 2013. "Responding to Key Well-being Challenges in Austria," OECD Economics Department Working Papers 1080, OECD Publishing.
    16. Liis Roosaar & Jaan Masso & Urmas Varblane, 2017. "The Structural Change And Labour Productivity Of Firms: Do Changes In The Age And Wage Structure Of Employees Matter?," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 103, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    17. N. N., 2015. "WIFO-Monatsberichte, issue 11/2015," WIFO Monatsberichte (monthly reports), WIFO, vol. 88(11), November.
    18. Peters, Cornelius, 2015. "Do age complementarities affect labour productivity? Evidence from German firm level data," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112941, Verein für Socialpolitik / German Economic Association.
    19. repec:tou:journl:v:45:y:2017:p:31-58 is not listed on IDEAS
    20. Bloom, David E. & Sousa-Poza, Alfonso, 2013. "Ageing and productivity," FZID Discussion Papers 63-2012, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    21. John S. Heywood & Uwe Jirjahn, 2016. "The hiring and employment of older workers in Germany: a comparative perspective
      [Die Beschäftigung und Neueinstellung älterer Arbeitnehmer in Deutschland: Eine vergleichende Perspektive]
      ," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 49(4), pages 349-366, December.
    22. Mahlberg, Bernhard & Freund, Inga & Crespo Cuaresma, Jesús & Prskawetz, Alexia, 2013. "The age-productivity pattern: Do location and sector affiliation matter?," ECON WPS - Vienna University of Technology Working Papers in Economic Theory and Policy 01/2013, Vienna University of Technology, Institute for Mathematical Methods in Economics, Research Group Economics (ECON).
    23. repec:eee:joecag:v:1-2:y:2013:i::p:72-82 is not listed on IDEAS
    24. Garloff, Alfred & Wapler, Rüdiger, 2016. "Labour Shortages and Replacement Demand in Germany. The (Non-)Consequences of Demographic Change," Annual Conference 2016 (Augsburg): Demographic Change 145497, Verein für Socialpolitik / German Economic Association.
    25. Martin Falk & Werner Hölzl & Harald Oberhofer, 2015. "The Importance of Firm-Level Data for Empirical Research and Economic Policy Consulting," WIFO Monatsberichte (monthly reports), WIFO, vol. 88(11), pages 845-857, November.

    More about this item

    Keywords

    Age–productivity/–wage profile; Employer–employee data; Sector affiliation;

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition

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