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Effect of Workforce Age on Quantitative and Qualitative Organizational Performance: Conceptual Framework and Case Study Evidence

Author

Listed:
  • Uschi Backes-Gellner

    () (Department of Business Administration, University of Zurich)

  • Martin R. Schneider

    () (Economic Department, University of Paderborn)

  • Stephan Veen

    () (Department of Business Administration, University of Zurich)

Abstract

Field studies linking workforce age to performance tend to treat performance as one-dimensional and often focus on individual, not organizational performance. To analyze the effects of workforce age on organizational performance, we suggest treating performance as multi-dimensional with at least two output dimensions: quantity and quality. We provide a novel conceptual framework that borrows insights from multiple disciplines to better understand ageing phenomena in organizations. In particular, we build on psychological and medical studies showing that individual age has different effects on different cognitive capabilities. As a result we argue that workforce ageing may affect various performance dimensions, such as quantity and quality, in different, often opposite ways. In our empirical part we examine a unique dataset containing detailed court data over a time span of 19 years. We find that average workforce age is linked negatively to quantitative organizational performance but positively to qualitative organizational performance. Our findings suggest that future organizational studies should decompose performance at least along the quantity-quality dimension. Our theoretical framework helps to understand the different types of ageing effects and to derive itemized implications for changes in organizational performance. It also helps to reconcile contradictory findings of previous studies and to derive important managerial implications for task assignments, career policies, and company strategies in view of upcoming demographic changes in many developed countries.

Suggested Citation

  • Uschi Backes-Gellner & Martin R. Schneider & Stephan Veen, 2011. "Effect of Workforce Age on Quantitative and Qualitative Organizational Performance: Conceptual Framework and Case Study Evidence," Working Papers 0143, University of Zurich, Institute for Strategy and Business Economics (ISU).
  • Handle: RePEc:iso:wpaper:0143
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    File URL: http://repec.business.uzh.ch/RePEc/iso/ISU_WPS/143_ISU_full.pdf
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    Citations

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    Cited by:

    1. Richter, Doreen, 2014. "Demographic change and innovation: The ongoing challenge from the diversity of the labor force," management revue. Socio-economic Studies, Rainer Hampp Verlag, vol. 25(3), pages 166-184.
    2. Uschi Backes-Gellner & Stephan Veen, 2013. "Positive Effects of Ageing and Age-Diversity in Innovative Companies - Large Scale Evidence on Company Productivity," Economics of Education Working Paper Series 0093, University of Zurich, Department of Business Administration (IBW).
    3. 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.
    4. 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.
    5. Uschi Backes-Gellner & Martin R. Schneider, 2011. "Economic Crises and the Elderly," Working Papers 0142, University of Zurich, Institute for Strategy and Business Economics (ISU).
    6. 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.
    7. Jisung Park & Seongsu Kim, 2015. "The differentiating effects of workforce aging on exploitative and exploratory innovation: The moderating role of workforce diversity," Asia Pacific Journal of Management, Springer, vol. 32(2), pages 481-503, June.

    More about this item

    Keywords

    ageing workforce; demographic change; organizational performance; age productivity effects;

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions
    • J7 - Labor and Demographic Economics - - Labor Discrimination

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