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Age and Gender Composition of the Workforce, Productivity and Profits: Evidence from a New Type of Data for German Enterprises

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  • Pfeifer, Christian

    () (Leuphana University Lüneburg)

  • Wagner, Joachim

    () (Leuphana University Lüneburg)

Abstract

This empirical paper documents the relationship between composition of a firm's workforce (with a special focus on age and gender) and its performance (productivity and profitability) for a large representative sample of enterprises from manufacturing industries in Germany. We use unique newly available data that for the first time combine information from the statistics of employees covered by social security that is aggregated at the enterprise level and information from enterprise level surveys performed by the Statistical Offices. Our micro-econometric analysis confirms previous findings of concave age-productivity profiles, which are consistent with human capital theory, and adds a new finding of a rather negative effect of age on firms' profitability, which is consistent with deferred compensation considerations. Moreover, our analysis reveals for the first time that the ceteris paribus lower level of productivity in firms with a higher share of female employees does not go hand in hand with a lower level of profitability in these firms. If anything, profitability is (slightly) higher in firms with a larger share of female employees. This finding might indicate that lower productivity of women is (over)compensated by lower wage costs for women, which might be driven by general labor market discrimination against women.

Suggested Citation

  • Pfeifer, Christian & Wagner, Joachim, 2012. "Age and Gender Composition of the Workforce, Productivity and Profits: Evidence from a New Type of Data for German Enterprises," IZA Discussion Papers 6381, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp6381
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    References listed on IDEAS

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    Cited by:

    1. Pfeifer, Christian & Wagner, Joachim, 2012. "Is Innovative Firm Behavior Correlated with Age and Gender Composition of the Workforce? Evidence from a New Type of Data for German Enterprises," IZA Discussion Papers 7050, Institute for the Study of Labor (IZA).
    2. Vandenberghe, V., 2013. "Are firms willing to employ a greying and feminizing workforce?," Labour Economics, Elsevier, vol. 22(C), pages 30-46.
    3. Stephan Humpert, 2012. "Age and Gender Differences in Job Opportunities," Working Paper Series in Economics 235, University of Lüneburg, Institute of Economics.
    4. Karsten Wasiluk, 2014. "Technology Adoption and Demographic Change," Working Paper Series of the Department of Economics, University of Konstanz 2014-05, Department of Economics, University of Konstanz.

    More about this item

    Keywords

    Germany; firm performance; gender; productivity; ageing; profitability;

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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