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

38 Pages Posted: 10 Mar 2012

See all articles by Christian Pfeifer

Christian Pfeifer

Leuphana University of Lueneburg; IZA Institute of Labor Economics

Joachim Wagner

University of Lueneburg - Institute of Economics; Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Economics; IZA Institute of Labor Economics

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.

Keywords: ageing, firm performance, gender, productivity, profitability, Germany

JEL Classification: D22, D24, J21, J24, L25

Suggested Citation

Pfeifer, Christian and Wagner, Joachim, Age and Gender Composition of the Workforce, Productivity and Profits: Evidence from a New Type of Data for German Enterprises. IZA Discussion Paper No. 6381, Available at SSRN: https://ssrn.com/abstract=2019413

Christian Pfeifer (Contact Author)

Leuphana University of Lueneburg ( email )

Scharnhorststrasse 1
L√ľneburg, 21335
Germany

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Joachim Wagner

University of Lueneburg - Institute of Economics ( email )

PO Box 2440
D-21314 Luneburg
Germany
+49 4131 677 2330 (Phone)
+49 4131 677 2026 (Fax)

HOME PAGE: http://www.uni-lueneburg.de/wifo

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Economics ( email )

Kahlaische Strasse 10
D-07745 Jena, 07745
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
146
Abstract Views
1,026
rank
241,628
PlumX Metrics