The Age Dispersion of Workers and Firm Productivity: A Survey Approach

Abstract

This paper investigates a tentative finding in recent literature that the age dispersion of workers matters for average firm productivity. The reason is not related to differences in the workers' age specific productivity levels. Rather it is that workers of different ages are complementary in their effects on average firm productivity. The approach is an econometric study for Australia using the only publicly available matched employee-employer data which is extracted from the AWIRS 95 survey, along with data from a small online pilot survey conducted for the purposes of this study. The results support the tentative suggestion from prior studies, using somewhat different methodologies, that a more widely dispersed workforce by age is positive for productivity. This may have implications for human resource management of firms and for public policy, for example in relation to immigration.