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Age and gender composition of the workforce, productivity and profits: Evidence from a new type of data for German enterprises

Christian Pfeifer () and Joachim Wagner ()

No 232, Working Paper Series in Economics from University of Lüneburg, Institute of 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 microeconometric 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 (search for similar items in EconPapers)
JEL-codes: D22 D24 J21 J24 L25 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-dem, nep-eff, nep-eur, nep-hrm and nep-lab
Date: 2012-02
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Working Paper: Age and Gender Composition of the Workforce, Productivity and Profits: Evidence from a New Type of Data for German Enterprises (2012) Downloads
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