“Older workers are often thought to be less productive” write Axel Börsch-Supan and Matthias Weiss in PRODUCTIVITY AND AGE: EVIDENCE FROM WORK TEAMS AT THE ASSEMBLY LINE published on mea.uni-mannheim.de.
“This impression is widespread and implicit in many discussions about aging, even in our economic textbooks. Often regarded as an established fact, it has profound implications for personnel policies by employers and retirement choices made by employees. In many countries, it is used as a motivation for early retirement policies. Moreover, if the impression were true, population aging will have negative effects on overall productivity as the share of older workers is increasing. The resulting effect on growth will amplify the economic strains on aging societies already exerted by increasing Social Security and Medicare bills.”
Their results
“Our findings show that the average age-productivity profile of individual workers is increasing until age 65. Decomposition into the effect of job tenure and age reveals that it is indeed experience that keeps older workers productivity from falling. A decomposition of our productivity measure into the frequency of errors and error severity shows that the older workers’ competence is their ability to avoid especially severe errors. While older workers are slightly more likely to make errors, they hardly make any severe errors. The results suggest that older workers are especially able to grasp difficult situations and then concentrate on the vital tasks.”
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