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Are older workers really harmful to firm productivity?

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  • Are older workers really harmful to firm productivity?
  • Lee, Bokwon; Yang, Jae-Suk
  • Korea Advanced Institute of Science and Technology


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Title Are older workers really harmful to firm productivity?
Similar Titles
Material Type Reports
Author(English)

Lee, Bokwon; Yang, Jae-Suk

Publisher

Daejeon, South Korea:Korea Advanced Institute of Science and Technology

Date 2016-07
Pages 21
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Social Development < Population
Social Development < Employment
Holding KAIST

Abstract

This paper examines the impact of workforce aging on company productivity. We use data from the Korean Workplace Panel Survey, which has been approved by the Korean government and conducted by the Korea Labor Institute. We find that an increase in the ratio of workers aged over 50 years to total workers has a negative impact on value added per worker, which is consistent with the findings of most previous studies based on European data. However, for large marginal or growing companies in the manufacturing industry, an increase in the ratio has a positive impact on value added per worker. This implies that raising the retirement age can be beneficial for productivity in marginal or growing companies. Therefore, financially troubled companies should be very cautious about laying off long-term workers because they may be essential for business success.