Do Older Workers Lower IT-Enabled Productivity? Firm-Level Evidence from Germany

Summary The paper provides empirical evidence for the question whether firms’ IT-enabled labour productivity is affected by the age structure of the workforce. We apply a production function approach with heterogenous labour to firm-level data from German manufacturing and services industries. We find that workers older than 49 are not significantly less productive than prime age workers, whereas workers younger than 30 are significantly less productive than prime age workers. Older workers using a computer are significantly more productive than older non-computer users. The positive and significant relationship between labour productivity and IT intensity is not affected by the proportion of older workers.