Are Older Workers Good for Business?

Abstract

The U.S. workforce is aging, which has raised concerns about the implications of older workers for businesses and the economy.  However, little research has been conducted on the quantitative value of older workers in recent years.  This paper attempts to fill that gap by linking employee and employer data from the U.S. Census Bureau’s Longitudinal Employer-Household Dynamics, Longitudinal Business Database, and Business Register.  The analysis finds that in general, older workers are as productive as younger workers, however they do earn higher wages.  Furthermore, the relationship between the share of older workers, productivity, and profitability varies substantially by industry.