Aging Workforce, Pension Reform, a nd Firm’s Dynamics (with Francesca Carta and Till von Wachter)
Abstract:
We exploit unique e
mployer-employee data combined with balance sheet information covering 4000
Italian firms for the period 2005-2015 to analyze the short-run impact of
a higher retirement age on: i) turnover and wages of workers of different a
ge classes, ii) capital and iii) productivity levels. To obtain exogenous f
irm-level variation in the shares of elderly workers we exploit an unantici
pated pension reform taking place in 2012 and restricting public pension el
igibility criteria in different ways for workers belonging to different dem
ographic groups. We find that the increase in the number of elderly workers
has a positive impact on employment levels of workers of other age classes
, confirming the presence of complementarities already found in studies car
ried out at more aggregate levels. Turning to wages, the increased supply o
f elderly workers implies a reduction in their daily pay, but has no impact
on compensation for the rest of the workforce. Finally, an ageing workforc
e is associated in the short run to an increase in total capital and produc
tivity levels, but a reduction in their per-worker amounts.