Multi‐level effects of human resource bundles on the performance of aging employees

Abstract

Previously, scholars have studied the need for implementing different human resource (HR) configurations that foster aging employees' outcomes, but there is a lack of evidence at the group level. Using the framework of Social Exchange Theory, coupled with the Selection, Optimization, and Compensation theory, we examine associations between bundles of HR practices, age (measured both as calendar age and proportion of an aging workforce), and performance, at both the individual and group levels. First, the outcomes of our multi‐level analysis show that bundles of maintenance‐enhancing HR practices are positively related to performance at both levels, whereas bundles of growth‐enhancing HR practices associate with performance only at the group level. Second, age relates positively to performance, both at the individual and group levels. At the group level, there is an inverted U‐shaped relationship between the proportion of an aging workforce and group performance, such that a group's performance benefits from the participation of older employees up to a maximum proportion of 56%. Finally, age negatively moderates the association between growth‐enhancing HR bundles and performance at both the individual and group levels. Results highlight the value of older employees for working organizations, and the importance of adopting HR practices that consider maintenance and growth‐related needs across the life‐span, while also providing useful theoretical and practical implications for Human Resource Development scholars and professionals.