Unraveling the impact of workforce age diversity on labor productivity: The moderating role of firm size and job security

Abstract

Previous literature has suggested both positive and negative effects of age diversity on labor productivity: positive because of the potential knowledge complementarities between employees of different ages and negative because of the age-related value differences that might reduce cohesion and cooperation, hampering firm performance. Using a Belgian sample of 5892 organizational observations (2008-2011), we unraveled these countervailing effects in two ways. First, we built on prior studies to suggest that the effect of age diversity depends on the particular shape of the age distribution: positive when it is heterogeneous (i.e., variety) and negative when it is polarized (i.e., polarization). This was supported by our findings. Second, we explored the moderating impact of two contextual contingencies, firm size and job security. As expected, the positive effect of age variety is reinforced in large firms and in firms where job security is high. Although firm size also emphasizes the negative effect of age polarization on productivity, job security, unexpectedly, does not moderate this relationship. Our study offers a valuable contribution to the literature as it reveals the boundary conditions of the competing implications of age diversity and, thus, allows one to account for the inconclusive findings reported in previous literature.

Subgroups in Agile and Traditional IT Project Teams

“…We show that identity-based factors like gender and age do not lead to the formation of subgroups. This is opposed to previous findings in other domains [56,57]. We do not find support that identity-based factors like gender and age lead to the formation of subgroups.…”

The Workplace Intergenerational Climate Scale (WICS): A self‐report instrument measuring ageism in the workplace

“…Additionally, insights from large‐scale, multi‐organizational use of the WICS could add to a growing body of research on conflicting impacts of age diversity on workplace productivity (see Boehm & Kunze, ). De Meulenaere, Boone, and Buyl () showed that age variety's positive impact on productivity was strengthened in larger firms and those with higher job security, and called for more research on moderators of age diversity, including ones that could be affected by human resources policy. Kunze, Boehm, and Bruch () found top managers' lack of negative age stereotypes and the presence of diversity‐friendly human resources policies were organizational‐level moderators of the impact of negative age‐discrimination climate on organizational performance.…”

Knowledge transfer in age‐diverse coworker dyads in China and Germany: How and when do age‐inclusive human resource practices have an effect?

“…Knowledge transfer in age-diverse coworker dyads refers to the process whereby two employees who belong to different age groups exchange knowledge with each other, for example, via discussion, imitation, and cooperation (Gerpott, Lehmann-Willenbrock, & Voelpel, 2017). The topic has recently gained importance because demographic changes have altered the age composition of workforces (Shultz & Adams, 2007): First, age diversity is increasing, which means that, in some companies, members of up to four different generations are working side-by-side, thus providing numerous opportunities for interactions between age-diverse coworkers (King & Bryant, 2017;De Meulenaere, Boone, & Buyl, 2016). Second, the number of older workers is increasing, requiring organisations to find ways to retain the valuable knowledge of older workers before they enter retirement (Burmeister & Deller, 2016).…”