Eliana Viviano (Bank of Italy)
Jonas Fluchtmann, Patrick Bennett, Alexander Hijzen, Eliana Viviano, Cesar Barreto, Felipe B. Caires, Lucas Chen, Jose Garcia-Louzao, Dogan G¨ul¨umser, Salvatore Lattanzio, Benjamin Lochner, Stefano Lombardi, Tahsin Mehdi, Jordy Meekes, Balazs Murakozy, Marco G. Palladino, Kjell Salvanes, Oskar Nordstr¨om Skans, Rune Vejlin, Wouter Zwysen
This paper analyses how workforce ageing has tended to slow aggregate wage and productivity growth by dampening growth-enhancing job reallocation. Using linked employer-employee data for 17 countries, we offer three key insights. First, growth-enhancing job reallocation accounts for about a fifth of aggregate wage and productivity growth. This process is mainly driven by job-to-job mobility (job ladder) of younger workers. Second, since older workers are less mobile than younger workers, they contribute less to growth-enhancing job reallocation. Third, given the rising employment share of older workers, workforce ageing has depressed aggregate wage and productivity growth through growth-enhancing job reallocation. A shiftshare decomposition shows that this amounts to 0.12 percentage points lower annual aggregate wage and productivity growth over the 2000s and 2010s.