What Training? The Link between Older Workers and Innovation

Abstract

With sharply growing numbers of older workers (those aged 50 or over, the 50+) in the workplace, various challenges and opportunities have been identified. In this article, we examine the veracity of the emergent concerns about the deleterious effects on firm-level innovation with an aging workforce. Using survey (1,300 UK firms) data, we study innovation across three domains: new products, new processes, and new ways of marketing. The empirical findings show that the effect of an aging workforce on firm innovation is domain-specific. There is a small positive association between having an older workforce and a firm’s product and process innovativeness. However, there is a significant and negative correlation between an aging workforce and new ways of marketing. Next, we explore the possible mitigating effects of investment in training including both on-the-job (i.e., routine, role/task specific, in-work training) and off-the-job training (i.e., training that takes place outside normal working hours) on the above relationships. The empirical outcomes show that both forms of training have a positive moderating effect in terms of products and processes innovation which is statistically significantly when older workers were offered off-the-job training. However, the moderating effects of both forms of training in firms with an aging workforce on new ways of marketing are insignificant.