July 01, 2004
Over 30 and over the hill
The title might be mis-leading because I am not over 30, but I read a very interesting article in the Economist this morning, during the typical Metro commute, regarding pay and productivity. The overall conclusion is that productivity and pay are not correlated. A study cited in the article showed that job performance peaked at 35. The only significant exception was female writers, who are most productive in their 50s. The following is from the Economist Print Edition, "Over 30 and over the hill," June 26th 2004
"Younger workers are underpaid and older workers overpaid relative to their productivity." - Vegard Skirbekk
"Technological change puts a premium on adaptability, and a discount on experience."
For those of you with online Economist access the article is here. For more indepth reading, see a study by Mr. Skirbekk here (PDF).
Posted by Jeremy Showalter at July 1, 2004 11:39 AMSo, at 27 I should expect to be paid more than my boss, who is in his 50's. I'll try running that one by him sometime next week. . .yeah, that's the ticket.
Interesting study, though. I hope that my company doesn't act on it as I get older. But at least I've still got 8 years left before I peak!
Posted by: Jacob at July 2, 2004 08:08 AMI doubt the article or study was suggesting that you immediately try to bring about a change in the differential between you and your boss.
I think your first line actually reveals exactly the attitude this article is talking about. You present yourself and your boss via two numbers - your age.
The real question is: am I/he paid according to our individual productivity (value)? In most cases the answer is clearly "no."
The article also discusses loyalty as a factor in paying older people - so that the younger people choose to stay...which seems to be part of the difference, but is hardly logical when compared to an alternative. I would be much more loyal to a company that compensated *me* based on productivity vs a company that compensated older workers as a motivating factor for *me* to stay. It just doesn't make sense.
Posted by: Jeremy at July 2, 2004 09:27 AM