After early retirement: the variety of human-resource strategies of firms towards older employees

Over the last years, the employment rate of older workers has increased sharply in Germany. Against this background, the question arose as to whether firms have contributed actively to the growing share of older employees, either by offering special human resource management (HRM) measures, such as further training (internal strategy) or by hiring older employees from the external labour market (external strategy). Our paper analyses the interrelation between both strategies. By using data from the IAB Establishment Panel, we investigate the determinants of the firms' decision to use one or the other strategy or to combine both strategies. Our analyses show that some factors, such as firm size, experiences with older staff or a shortage of skilled workers promote the decision for both strategies. Other characteristics, in contrast, have a positive effect on one strategy only. This applies in particular to industrial relations, but also to the share of qualified workers within a company.