Employment transitions and computer use of older workers

Abstract

Our empirical analysis studies the impact of computer use on out of employment transitions of older workers, disentangling the effect of using a Personal Computer (PC) at work from that of being PC literate. Data are drawn from the 2000, 2002 and 2004 waves of the Bank of Italy Survey on Household Income and Wealth. We provide empirical evidence that, even controlling for a wide set of covariates, older employees who use a PC at work have a higher probability of remaining employed in the future. However, our results also indicate that, once PC literacy is controlled for, the use of a PC at work decreases only marginally the risk of becoming not employed (i.e. the effect is smaller than the one registered when we do not control for PC literacy).

Keywords:

• retirement
• skill-biased technological change
• ageing
• labour supply

JEL Classification:

• J26
• J24
• J14

Acknowledgements

This article is previously circulated as ‘Technology, Skills and Retirement’, Marco Fanno Working Paper, University of Padua. The authors gratefully acknowledge the financial support from the MIUR, the University of Padova and the EU-grants COMPARE (research contract no. CIT5-028857) and SHARELIFE (research contract no. CIT4-028812). We wish to thank the editor, an anonymous referee, Lorenzo Cappellari and the participants at the SIEP Conference (2006), the ECINEQ Meeting (2007), the EALE Conference (2007) and at the seminars given at the Universities of Padua, Milan (Università Cattolica del Sacro Cuore and University of Milano-Bicocca) and at the University of Balearic Islands (Palma de Mallorca). The Bank of Italy's SHIW used in this article is publicly available at www.bancaditalia.it.

Notes

¹ See Banca d’Italia (2002) for further details.

² The longitudinal section of SHIW is a rotating panel.

³ Individuals with the same actual level of PC skills may provide different self-assessments of their knowledge due to different reporting styles.

⁴ Our results are confirmed even conditioning on an alternative set of control factors including labour income and other household income. This set of results is available upon request.

⁵ Data are downloadable from the websites www.inps.it and www.inpdap.it.