Who Works for Startups? The Relation between Firm Age, Employee Age and Growth

57 Pages Posted: 22 Mar 2010 Last revised: 29 Oct 2014

See all articles by Paige Ouimet

Paige Ouimet

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School

Rebecca Zarutskie

Federal Reserve Board

Multiple version iconThere are 3 versions of this paper

Date Written: August 3, 2013

Abstract

Young firms disproportionately employ young workers, controlling for firm size, industry, geography and time. The same positive correlation between young firms and young employees holds when we look just at new hires. On average, young employees in young firms earn higher wages than young employees in older firms. Further, young employees disproportionately join young firms with greater innovation potential and that exhibit higher growth, conditional on survival. These facts are consistent with the argument that the skills, risk tolerance, and career dynamics of young workers are contributing factors to their disproportionate share of employment in young firms. Finally, we show that an increase in the regional supply of young workers is positively related to the rate of new firm creation, especially in high tech industries, suggesting a causal link between the supply of young workers and new firm creation.

Suggested Citation

Ouimet, Paige and Zarutskie, Rebecca, Who Works for Startups? The Relation between Firm Age, Employee Age and Growth (August 3, 2013). Available at SSRN: https://ssrn.com/abstract=1571609 or http://dx.doi.org/10.2139/ssrn.1571609

Paige Ouimet

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School ( email )

McColl Building
Chapel Hill, NC 27599-3490
United States

Rebecca Zarutskie (Contact Author)

Federal Reserve Board ( email )

20th Street and C Streets NW
Mailstop 155-B
Washington, DC 20551
United States
202-452-5292 (Phone)

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