1 Why Age Diversity Matters

Trends in many industrialized countries like low birthrates, increased longevity, and a disproportionally large generational cohort born after the Second World War (the so-called “Baby Boomers”; Craig & Paganelli, 2000) have caused a societal phenomenon often summarized as “demographic change” (Dychtwald, Erickson, & Morison, 2004; Tempest, Barnatt, & Coupland, 2002). This demographic change does not only have an impact on the age structures of many country populations but also on the age structures of the respective working populations and relatedly, also on the age structures of most firms and organizations. For instance, from 2006 to 2016, the age group of 55–64-year-old workers in the U.S. workforce is projected to increase by 37 % (U.S. Bureau of Labor Statistics, 2008).

Several further trends reinforce this development towards a more age-diverse workplace: First, in consideration of an increasing lack of qualified junior employees and the consequent “War for Talents” (Michaels, Handfield-Jones, & Axelrod, 2001), companies seem more willing to broaden their recruiting pool and to hire traditionally neglected applicants such as older workers. Second, due to the increasing pressure on pension systems, many countries aim at raising or have already raised the pension age (e.g., Germany and Austria). In line with this policy change, many organizations stopped their early retirement programs, significantly increasing the number of older employees in their workforces (Dychtwald et al., 2004). Third, in order to lower the labor force entry age, governments have introduced Bachelor and Master systems and/or have reduced the required years of schooling, again contributing to a higher age diversity in companies (Kaube, 2008). Consequently, the modern workplace appears more (age-)heterogeneous than ever.

Unfortunately, as we know from research on other diversity categories such as gender or ethnicity, age-diverse teams, units or organizations do not automatically reach higher levels of innovation, satisfaction, or productivity. Instead, as various reviews and meta-analyses of the literature have indicated, growing diversity often comes at the price of sub-group formation, raising conflicts, communication and coordination problems, as well as individual discontent, absenteeism, and turnover intention (Joshi & Rho, 2009; Shore et al., 2009; Van Dijk, Van Engen, & Van Knippenberg, 2012; Van Knippenberg & Schippers, 2007). In addition, such negative, diversity-triggered experiences (including age-based conflicts and age-discrimination) might also weaken the employment relationship that individuals perceive with their organization. Supporting this line of reasoning, Kunze, Boehm, and Bruch (2011) found that age diversity relates to the perception of an age-discrimination climate, which in turn, reduces members’ collective commitment to the organization and impairs company performance. Therefore, in order to profit from a “business case for diversity” (Robinson & Dechant, 1997), organizations have to better understand how to harvest the positive effects of age diversity while avoiding its negative implications.

Taken together, this chapter strives to systemically review current research on age diversity in organizations and to develop ideas for future research in this important area of organizational behavior.

2 In a Nutshell: Theoretical Foundations of Age-Diversity Research

In order to explore potential effects of age diversity in the workplace, some theoretical considerations including a construct definition are needed. Diversity has been defined as “[…] the distribution of differences among the members of a unit with respect to a common attribute, X, such as tenure, ethnicity, conscientiousness, task attitude, or pay” (Harrison & Klein, 2007, p. 1200). Consequently, age diversity as a specific form of diversity is a collective-level, compositional construct that reflects the age structure of a specific social entity, such as a team, a work unit, a company, or a whole country.

2.1 The Information/Decision-Making Perspective

Scholars proposing positive effects of (age) diversity in the workplace typically rely on cognitive resource models of variation (Campbell, 1960; De Dreu & West, 2001), also referred to as the “information/decision-making perspective” (Van Knippenberg & Schippers, 2007, p. 518) or functional, informational, or knowledge diversity (Jehn, Northcraft, & Neale, 1999; Pelled, Eisenhardt, & Xin, 1999; Van Knippenberg, De Dreu, & Homan, 2004). They argue that age-diverse group members possess different and often complementary resources such as diverse theoretical and practical knowledge (e.g., up-to-date theoretical knowledge of university graduates vs. broad work experiences of senior employees), skills (e.g., in terms of use of technology), or access to different social networks (e.g., various groups of customers, suppliers, etc.). As teams typically function as information processors (Hinsz, Tindale, & Vollrath, 1997) with a need for extensive information acquisition, discussion, and integration, age-heterogeneous teams are likely to outperform age-homogenous teams in terms of being more creative and innovative (Fiol, 1994; Jackson, May, & Whitney, 1995), more adaptive to change, and less endangered to group think (Janis, 1972).

2.2 The Similarity-Attraction Paradigm and the Social Identity Approach

In spite of these potentially positive diversity effects, there are a number of theoretical concepts implying rather negative performance implications of rising (age) diversity. First, the similarity-attraction paradigm (Byrne, 1971) proposes that individuals prefer to interact with similar others (e.g., in terms of demographics, attitudes, or values) as they tend to get more affirmative feedback from those (Hinds, Carley, Krackhardt, & Wholey, 2000). Reduced uncertainty and higher trust levels among similar group members facilitate communication and coordination while the cooperation with diverse peers becomes more difficult. In the case of age, employees might prefer contact to similar aged colleagues with who they share more experiences, attitudes, or interests due to their similar life or career stage (Lawrence, 1980, 1988).

Second, the social identity approach (Tajfel & Turner, 1986; Turner, 1985) implies that individuals tend to classify themselves and others in certain groups on the basis of various dimensions perceived as personally relevant – including demographics such as age, gender or race (e.g., Avery, McKay, & Wilson, 2008; Finkelstein, Burke, & Raju, 1995; Kearney & Gebert, 2009). While members of the in-group are perceived as similar (e.g. employees of the same age group), members of potential out-groups are perceived as different – and in most cases – as inferior. As a consequence, they trust, communicate, and cooperate more with their in-groups members, while they potentially discriminate against out-group members (Brewer, 1979). Rising age diversity is likely to increase the salience of age as a category for in-group-out-group formation, thus making it more likely that employees discriminate against each other based on their age-group membership (Kunze et al., 2011).

2.3 Career Timetables and Prototype Matching

Two further theoretical concepts seem especially meaningful in explaining potentially negative effects of age diversity in the workplace. First, the concept of career timetables implies that within organizations certain age norms exist which indicate when a typical employee should reach a given career stage (Lawrence, 1988). While those “on schedule” or those “ahead of schedule” should face no age-related disadvantages, those “behind schedule” often struggle with certain forms of age discrimination such as lower performance ratings or reduced developmental opportunities (Lawrence, 1988; Tsui, Porter, & Egan, 2002). Similarly, the concept of prototype matching (Perry, 1994) suggests that jobs within organizations are often associated with “prototypical” job holders, i.e., jobs that are particularly suited for younger employees (e.g., in the IT industry) versus those more appropriate for older employees (e.g., senior management roles). Again, increasing age diversity seems likely to produce more situations within teams and firms where career timetables or job prototypes are violated (e.g., by young MBA graduates being promoted to senior roles, leading employees considerably older than themselves), leading to potential problems such as conflict or perceived discrimination.

2.4 Age-Based Faultlines

More recently, scholars started to investigate if potential effects of diversity may not only be triggered by a certain diversity category (e.g., age or gender), but rather by a combination of two or more demographic characteristics. Lau and Murnighan (1998, p. 327) coined the term “faultlines” to describe hypothetical dividing lines within teams that result from such an alignment of diversity categories and lead to an increased sub-group formation (Bezrukova, Jehn, Zanutto, & Thatcher, 2009). For instance, within a cross-functional team, age and educational diversity might interact in such way that all engineers are belonging to an older age group (such as the baby boomer generation) while all marketing professionals are comparably young (e.g., stemming from the generation Y). A more salient sub-group formation based on age and expertise might emerge, leading to the negative effects described above, compared to an exemplary team in which age and expertise are not aligned (both younger and older marketing and engineering experts). Due to their polarization and consequent separation potential, strong faultlines are expected to adversely affect group processes such as communication and knowledge exchange as well as group outcomes such as performance. In line with this assumption, recent meta-analytical (Thatcher & Patel, 2011) and quantitative aggregation results (Thatcher & Patel, 2012), building on 39 studies and more than 24,000 employees, have demonstrated that strong faultlines reduce team performance and team satisfaction, partly mediated by increased task and relationship conflict and decreased team cohesion. With regard to the sources of strong demographic faultlines, Thatcher and Patel’s analyses (2011) demonstrated that age bears the potential for the formation of faultlines, however, race and gender turned out to be stronger drivers of faultline creation (potentially because of the clearer classification and related categorization such as male/female).

3 Direct Effects of Age-Diversity in Organizational Settings

Based on these theoretical considerations, we now want to systematically review the literature on the age-diversity-outcome relationship. Therefore, we carried out a structured literature-search, screening the Web of Science and EBSCO databases in the fields of business, management, and psychology applied for the search term “age diversity” as well as related expressions (e.g., “group diversity”, “diversity management”, etc.). Using that search strategy, we are confident that we have identified the most relevant peer-reviewed articles on age diversity published within the last 25 years.

The following section strives to offer a coherent overview of empirical age-diversity research. We have clustered the identified studies around two dimensions. First, with regard to eight potential outcomes of age diversity, namely (1) performance, (2) innovation, (3) communication/information-sharing, (4) emotion regulation, (5) perceived age discrimination, (6) conflict, (7) health, and (8) absenteeism/turnover. Second, we clustered the studies with regard to the type of sample in which age diversity was calculated. We differentiate between (a) work groups/work teams, (b) top management teams (TMTs), (c) branches/decision making units (i.e. social entities which have certain autonomy in business decisions and processes, however, belong to a larger organization; e.g. super market stores belonging to one chain), (d) whole organizations/independent companies, as well as (e) meta analytical samples (that combine existing studies). Table 3.1 displays this overview as well as the effect of age diversity identified in these studies (none/positive/negative).

Table 3.1 Overview of studies on age diversity
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3.1 Age Diversity and Performance

As Table 3.1 indicates, the relationship of age diversity with performance gained by far the most scholarly attention. Studies were conducted in various organizational settings including regular workgroups, R&D-teams, TMTs of various industries, retail stores and banking branches, as well as samples of whole companies from different industries and countries. Also the conceptualization of performance differs, ranging from financial figures (such as return on assets or sales) to more operational indicators (such as customer satisfaction or employee retention). As shown in Table 3.1, the majority of studies on the work group-level and TMT-level suggest a neutral or negative relationship between age diversity and performance. As an exception, Kilduff, Angelmar, and Mehra (2000) found a positive association between age heterogeneity and overall performance in a sample of 35 TMTs. However, their empirical setting was a business simulation game what might restrict the external validity of this finding. Also on the branch/decision making unit level, studies report null or negative relationships. At the organizational level of analysis, the picture is more heterogeneous with studies identifying null-effects, negative, positive, as well as U-shaped relationships with performance.

Finally, there are three recent meta-analytical studies available that have investigated the age diversity-team performance relationship. Bell and colleagues (Bell, Villado, Lukasik, Belau, & Briggs, 2011) found no significant association between age diversity and performance when analyzing 10,646 teams from 35 field studies. In contrast, Joshi and Roh (2009) found a significant negative effect of age diversity on team performance of r = −.06. Interestingly, age diversity even showed the strongest negative effect of all diversity categories (gender, race, age, function, education, tenure). Most recently, Van Dijk and colleagues (2012) carried out a meta-analysis of 146 studies and found that age diversity was negatively related to subjective performance (r = −.10, p < 0.01) but not to objectively assessed performance.

3.2 Age Diversity and Innovation

Studies investigating the age diversity-innovation relationship have mostly found no significant or a negative effect. For instance, both Bantel and Jackson (1989) and Wiersema and Bantel found no effect of TMT age diversity on innovation or strategic change in samples of US banks and US Fortune 500 companies. At the branch level of analysis, Zajac, Golden, and Shortell (1991) found a negative relationship of age diversity with innovation in a sample of 53 internal corporate joint ventures in the hospital sector. Finally, at the organizational level of analysis, Ostergaard, Timmermans, and Kristinsson (2011) found a significant negative effect of age diversity on the firm’s likelihood to innovate in a sample of 1,775 Danish firms.

3.3 Age Diversity and Communication/Information Sharing

The relationship of age diversity with communication and information sharing has also been investigated in various studies with rather mixed results. Kearney and Gebert (2009) found no significant effect on the elaboration of task-relevant information in a sample of 62 R&D teams. Zenger and Lawrence (1989), in contrast, found a negative association as age diversity reduced the frequency of technical communication in a sample of 19 project groups of a US electronics firm. Finally, at the TMT level, Bunderson and Sutcliffe (2002) found age diversity to be unrelated to information sharing in business unit management teams.

3.4 Age Diversity and Emotion Regulation

Kim and colleagues (Kim, Bhave, & Glomb, 2013) investigated response-focused emotion regulation (i.e., surface acting, which involves modifying external expressions) as an outcome of age diversity and found a positive relationship in a sample of 274 work groups. This finding implies that working in age-diverse units involves some need for emotional labor and emotion suppression, potentially caused by negative feelings towards age-diverse group members.

3.5 Age Diversity and Perceived Age Discrimination

Kunze and colleagues (2011, 2013) focused on the construct of age discrimination climate, defined as collective perceptions of unfair, age-related treatment against any age group within an organization (2011, p. 265). They found in two organizational-level studies comprising 128 respectively 147 German companies that higher levels of age diversity are associated with higher levels of perceived age discrimination climate within these firms. Indirectly, age diversity also related negatively to firm performance, mediated by age discrimination climate.

3.6 Age Diversity and Conflict

Based on social identity theory and related processes of sub-group formation and mutual discrimination (Tajfel & Turner, 1986), conflict has often been proposed as a potential outcome of demographic diversity. The literature typically distinguishes between at least two types of conflicts, namely relationship and task conflicts (Amason, 1996; Jehn, 1995). Regarding relationship conflict, Jehn and colleagues (Jehn, Chadwick, & Thatcher, 1997) found no significant effect of age dissimilarity on relationship conflict in a quasi-experimental study using MBA workgroups as a sample. However, the comparably similar age of participants might have influenced this finding. In contrast, Jehn and colleagues (1999) found a positive association between social category diversity (composed of age and gender) and relationship conflict. Similarly, Pelled and colleagues (Pelled, Xin, & Weiss, 2001) found in a sample of 190 Mexican workers that employees who were dissimilar in age from other members of their work unit reported higher levels of emotional conflict. Yet, there is also empirical support for a negative relationship of age diversity with relationship conflict. Pelled and colleagues (1999) found such a negative association between age diversity and emotional conflict in a sample of 45 work units. They reason that in age heterogeneous teams, social comparison processes might be reduced, which in more age homogenous teams create conflict due to competition between similar-aged peers.

Regarding task conflict, Pelled et al. (1999) found no significant relationship with age diversity. Similarly, Pelled et al. (2001) found also no significant association in their Mexican sample.

3.7 Age Diversity and Health

Comparably little research has investigated health as a correlate of age diversity, what is at least surprising given the high practical importance of employee health. Only recently, Liebermann, Wegge, Jungmann, and Schmidt (2013) could demonstrate that age diversity within work teams is negatively related to individual employees’ health, however, this effect is significantly stronger for younger and older employees while middle-aged employees’ health is not negatively affected by age diversity.

3.8 Age Diversity and Turnover/Absenteeism

Absenteeism rates, turnover intention as well as actual turnover rates have mostly – but not always – been found to relate positively with age diversity, supporting the potentially negative effect of age diversity on the employment relationship described above. An exception is a study by Jehn and colleagues (1999) at the work group level of analysis that has identified an increased intent to remain for members of diverse (in terms of age and gender) work units. In contrast to these findings, O’Reilly, Caldwell, and Barnett (1989) as well as Tsui, Egan, and O’Reilly (1992) showed that age heterogeneity is positively associated with individual turnover respectively a lower intent to stay. Moreover, those employees being distant in age from an otherwise homogeneous group also showed significantly higher turnover rates.

At the TMT level, Jackson and colleagues (Jackson et al., 1991) found in a sample of 93 bank holding companies that age diversity was significantly and positively related with team turnover. Similar findings were obtained by Wiersema and Bird (1993) in a sample of 40 TMTs of Japanese stock-listed companies.

With regard to absenteeism, Cummings, Zhou, and Oldham (1993) showed a similar positive relationship with age diversity, implying that absenteeism rates might grow due to increasing age heterogeneity.

3.9 Preliminary Summary

Taken together, no clear picture of the effects of age diversity on various outcomes emerged in our summary. However, studies reporting an insignificant or even a negative relationship between age diversity and outcomes on various levels of analysis seem to predominate over those reporting a desirable effect of age diversity in the workplace. Consequently, processes related to social identity and similarity-attraction might dominate over those proposing advantages from a broader information and decision making base. Nevertheless, both research and practice have acknowledged the need to open the “black box of organizational demography” (Lawrence, 1997) and to study potential mediators and moderators that should shed more light on the question if and how age diversity really impacts organizational outcomes.

4 Moderators of the Age Diversity-Outcome Relationship

Given the rather contradicting findings on the effects of age diversity on various outcomes, it seems meaningful to investigate potential moderators that can foster the either positive or negative processes and effects related to increasing levels of age diversity in the workplace. Figure 3.1 summarizes these moderators.

Fig. 3.1
figure 1

A research model of age diversity and its effects on work outcomes

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4.1 Demographic Characteristics

First, based on the concept of relational demography (Riordan, 2000; Tsui et al., 1992), scholars assume that individuals compare their own demographic characteristics with those of the other members of their unit in order to decide if they are similar or dissimilar to the composition of the group. In cases where they are dissimilar, they tend to react negatively in terms of commitment, cooperation, job satisfaction or turnover (Chattopadhyay, Tluchowska, & George, 2004; Guillaume, Brodbeck, & Riketta, 2012; Tsui et al., 1992). Applying this idea to the context of age diversity, Liebermann and colleagues (2013) showed that an individual’s age can moderate the age diversity-health relationship. While for middle-aged employees who seem to be able to identify with all age groups, health was not negatively affected by age diversity, both younger and older employees’ health levels were negatively affected by raising age diversity.

Second, Van Dijk and colleagues (2012) demonstrated that the type of team leader/performance assessment might play a role in the age diversity-performance relationship. They found that age diversity only showed a negative relationship with performance when performance was rated by an external team leader, but not when it was assessed by internal team leaders, by team members, or by objective performance criteria.

Third, Li, Chu, Lam, and Liao (2011) showed that country of origin moderates the age diversity-firm performance link in such way that for firms from Western societies, this relationship is positive while for firms from East Asian societies, age diversity is not related to firm performance. This might hint to greater diversity awareness in Western societies together with a more pro-active way of dealing with age diversity in the respective firms.

4.2 Task Characteristics

The type of task has repeatedly been proposed as a key boundary condition of the (age) diversity-outcome relationship. For instance, Van Knippenberg et al. (2004) proposed that group heterogeneity can only contribute to performance in cases of complex and nonroutine information-processing and decision making tasks in which diverse groups can make use of their different experiences and knowledge bases (see also Bowers, Pharmer, & Salas, 2000).

A study by Jehn and colleagues (1999) found that social category diversity (composed of age and gender) led to greater satisfaction and commitment under conditions of high task interdependence. In the context of age diversity, Wegge and colleagues (Wegge, Roth, Neubach, Schmidt, & Kanfer, 2008) found in a sample of 222 public service teams that under conditions of high task complexity, age diversity was positively related to group performance and unrelated to health disorders. In contrast, for teams working on routine tasks, age diversity was unrelated to group performance while it related positively with the undesirable outcome of health disorders. Finally, Backes-Gellner and Veen (2013) could show in a representative annual panel survey comprising 18,000 German companies that employees’ age diversity has a positive effect on company performance, however, only if the respective firm engages in creative tasks rather than in routine tasks. Moreover Li and colleagues (2011) found in their sample of Chinese insurance companies that firm strategy (i.e., a strategy of geographical market diversification) moderated the age diversity-return on assets relationship. Only companies engaging in such a corporate strategy profited from increasing levels of age diversity.

4.3 Team Processes

With regard to team processes as a moderator, findings are comparably inconsistent. First, Ely (2004) investigated in a sample of 486 retail bank branches how the quality of team processes (cooperation and teamwork) might moderate the age diversity-team performance relationship. Contrary to her hypothesis, under conditions of high quality teamwork and cooperation, the age diversity-performance relationship was negative, while under conditions of low quality teamwork and cooperation, this relationship was either positive or insignificant. Given these findings, Ely (2004) speculated if high quality relationships between diverse coworkers might suppress the exchange of opposing ideas that are necessary for high levels of performance. Second, Choi and Rainey (2010) investigated team processes (cooperation and communication) as a moderator of the age diversity-performance link in a sample of 67 US Federal agencies and found no significant moderation effect. Similarly, Kim and colleagues (2013) tested social interaction among team members as a moderator of the age diversity-emotion regulation relationship and found no significant effect. Finally, Kearney, Gebert, and Voelpel (2009) inspected team need for cognition – defined as “the intrinsic motivation for and enjoyment of effortful cognitive activities” (p. 583) – as a moderator of the relationships between age diversity and the elaboration of task-relevant information, collective team identification, and performance. Age diversity was significantly and positively related to all three outcomes, but only under conditions of high team need for cognition.

4.4 Leadership Behavior

With regard to leader-member-exchange (LMX), Nishii and Mayer (2009) found in a sample of 348 supermarket departments that the positive relationship between demographic diversity (i.e., race, gender, age) and group turnover is attenuated under conditions of a high group mean of LMX (i.e., high overall LMX quality) as well as under conditions of low LMX differentiation within the group (i.e., similar LMX relationships within the group). Moreover, they also found a three-way interaction of demographic diversity, LMX mean, and LMX differentiation on turnover.

With regard to transformational leadership, Kearney and Gebert (2009) showed that age diversity is not related to team performance under conditions of high transformational leadership (TFL), while it was negatively related to team performance when transformational leadership was low. Similarly, Kunze and Bruch (2010) inspected the role of TFL as a moderator in the age-based faultlines-productive team energy relationship and found that age-based faultlines (i.e., faultlines created by an alignment of age with gender and organizational tenure) only related negatively to team energy under conditions of low TFL.

4.5 Age Stereotypes

Liebermann and colleagues (2013) explored the role of age stereotypes as a moderator of the age diversity-health relationship. They focused on negative age stereotypes about older employees (e.g., being less flexible or less engaged). They found that for younger employees, who hold such negative age stereotypes against older workers, the negative relationship between age diversity and health becomes stronger as they identify more with their own age group and less with the overall team. For older employees holding such stereotypes, the relationship becomes weaker as they identify less with their own age group and more with the overall team, reducing team-related stressors and fostering individual health. A second study in this field was conducted by Kunze, Boehm, and Bruch (2013) who found that negative age stereotypes against older workers held by a firm’s top management team aggravate the detrimental relationship of company age diversity with perceived age discrimination climate within firms.

4.6 HR and Diversity Management Practices

Choi and Rainey (2010) inspected the moderation effect of diversity management and found that under conditions of many EEO complaints (i.e., a lack of diversity management), age diversity was negatively related to organizational performance. Second, Ely (2004) investigated the role of participation in diversity education programs as a potential moderator, however, did not find any significant interaction with age diversity to predict branch performance. Similarly, Jehn and Bezrukova (2004) found no empirical support for their hypothesis that diversity-oriented HR practices would moderate the age diversity-group performance relationship in 1,528 units of a Fortune 500 firm. Finally, Kunze and colleagues (2013) showed at the organizational level of analysis that diversity-friendly HR practices can attenuate the age diversity-age discrimination climate relationship with positive, indirect implications for firm performance.

5 Taking the Next Step: Age-Diversity Climate in the Workplace

In the previous section, we have shed light on various moderators of the age-diversity-outcome relationship. Next, we want to analyze the role of age-diversity climate in some more detail, given its potentially important impact on how employees and managers make sense of and deal with age diversity in the workplace.

5.1 Diversity Mindsets and Climate for Diversity/Inclusion

At the individual level of analysis, some work has investigated the impact of attitudes towards and perceptions of workplace diversity (Hostager & De Meuse, 2002; Strauss & Connerley, 2003). Moreover, at the collective level of analysis, various scholars have assessed and described shared cognitions about diversity, expressed as diversity mindsets, climates, cultures, or perspectives (Chen & Eastman, 1997; Ely & Thomas, 2001; Van Knippenberg & Schippers, 2007). Dating back to the original work of Reichers and Schneider (1990, p. 22), organizational climates are assumed to evolve as part of a sensemaking process and are defined as “shared perceptions of the way things are around here.” Scholars including Kossek and Zonia (1993) and Mor Barak, Cherin, and Berkman (1998) have built upon this definition and specified it for the context of diversity. Consequently, diversity climate can be defined as “employees’ shared perceptions of the policies, practices, and procedures that implicitly and explicitly communicate the extent to which fostering and maintaining diversity and eliminating discrimination is a priority in the organization” (Gelfand, Nishii, Raver, & Schneider, 2005, p. 104). In addition, scholars have started to focus on climate for inclusion as an organizational environment in which employees profit from both a high belongingness to the group as well as a high appreciation for the uniqueness they bring to the group (i.e., specific knowledge or attitudes) (Nishii, 2013; Shore, Randel, Chung, Dean, Ehrhart, & Singh, 2011). What these various conceptualizations of diversity climates or mindsets have in common is that they suggest a (positive) impact on heterogeneous environments. In other words, in workplaces characterized by a positive climate for diversity, harmful, diversity-related processes such as in-group vs. out-group formation and discrimination should be reduced while beneficial processes such as communication and information exchange should be fostered. Various researchers have shown such effects for diversity categories such as race or gender and outcomes including performance, turnover, or customer satisfaction (Boehm et al., 2014; McKay, Avery, & Morris, 2009; Nishii, 2013).

While a general climate for diversity/inclusion has been found to contribute to organizational effectiveness, the most immediate impact in age-diverse environments could be expected from an even more specified form of diversity climate, i.e. a distinct age-diversity climate.

5.2 Age-Diversity Climate and Age Cultures

Building on this rationale, Boehm, Kunze, and Bruch (in press) conceptualized age-diversity climate as the collective perception that an organization favors an age-diverse workforce and takes active steps to recruit, promote, and retain employees of all age groups while any form of age-related discrimination (also among employees) is avoided. Consequently, a positive age-diversity climate reflects basically the opposite of what Kunze and colleagues (2011, 2013) framed as an “age-discrimination climate”, i.e. the perception of unfairness of age-related organizational behaviors, actions, and procedures towards different age groups. As Boehm and colleagues (in press) show in a sample of 93 German companies, a strong age-diversity climate relates positively to collective perceptions of social exchange, which in turn, relate positively to firm performance and negatively to employees’ collective turnover intentions. Moreover, Boehm et al. address the question of how to foster such an age-diversity climate and show that age-inclusive HR practices (including age-neutral recruiting activities, equal access to training for all age groups, and equal opportunities to be promoted irrespective of one’s age) are an important organizational-level predictor of age-diversity climate.

Another recent conceptualization of a distinct age-diversity mindset stems from Zacher and Gielnik (2014) who describe age cultures as collective perceptions of younger respectively older employees in the workplace as being efficient/motivated/flexible/reliable/high in initiative. They found that such age cultures can be predicted by the interaction of CEO age and CEO attitudes against older respectively younger workers.

In sum, research on age-diversity climate seems both scarce and promising. Given the large number of studies showing positive performance effects of a general diversity climate as well as the preliminary results on the effects of a distinct age-diversity climate, future research on this topic seems highly warranted.

6 Future Research Directions: Where Age-Diversity Research Might Go

Our review of potential effects of age diversity together with the investigation of various boundary conditions have indicated that future research is needed in order to better understand the often contradictory results related to age diversity in the workplace. In the following section, some exemplary directions for future research will be described.

First, back in 1999, Jehn and colleagues have already pointed to need to develop a clearer idea what demographic diversity (or in our case age diversity) really means: Is it informational diversity, value diversity, both, or neither? Most likely, it can be all of these and it again depends on the context. While age differences in a team of finance experts discussing a merger might not provide any informational advantages, there might be such advantages in a team of young and old marketing experts discussing features of a new product. Consequently, the effect of age diversity might be completely different – even if both teams experience a similar task interdependency and task complexity. Therefore, scholars are well advised to put even more energy into carefully analyzing if and how the organizational context might influence one’s findings.

On a related point, scholars might have used age imprecisely as a proxy for similar values, beliefs, or experiences within a certain age group (Lawrence, 1997). The reality might be more complex and employees of similar age might be more diverse than one might think. Therefore, another fruitful area of future research is the investigation of individual-level underlying constructs, such as personal beliefs, values or attitudes that potentially moderate the effect of age heterogeneity in teams (Mannix & Neale, 2005). Temporal aspects might be another important boundary condition as prior research has shown that diversity effects vary over time (e.g., Jehn & Mannix, 2001). For instance, age differences as an easy to detect surface-level characteristic might be more important in early life stages of a team compared to later points in time, when more deep-level characteristics (such as joint values) become relevant.

Third, as prior research has indicated (e.g., Guillaume et al., 2012; Liebermann et al., 2013), it might be interesting to study potential interaction effects between composite diversity (e.g., the age variance of a team) and relational diversity (e.g., the age difference between a given individual and the rest of his/her team). By doing so, much more fine-grained effects for individual-level outcomes may be derived.

Fourth, scholars might want to explore the specific effects of age diversity on the employment relationship. As described above, varies studies found negative relationships of age diversity with indicators of the employment relationship such as organizational commitment or intent to stay. Future research should shed more light on these diversity-triggered changes in the employment relationship including potential effects on psychological contracts or perceived organizational support (Eisenberger, Hungtington, Hutchison, & Sowa, 1986).

Fifth, research has recently started to investigate age diversity at the organizational level of analysis. A couple of further questions seem interesting in this regard. For instance, the specific role of age-diversity climate (Boehm et al., in press) or climate for inclusion (Nishii, 2013) as an enabler for positive age-diversity effects should be explored in more detail. Finally, age-inclusive HR practices (e.g., Armstrong-Stassen & Lee, 2009; Boehm et al., in press) seem to be a promising organizational-level intervention strategy in order to foster a positive age-diversity climate and related performance effects.

In sum, we hope that this chapter supports scholars in order to gain an overview of the topic of age diversity, a topic which is equally important for the modern workforce as well as more complex than it might originally seem.