Measuring the impact of on the job training on job mobility

Carrasco, Raquel and Alvarez, Gema (2013): Measuring the impact of on the job training on job mobility. Published in: Revista de Economía Aplicada , Vol. XXIV, No. Número 70 (2016): pp. 5-25.

Abstract

This paper studies the effect of employer-provided training on the probability of subsequent job exit. Empirical evidence usually shows that the probability of receiving training by the employer is higher among those employees with the lowest expected rates of turnover. Therefore, it seems that firms provide training selectively. In this paper, we address the empirical question of to what extent this endogeneity problem leads to a spurious correlation between training receipt and job mobility. Using Spanish Data from the European Community Household Panel, we provide estimates that ignore the selection bias and compare the results with the ones obtained when correcting for the possible nonrandom selection between trainees and non-trainees. Overall, our results show that there is a negative correlation between on the job training and job mobility, but only for fired workers, and not for voluntary movers. Nonetheless, once the endogeneity problem is accounted, the negative effect becomes statistically nonsignificant for all types of movers

• Item Type: MPRA Paper
• Language: English
• Keywords: on the job training, turnover, job mobility
• Subjects: M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M1 - Business Administration > M15 - IT Management

References

Acemoglu, D. and Pischke, J. (1998): “Why do firms train? Theory and evidence”, Quarterly Journal of Economics, vol. 113, pp. 79-119. Altonji, J. and Shakotko, R. (1987): “Do wages rise with job seniority?”, Review of Economic Studies, vol. 54, pp. 437-459. Arulampalam, W., Booth, A. and Bryan, M. (2010): “Are there asymmetries in the effects of training on the Conditional Male Wage Distribution?”, Journal of Population Economics, vol. 23, pp. 251-272. Bartel, A. (1995): “Training, wage growth and job performance: evidence from a company database”, Journal of Labor Economics, vol. 13, pp. 401-425. Becker, G. (1964): Human capital: a theoretical and empirical analysis with special reference to education, Columbia University Press for National Bureau of Economic Research. New York. Bishop, J. (1997): “What we know about employer-provided training: a review of the literature”, Research in Labor Economics, vol. 16, pp. 19-87. Card, D. and Sullivan, D. (1988): “Measuring the effect of subsidized training programs on movements in and out of employment”, Econometrica, vol. 56, pp. 497-530. Carrasco, R. (2001): “Binary choice with binary endogenous regressors in panel data: estimating the effect of fertility on female labour participation”, Journal of Business and Economics Statistics, vol. 19, pp. 385-394. De Grip, A., Heijke, H. and Willems, E. (1998): “Training and mobility”, The Netherlands’ Journal of Social Sciences, vol. 34, pp. 78-98. Dearden, L., Machin, S., Reed, H. and Wilkinson, D. (1996): Labour turnover and work-related training, Report to the Department for Education and Employment. London. Elias, P. (1994): “Job-related training, training union membership and labour mobility: a longitudinal study”, Oxford Economic Papers, vol. 46, pp. 563-578 Green, F., Felstead, A., Mayhew, K. and Pack, A. (2000): “The impact of training on labour mobility: individual and firm-level evidence from Britain”, British Journal of Industrial Relations, vol. 38, pp. 261-275. Greenhalgh, C. and Stewart, M. (1987): “The effects and determinants of training”, Oxford Bulletin of Economics and Statistics, vol. 49, pp. 171-190. Groot, W. and Maassen van den Brink, H. (2000): “Education, training and employability”, Applied Economics, vol. 32, pp. 573-581. Korpi, T. and Mertens, A. (2003): “Training systems and labor mobility: A comparison between Germany and Sweden”, Scandinavian Journal of Economics, vol. 105, pp. 597-617. Katz, E. and Ziderman, A. (1990): “Investment in general training: the role of information and labour mobility”, Economic Journal, vol. 100, pp. 1147-1158. Lynch, L. (1991): “The role of off-the-job vs. on-the-job training for the mobility of individual workers”, American Economic Review, vol. 81, pp. 151-156. Loewenstein, M. and Spletzer, J. (1999): “General and specific training. Evidence and implications”, The Journal of Human Resources, vol. 34, pp. 710-733. Manski, C. (1990): “Nonparametric Bounds on Treatment Effects”, American Economic Review Papers and Proceedings, vol. 80, pp. 319-323. Manski, C., Sandefur, G., McLanahan, S. and Powers, D. (1992): “Alternative estimates of the effect of family structure during adolescence on high school graduation”, Journal of the American Statistical Association, vol. 87, pp. 25-37. Mincer, J. and Jovanovic, B. (1981): Labour mobility and wages, Studies in Labour Markets. University of Chicago Press, Chicago. Parent, D. (1999): “Wages and mobility: The impact of employer-provided training”, Journal of Labor Economics, vol. 17, pp. 298-317. Parent, D. (2003): “Employer-supported training in Canada and its impact on mobility and wages”, Empirical Economics, vol. 28, pp. 431-459. Sieben, I. (2007): “Does training trigger turnover or not? The impact of formal training on young men’s and women’s job search behavior”, Work, Employment & Society, vol. 21, pp. 397-416. Sieben, I. and de Grip, A. (2004): “Training and expectations on job mobility in the call centres sector”, Journal of European Industrial Training, vol. 28, pp. 257-271. Stevens, M. (1994): “A theoretical model of on-the-job training with imperfect competition”, Oxford Economic Papers, vol. 46, pp. 537-562. Veum, J. (1997): “Training and job mobility among young workers in the United States”, Journal of Population Economics, vol. 10, pp. 219-233. Zweimüller, J. and Winter-Ebmer, R. (2003): “On-the-job Training, Job Search, and Job Mobility”, Swiss Journal of Economics and Statistics, vol 139, pp. 563-576.