The Impact of Training on Productivity and Wages: Firm-Level Evidence

Konings, Jozef; Vanormelingen, Stijn

doi:10.1162/rest_a_00460

Cited by 153 publications

(57 citation statements)

References 29 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…4 We also looked at literature that tries to factor in the cost of training (direct costs, forgone earnings and opportunity costs) to determine returns. Carefully designed literature that treats for selection issues suggests that OJT is linked with wage and productivity gains, but with firms benefiting more than workers (Almeida and de Faria 2014;Dearden, Reed, and Van Reenen 2006;and Konings and Vanormelingen 2015). (See Section 2.1 for a detailed review.…”

Section: Summary Of Results By Key Questionsmentioning

confidence: 99%

“…However, we cannot do this practically without running into serious methodological challenges. Directionally, however, there is evidence of rather modest returns to ALMPs (Betcherman, Dar and Olivas 2004), whereas the returns to OJT have been found to be higher (Konings and Vanormelingen 2015). However, the challenge is that we are not able to attribute causality to program design properly as these programs target different groups of trainees.…”

Section: At Current Employer: Effect On Productivity Wages and Costsmentioning

confidence: 98%

“…Studies find positive effects of OJT on direct measures of firm productivity and wages. For example, Konings and Vanormelingen (2015) use firm-level panel data of OJT to estimate its impact on productivity and wages in Belgium (figure 1). Treating for endogeneity of input factors and training, they find that the increase in productivity of the trained worker is higher than the increase in wages the trained worker commands because the worker participated in OJT.…”

Section: Upside To Ojt: Productivity and Wage Effectsmentioning

confidence: 99%

“…Source: Konings and Vanormelingen, 2015. Note: In the United Kingdom, a 1 percent increase in workrelated training is associated with an increase in value-added per hour of about 0.6 percent for the firm, as well as an increase in hourly wages of about 0.3 percent for the worker.…”

Section: Box 4: What Type Of Workers Receive Training?mentioning

confidence: 99%

See 3 more Smart Citations

On-the-Job Training: Returns, Barriers to Provision, and Policy Implications

Saraf¹

2017

Policy Research Working Papers

View full text Add to dashboard Cite

Firms that provide on-the-job training do so when it is critical to their productivity-and when productivity is critical to their survival. This paper begins by confirming a significant and positive return from on-the-job training on wages and productivity, as well as the presence of positive externalities from on-the-job training, while discussing the methodological considerations at play. The paper then reviews and validates the presence of market failures such as information asymmetries within the firm as a result of low-quality management practices that dampen firm demand for on-the-job training. Lack of competition in the firm's external environment appears to undermine adoption of on-the-job training and other complementary productivity-enhancing activities within the firm. The literature suggests that for most firms, a comprehensive policy approach that resolves external constraints to becoming more productive is likely to have a positive impact on the provision of on-the-job training and adoption of complementary policies. More direct forms of firm-level support to improve management capabilities could also alleviate under-provision of on-the-job training. Where societies have improved welfare as a goal, public policy measures would be needed to complement on-the-job training for some specific groups of workers (older, less educated, women). In essence, the paper highlights the importance of demand-side constraints for firms, rather than supply-side constraints, for the provision of on-the-job training.

show abstract

Section: Summary Of Results By Key Questionsmentioning

confidence: 99%

Section: At Current Employer: Effect On Productivity Wages and Costsmentioning

confidence: 98%

Section: Upside To Ojt: Productivity and Wage Effectsmentioning

confidence: 99%

Section: Box 4: What Type Of Workers Receive Training?mentioning

confidence: 99%

See 2 more Smart Citations

On-the-Job Training: Returns, Barriers to Provision, and Policy Implications

Saraf¹

2017

Policy Research Working Papers

View full text Add to dashboard Cite

show abstract

“…In samples of workers of all ages, studies have found that on-the-job training is linked to higher employee productivity (Barrett & O'Connell 2001;Bartel 1995;Conti 2005;Konings & Vanormelingen 2009;Zwick 2006), slower depreciation of human capital (Groot & Maassen van den Brink 2000;Neuman & Weiss 1995), future employability (Crépon, Ferracci, & Fougére 2007;Lechner, Miquel, & Wunsch 2005) and wage growth (Bartel 1995;Dearden, Reed, & Van Reenen 2006;Groot 1999). However older employees have fewer remaining years of work to reap the returns on their training investment (Ben-Porath 1967).…”

Section: A Possible Mechanism: Training and Wagesmentioning

confidence: 99%

The Relationship between Establishment Training and the Retention of Older Workers: Evidence from Germany

Berg

Hamman

Piszczek

et al. 2015

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes.You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public. licence. www.econstor.eu Any opinions expressed here are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but the institute itself takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated D I S C U S S I O N P A P E R S E R I E SThe Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public.IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author.IZA Discussion Paper No. 9508 November 2015 ABSTRACT The Relationship Between Establishment Training and the Retention of Older Workers: Evidence from GermanyIn the coming years, a substantial portion of Germany's workforce will retire, making it difficult for businesses to meet human capital needs. Training older workers may be a successful strategy for managing this demographic transition. This study examines relationships between establishment training programs, wages, and retirement among older men and women. Using unique matched establishment-employee data from Germany, the authors find that when establishments offer special training programs targeted at older workers, womenand especially l...

show abstract

Measuring Performance in Vocational Education and Training and the Employer's Decision to Invest in Workplace Training

Muehlemann

2019

The Wiley Handbook of Vocational Education and Training

View full text Add to dashboard Cite

The Impact of Training on Productivity and Wages: Firm-Level Evidence

Cited by 153 publications

References 29 publications

On-the-Job Training: Returns, Barriers to Provision, and Policy Implications

On-the-Job Training: Returns, Barriers to Provision, and Policy Implications

The Relationship between Establishment Training and the Retention of Older Workers: Evidence from Germany

Measuring Performance in Vocational Education and Training and the Employer's Decision to Invest in Workplace Training

Contact Info

Product

Resources

About