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Employee Training and Wage Dispersion: White and Blue Collar Workers in Britain

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Author Info

  • Almeida-Santos, Filipe

    ()
    (Universidade Catolica Portuguesa, Lisbon)

  • Chzhen, Yekaterina

    ()
    (University of Oxford)

  • Mumford, Karen A.

    ()
    (University of York)

Abstract

We use household panel data to explore the wage returns associated with training incidence and intensity (duration) for British employees. We find these returns differ depending on the nature of the training; who funds the training; the skill levels of the recipient (white or blue collar); the age of the employee; and if the training is with the current employer or not. Using decomposition analysis, training is found to be positively associated with wage dispersion: a virtuous circle of wage gains and training exists in Britain but only for white-collar employees.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4821.

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Length: 29 pages
Date of creation: Mar 2010
Date of revision:
Publication status: published in: Research In Labor Economics, 2010, 30, 35-60
Handle: RePEc:iza:izadps:dp4821

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Keywords: wage compression; performance; training;

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References

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  1. Melero Martín, Eduardo, 2004. "Evidence on Training and Career Paths: Human Capital, Information and Incentives," IZA Discussion Papers 1377, Institute for the Study of Labor (IZA).
  2. Tracy Regan & Ronald Oaxaca, 2009. "Work experience as a source of specification error in earnings models: implications for gender wage decompositions," Journal of Population Economics, Springer, vol. 22(2), pages 463-499, April.
  3. Ariga, Kenn & Brunello, Giorgio, 2002. "Are the More Educated Receiving More Training? Evidence from Thailand," IZA Discussion Papers 577, Institute for the Study of Labor (IZA).
  4. Polachek, Solomon W., 2008. "Earnings Over the Life Cycle: The Mincer Earnings Function and Its Applications," Foundations and Trends(R) in Microeconomics, now publishers, vol. 4(3), pages 165-272, April.
  5. Lynch, Lisa M, 1992. "Private-Sector Training and the Earnings of Young Workers," American Economic Review, American Economic Association, vol. 82(1), pages 299-312, March.
  6. Almeida-Santos, Filipe & Mumford, Karen A., 2004. "Employee Training and Wage Compression in Britain," IZA Discussion Papers 1197, Institute for the Study of Labor (IZA).
  7. Pischke, Jörn-Steffen, 2000. "Continuous Training in Germany," IZA Discussion Papers 137, Institute for the Study of Labor (IZA).
  8. Karen Mumford & Peter N Smith, . "Job Tenure in Britain: Employee Characteristics Versus Workplace Effects," Discussion Papers 04/06, Department of Economics, University of York.
  9. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352.
  10. Cotton, Jeremiah, 1988. "On the Decomposition of Wage Differentials," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 236-43, May.
  11. Arulampalam, Wiji & Booth, Alison L. & Bryan, Mark L., 2004. "Are There Asymmetries in the Effects of Training on the Conditional Male Wage Distribution?," IZA Discussion Papers 984, Institute for the Study of Labor (IZA).
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  16. Loewenstein, Mark A & Spletzer, James R, 1998. "Dividing the Costs and Returns to General Training," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 142-71, January.
  17. Harley Frazis & Mark A. Loewenstein, 2005. "Reexamining the Returns to Training: Functional Form, Magnitude, and Interpretation," Journal of Human Resources, University of Wisconsin Press, vol. 40(2).
  18. Jacob Mincer, 1958. "Investment in Human Capital and Personal Income Distribution," Journal of Political Economy, University of Chicago Press, vol. 66, pages 281.
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Citations

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Cited by:
  1. Matteo PICCHIO & Jan C. van OURS, 2011. "Retaining through Training: Even for Older Workers," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2011017, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  2. Carla Haelermans & Lex Borghans, 2012. "Wage Effects of On-the-Job Training: A Meta-Analysis," British Journal of Industrial Relations, London School of Economics, vol. 50(3), pages 502-528, 09.
  3. Haelermans Carla & Borghans Lex, 2011. "Wage effects of on-the-job training. A meta-analysis," ROA Research Memorandum 011, Maastricht University, Research Centre for Education and the Labour Market (ROA).
  4. Haelermans Carla & Borghans Lex, 2011. "Wage effects of on-the-job training; a meta-analysis," Research Memorandum 054, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).

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