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Employee Training And Wage Compression In Britain

  • FILIPE ALMEIDA-SANTOS
  • KAREN MUMFORD

We use linked data for 1460 workplaces and 19,853 employees from the Workplace Employee Relations Survey 1998 to analyse the incidence and duration of employee training in Britain. We find training to be positively associated with having a recognized vocational qualification and current union membership. However, being non-white, having shorter current-job tenure and part-time or fixed-term employment statuses are all associated with less training. Furthermore, in line with recent non-competitive training models, higher levels of wage compression (measured in absolute or relative terms) are positively related to training. Copyright Blackwell Publishing Ltd and The Victoria University of Manchester, 2005..

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Article provided by University of Manchester in its journal The Manchester School.

Volume (Year): 73 (2005)
Issue (Month): 3 (06)
Pages: 321-342

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Handle: RePEc:bla:manchs:v:73:y:2005:i:3:p:321-342
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  1. Mumford, Karen & Dowrick, Steve, 1994. "Wage Bargaining with Endogenous Profits, Overtime Working and Heterogeneous Labor," The Review of Economics and Statistics, MIT Press, vol. 76(2), pages 329-36, May.
  2. Alison L. Booth & Gylfi Zoega, 2004. "Is wage compression a necessary condition for firm-financed general training?," Oxford Economic Papers, Oxford University Press, vol. 56(1), pages 88-97, January.
  3. Edwin Leuven, 2005. "The Economics of Private Sector Training: A Survey of the Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 19(1), pages 91-111, 02.
  4. Booth, Alison L. & Bryan, Mark L., 2002. "Who Pays for General Training? New Evidence for British Men and Women," IZA Discussion Papers 486, Institute for the Study of Labor (IZA).
  5. William Collier & Francis Green & John Peirson & David Wilkinson, 2002. "Training and Establishment Survival," Studies in Economics 0208, School of Economics, University of Kent.
  6. John M. Abowd & Francis Kramarz & David N. Margolis, 1994. "High-Wage Workers and High-Wage Firms," CIRANO Working Papers 94s-23, CIRANO.
  7. Steven McIntosh, 1999. "A cross-country comparison of the determinants of vocational training," LSE Research Online Documents on Economics 20213, London School of Economics and Political Science, LSE Library.
  8. Daron Acemoglu & Jorn-Steffen Pischke, 1996. "Why Do Firms Train? Theory and Evidence," NBER Working Papers 5605, National Bureau of Economic Research, Inc.
  9. Pischke, J-S, 1996. "Continuous Training in Germany," Working papers 96-28, Massachusetts Institute of Technology (MIT), Department of Economics.
  10. Chang, Chun & Wang, Yijiang, 1996. "Human Capital Investment under Asymmetric Information: The Pigovian Conjecture Revisited," Journal of Labor Economics, University of Chicago Press, vol. 14(3), pages 505-19, July.
  11. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9.
  12. Giorgio Brunello, 2002. "Is Training more Frequent when Wage Compression is Higher? Evidence from 11 European Countries," CESifo Working Paper Series 637, CESifo Group Munich.
  13. Daron Acemoglu, 2000. "Technical Change, Inequality, and the Labor Market," NBER Working Papers 7800, National Bureau of Economic Research, Inc.
  14. Stevens, Margaret, 1994. "A Theoretical Model of On-the-Job Training with Imperfect Competition," Oxford Economic Papers, Oxford University Press, vol. 46(4), pages 537-62, October.
  15. Shields, Michael A & Price, Stephen Wheatley, 1999. "Ethnic Differences in the Incidence and Determinants of Employer-Funded Training in Britain," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(5), pages 523-51, November.
  16. Karen Mumford & Peter N. Smith, 2004. "Job Tenure in Britain: Employee Characteristics versus Workplace Effects," Economica, London School of Economics and Political Science, vol. 71(281), pages 275-297, 05.
  17. Randall K. Filer, 1986. "The role of personality and tastes in determining occupational structure," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 39(3), pages 412-424, April.
  18. Caballero, Ricardo J & Hammour, Mohamad L, 1994. "The Cleansing Effect of Recessions," American Economic Review, American Economic Association, vol. 84(5), pages 1350-68, December.
  19. Polachek,Solomon W. & Siebert,W. Stanley, 1993. "The Economics of Earnings," Cambridge Books, Cambridge University Press, number 9780521367288.
  20. Katz, Eliakim & Ziderman, Adrian, 1990. "Investment in General Training: The Role of Information and Labour Mobility," Economic Journal, Royal Economic Society, vol. 100(403), pages 1147-58, December.
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  22. Harley Frazis & Maury Gittleman & Mary Joyce, 2000. "Correlates of Training: An Analysis Using Both Employer and Employee Characteristics," ILR Review, Cornell University, ILR School, vol. 53(3), pages 443-462, April.
  23. Bassanini, Andrea & Brunello, Giorgio, 2003. "Is Training More Frequent When Wage Compression is Higher? Evidence from the European Community Household Panel," IZA Discussion Papers 839, Institute for the Study of Labor (IZA).
  24. 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).
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