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To recruit skilled workers or to train one's own? : vocational training in the face of uncertainty as to the rate of retention of trainees on completion of training

  • Bellmann, Lutz


    (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])

  • Janik, Florian


    (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])

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    "The article deals with the impact of uncertainty as regards the retention of trainees completing vocational training programmes on firms' training behaviour. As an alternative to vocational training, the external recruitment of skilled workers is considered via an opportunity costs approach. The uncertainty is traced back to staff turnover, considerable product market competition and changing skill requirements. Indicators of these causes of uncertainty are examined as to their impact on vocational training and the recruitment of skilled workers with a fractional logit model, using a seemingly unrelated cluster-adjusted sandwich estimator with data from the IAB Establishment Panel. There is no confirmation that the presumed correlations exist in manufacturing. A negative correlation is identified in the service sector between high staff turnover coupled with rapid change in the skills required on the one hand, and commitment to vocational training on the other, while there is a positive link with the external recruitment of skilled workers. This is interpreted as an indication that uncertainty with regard to retention after training can go some way towards explaining the growing gap between employment and vocational training in the tertiary sector." (Author's abstract, IAB-Doku) ((en)) Additional Information Kurzfassung (deutsch) Executive summary (English)

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    Article provided by Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] in its journal Zeitschrift für ArbeitsmarktForschung – Journal for Labour Market Research.

    Volume (Year): 40 (2007)
    Issue (Month): 2/3 ()
    Pages: 205-220

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    Handle: RePEc:iab:iabzaf:v:2007:i:2/3:p:205-220
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    1. Acemoglu, D. & Pischki, J.S., 1996. "Why Do Firms Train? Theory and Evidence," Working papers 96-7, Massachusetts Institute of Technology (MIT), Department of Economics.
    2. Acemoglu, D. & Pischke, J.S., 1997. "The Structure of Wages and Investment in General Training," Working papers 97-24, Massachusetts Institute of Technology (MIT), Department of Economics.
    3. Acemoglu, Daron & Pischke, Jorn-Steffen, 1999. "Beyond Becker: Training in Imperfect Labour Markets," Economic Journal, Royal Economic Society, vol. 109(453), pages F112-42, February.
    4. Bartel, Ann P & Lichtenberg, Frank R, 1987. "The Comparative Advantage of Educated Workers in Implementing New Technology," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 1-11, February.
    5. Breusch, T S & Pagan, A R, 1980. "The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 239-53, January.
    6. 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.
    7. Papke, Leslie E & Wooldridge, Jeffrey M, 1996. "Econometric Methods for Fractional Response Variables with an Application to 401(K) Plan Participation Rates," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 11(6), pages 619-32, Nov.-Dec..
    8. Stefan C. Wolter & Samuel Mühlemann & Jürg Schweri, 2006. "Why Some Firms Train Apprentices and Many Others Do Not," German Economic Review, Verein für Socialpolitik, vol. 7, pages 249-264, 08.
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