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Productivity and Wages: Measuring the Effect of Human Capital and Technology Use from Linked Employer-Employee Data

Listed author(s):
  • Julie Turcotte
  • Lori Whewell Rennison
Registered author(s):

    The use of information and communication technologies and investment in education and training are widely believed to play an important role in productivity growth at the aggregate level. However, a lack of micro-level data with information on firms and their workforce has limited the extent to which technology use and human capital could be linked to productivity at the firm level. This paper attempts to fill this research gap, using a new Canadian survey of both establishments and their workers -- the 1999 Workplace and Employer Survey. We examine the relationship between education, training, and technology use and firm productivity and wages, controlling for various firm and worker characteristics (including industry, foreign ownership, trade orientation, employee turnover, experience, occupation, etc.). We find strong evidence that computer use, university education and computer skills development are associated with higher productivity and higher wages. Moreover, the productivity benefit associated with computer use is enhanced when more workers receive computer training, regardless of whether or not they have a university degree. L’utilisation des technologies de l’information et l’investissement en éducation et formation sont largement reconnus comme des éléments clés de la croissance de la productivité au niveau agrégé. Toutefois, le manque de base de données contenant de l’information tant sur les emplacements que sur les employés a limité l’ampleur avec laquelle l’utilisation de technologies et le capital humain ont pu être liés à la productivité au niveau de l’entreprise. Ce papier tente de combler cette lacune en utilisant une nouvelle enquête canadienne reliant les établissements et leurs employés – l’Enquête de 1999 sur le Milieu de Travail et les Employés. Nous examinons les liens existants entre l’éducation, la formation et l’utilisation de technologie sur la productivité et les salaires, tout en contrôlant pour plusieurs caractéristiques de l’entreprise et des travailleurs (incluant le secteur industriel, la présence d’intérêts étrangers, l’ouverture au commerce, le roulement des travailleurs, l’expérience, la répartition professionnelle, etc.). Nous obtenons une forte évidence selon laquelle l’utilisation d’ordinateurs, la scolarité de niveau universitaire et le développement de compétences liées à l’utilisation d’ordinateurs sont associés à une plus grande productivité et de meilleurs salaires. Nous montrons également que les gains de productivité liés à l’utilisation d’ordinateurs s’en trouvent accrus lorsque les travailleurs bénéficient de formation, et ce peu importe le niveau de scolarité des travailleurs.

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    Paper provided by Department of Finance Canada in its series Working Papers-Department of Finance Canada with number 2004-01.

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    Date of creation:
    Handle: RePEc:fca:wpfnca:2004-01
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