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Works councils, collective bargaining and apprenticeship training

Author

Listed:
  • Ben Kriechel

    (Maastricht University and IZA Bonn)

  • Samuel Muehlemann

    (University of Bern and IZA Bonn)

  • Harald Pfeifer

    () (Federal Institute for Vocational Education and Training (BIBB) Bonn)

  • Miriam Schuette

    (Federal Institute for Vocational Education and Training (BIBB) Bonn)

Abstract

We investigate the effects of works councils on apprenticeship training. The German law attributes works councils substantial information and co-determination rights on training-related issues. Thus, works councils may also have an impact on the cost-benefit relation of workplace training. Using detailed firm-level data containing information on the costs and benefits of apprenticeship training in Germany, we apply econometric matching methods to identify works council effects. We find that firms with works councils make a significantly higher net investment in apprenticeship training compared to firms without such an institution. However, we also find that the fraction of workers still employed with the same firm five years after training is significantly higher in the presence of works councils, enabling firms to recoup training investments over a longer time horizon. All works council effects, however, are much more pronounced for firms covered by collective bargaining agreements.

Suggested Citation

  • Ben Kriechel & Samuel Muehlemann & Harald Pfeifer & Miriam Schuette, 2011. "Works councils, collective bargaining and apprenticeship training," Economics of Education Working Paper Series 0057, University of Zurich, Department of Business Administration (IBW).
  • Handle: RePEc:iso:educat:0057
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    References listed on IDEAS

    as
    1. Addison, John T. & Teixeira, Paulino & Zwick, Thomas, 2006. "Works Councils and the Anatomy of Wages," IZA Discussion Papers 2474, Institute for the Study of Labor (IZA).
    2. John T. Addison & Claus Schnabel & Joachim Wagner, 2004. "The Course of Research into the Economic Consequences of German Works Councils," British Journal of Industrial Relations, London School of Economics, vol. 42(2), pages 255-281, June.
    3. Wolter, Stefan C. & Ryan, Paul, 2011. "Apprenticeship," Handbook of the Economics of Education, Elsevier.
    4. Uschi Backes-Gellner & Simone N. Tuor, 2010. "Avoiding Labor Shortages by Employer Signaling: On the Importance of Good Work Climate and Labor Relations," ILR Review, Cornell University, ILR School, vol. 63(2), pages 271-286, January.
    5. Bernd Fitzenberger & Karsten Kohn & Qingwei Wang, 2011. "The erosion of union membership in Germany: determinants, densities, decompositions," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 141-165, January.
    6. Muehlemann, Samuel & Pfeifer, Harald & Walden, Günter & Wenzelmann, Felix & Wolter, Stefan C., 2010. "The financing of apprenticeship training in the light of labor market regulations," Labour Economics, Elsevier, vol. 17(5), pages 799-809, October.
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    19. repec:rim:rimwps:13-07 is not listed on IDEAS
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    Cited by:

    1. Mohrenweiser, Jens, 2016. "Recruitment and apprenticeship training," Industrielle Beziehungen - Zeitschrift fuer Arbeit, Organisation und Management - The German Journal of Industrial Relations, Rainer Hampp Verlag, vol. 23(1), pages 6-24.
    2. Uwe JIRJAHN & Stephen C. SMITH, 2018. "Nonunion Employee Representation: Theory And The German Experience With Mandated Works Councils," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 89(1), pages 201-233, March.
    3. Zwick Thomas & Mohrenweiser Jens, 2015. "Youth Unemployment After Apprenticeship Training and Individual, Occupation, and Training Employer Characteristics," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 235(4-5), pages 418-432, August.
    4. Samuel Muehlemann & Harald Pfeifer & Felix Wenzelmann, 2013. "The Costs of Recruiting Apprentices: Evidence from German Firm-Level Data," Economics of Education Working Paper Series 0095, University of Zurich, Department of Business Administration (IBW), revised Nov 2015.
    5. Robert Wagner & Thomas Zwick, 2012. "How Acid are Lemons? Adverse Selection and Signalling for Skilled Labour Market Entrants," Economics of Education Working Paper Series 0071, University of Zurich, Department of Business Administration (IBW), revised Feb 2012.
    6. Uwe Cantner & Wolfgang Gerstlberger & Ipsita Roy, 2014. "Works Councils, Training Activities and Innovation: A Study of German Firms," Jena Economic Research Papers 2014-006, Friedrich-Schiller-University Jena.
    7. Jansen A., 2016. "Is investing in apprentices related to decision-makers’ altruism and their high time preference?," Research Memorandum 010, Maastricht University, Graduate School of Business and Economics (GSBE).
    8. Samuel Muehlemann & Stefan Wolter, 2014. "Return on investment of apprenticeship systems for enterprises: Evidence from cost-benefit analyses," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-22, December.
    9. Jansen, A., 2016. "Is investing in apprentices related to decision-makers' altruism and their high time preference?," ROA Research Memorandum 002, Maastricht University, Research Centre for Education and the Labour Market (ROA).

    More about this item

    Keywords

    Works councils; collective bargaining agreement; apprenticeship training; firm-sponsored training;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training

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