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Hiring Costs for Skilled Workers and the Supply of Firm-Provided Training

Listed author(s):
  • Marc Blatter

    (Department of Economics, University of Bern)

  • Samuel Mühlemann

    ()

    (University of Munich & IZA Bonn)

  • Samuel Schenker

    (State Secretariat for International Financial Matters, Switzerland)

  • Stefan C. Wolter

    (Department of Economics, University of Bern & IZA Bonn & CESifo Munich)

This paper analyzes how the costs of hiring skilled workers from the external labor market affect a firm's supply of training. Using administrative survey data with detailed information on hiring and training costs for Swiss firms, we find evidence for substantial and increasing marginal hiring costs. However, firms can invest in internal training of unskilled workers and thereby avoid costs for external hiring. Controlling for a firm's training investment, we find that a one standard deviation increase in external hiring costs increases the number of internal training positions by 0.7 standard deviations.

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File URL: http://repec.business.uzh.ch/RePEc/iso/leadinghouse/0109_lhwpaper.pdf
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Paper provided by University of Zurich, Department of Business Administration (IBW) in its series Economics of Education Working Paper Series with number 0109.

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Length: 28 pages
Date of creation: Feb 2012
Handle: RePEc:iso:educat:0109
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Web page: http://www.business.uzh.ch
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