Why Do Firms Train? Empirical Evidence on the First Labour Market Outcomes of Graduated Apprentices

Rob Euwals () and Rainer Winkelmann
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Rob Euwals: CPB Netherlands Bureau for Economic Policy Analysis

No 319, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The apprenticeship system is the most important source of formal post-secondary training in Germany. Our paper contributes to the ongoing debate as to why firms are willing to invest in such training even though many apprentices will leave the training firm soon after completion of the apprenticeship. Using German register data - the IAB Employment Sample - we find that apprentices staying with their training firm after graduation have (1) higher wages and (2) longer first-job durations than apprentices leaving the training firm. These results support theories according to which firms use the apprenticeship system to select and retain the more able apprentices, thereby recouping the costs of investing in skills that are portable in principle.

Keywords: wages; job-duration; Training (search for similar items in EconPapers)
JEL-codes: C24 C41 J24 J31 J44 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2001-06
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (14)

Published - published as 'Training intensity and first labor market outcomes of apprenticeship graduates' in: International Journal of Manpower, 2004, 25 (5), 447-462

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Working Paper: Why do Firms Train? Empirical Evidence on the First Labour Market Outcomes of Graduate Apprentices (2001)
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