Why Some Firms Train Apprentices and Many Others Do Not

24 Pages Posted: 25 Nov 2003

See all articles by Stefan C. Wolter

Stefan C. Wolter

Swiss Coordination Centre for Research in Education (SKBF); University of Bern - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Samuel Muehlemann

University of Bern

Juerg Schweri

Swiss Federal Institute of Vocational Education and Research

Date Written: October 2003

Abstract

The latest study investigating the cost-benefit ratio of apprenticeship training for Swiss companies has shown that most apprentices offset the cost of their training during their apprenticeship on the basis of the productive contribution of the work they perform. Given this outcome, it is worth investigating why so many firms choose not to train apprentices. Maximum likelihood selection models were used to estimate the net cost of training for firms without an apprenticeship programme. The models show, firstly, that non-training firms would incur significantly higher net cost during the apprenticeship period if they would switch to a training policy and secondly, that this less favourable cost-benefit ratio is determined less by cost than by absence of benefit. For the apprenticeship system as such the results indicate, that as long as training regulations and the market situation permit a cost effective training of apprentices, companies do not need specific labour market regulations or institutions to offer training posts. In this respect, the Swiss findings might be of interest for the on-going German discussion about the expected repercussions of a more general labour market deregulation on the apprenticeship training system.

Keywords: apprenticeship training, firm-sponsored training, cost-benefit analysis

JEL Classification: J24, J31, J44

Suggested Citation

Wolter, Stefan C. and Mühlemann, Samuel and Schweri, Jürg, Why Some Firms Train Apprentices and Many Others Do Not (October 2003). IZA Discussion Paper No. 916. Available at SSRN: https://ssrn.com/abstract=464684

Stefan C. Wolter (Contact Author)

Swiss Coordination Centre for Research in Education (SKBF) ( email )

CH - 5000 Aarau
Switzerland
+41 62 835 23 90 (Phone)
+41 62 835 23 99 (Fax)

HOME PAGE: http://www.skbf-csre.ch

University of Bern - Department of Economics ( email )

Gesellschaftstrasse 49
Bern, CH-3012
Switzerland
+41 31 631 40 95 (Phone)
+41 31 631 39 92 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Samuel Mühlemann

University of Bern ( email )

Gesellschaftstrasse 49
Bern, CH-3012
Switzerland

Jürg Schweri

Swiss Federal Institute of Vocational Education and Research ( email )

Kirchlindachstrasse 79
Zollikofen, 3052
Switzerland

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