Early Career Mobility and Earnings Profiles of German Apprentices: Theory and Empirical Evidence

31 Pages Posted: 6 Jul 2004

See all articles by Spiros Bougheas

Spiros Bougheas

University of Nottingham - School of Economics

Yannis Georgellis

University of Kent

Abstract

We investigate how apprenticeship training affects the early career mobility and earnings profiles of young apprentices in Germany. The heterogeneous quality and nature (whether general or firm specific) of training across firms is expected to be reflected in the post-apprenticeship mobility and earning patterns of young workers. In this paper, we argue that a simple model of training and labour turnover can explain such patterns. Specifically, assuming that job changes are associated with a loss of accumulated firm-specific skills, the model predicts that although movers initially experience a productivity loss, their earnings grow at a faster rate than those of stayers. As job changes become more costly the longer a worker stays with the training firm, later movers experience a larger reduction in their earnings compared with direct movers. Estimated selectivity-corrected earnings equations for movers and stayers, based on data from the German Socioeconomic Panel (GSOEP), support the predictions of the model and highlight important differences in earnings profiles and mobility patterns by apprenticeship firm size.

Suggested Citation

Bougheas, Spiros and Georgellis, Yannis, Early Career Mobility and Earnings Profiles of German Apprentices: Theory and Empirical Evidence. Labour: Review of Labour Economics and Industrial Relations, Vol. 18, No. 2, pp. 233-263, June 2004. Available at SSRN: https://ssrn.com/abstract=549792

Spiros Bougheas (Contact Author)

University of Nottingham - School of Economics ( email )

University Park
Nottingham, NG7 2RD
United Kingdom

Yannis Georgellis

University of Kent ( email )

Canterbury, Kent CT2 7PE
United Kingdom

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