Training and Hiring Strategies to Improve Firm Performance

We study how upgrading the skills of the personnel affects a firm’s performance. Two different strategies are examined : 1) providing formal training and 2) strategic recruitment and separation policy. The use of register-based longitudinal employer-employee data supplemented with a survey on vocational training provides an opportunity to shed fresh light on the issue and allows us to address the usual econometric problems. We find that internally (but not externally) organized training stimulates subsequent growth of performance but only when combined with the implementation of new process or product technology. Hiring highly skilled workers is initially costly to firms but is productivity-enhancing in the long run.

Publication info

Series
Discussion Papers no. 1105
Date
2007
Avainsanat
tuottavuus, kannattavuus, henkilöstökoulutus, muodollinen koulutus, rekrytointi
Keywords
productivity, profitability, training, education, hiring
JEL
J24,M5,O3,D2
Pages
45
Price
10 €
Availability of print version
Language
English