Abstract:
This paper analyses the effect of training participation on
employees’ retention in the training establishment. On the
basis of the human capital and monopsony theories the
effect of portability, visibility, and credibility of training on
employee retention is jointly calculated. We use an exten sive German linked employer–employee panel data set
with detailed survey information on the training history
and administrative labour market information of 4318
employees working in 149 establishments (WeLL-ADIAB). In
multivariate panel regressions including internal instru ments we compare the probability of staying with the
same employer between training participants and employ ees who were by chance unable to participate in a planned
training event. The high portability of training contents and
training visibility provided by training certificates reduce
the retention effect of training independently. Retention is
reduced further when training content is reported credibly,
that is, it is provided and certified by external institutions.
However, the total effect of portable, visible, and credible
training on retention is still positive. This paper therefore
implies that employers can reap a double dividend of
higher productivity and increased retention even from gen eral, visible, and credible trainin
