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Journal of Business Economics

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01-02-2013 | Original Paper

Determinants and effects of intra-firm trainings: evidence from a large German company

Authors: Kathrin Breuer, Patrick Kampkötter

Published in: Journal of Business Economics | Issue 2/2013

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Abstract:

Using personnel records from a multinational company, we investigate determinants and effects of intra-firm training participation. The main question we address is who gets trained in the firm and whether company training sustainably increases the performance of employees. Besides analyzing the effects on wages, we are also able to use individual bonus payments as a productivity measure. We further observe the internal labor market of this company and are therefore able to analyze who receives intra-firm training. With this paper we contribute to the training literature with an insider econometric approach in order to gain further insights on the determinants and effects of intra-firm trainings.

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Journal of Business Economics

From January 2013, the Zeitschrift für Betriebswirtschaft (ZfB) is published in English under the title Journal of Business Economics (JBE). The Journal of Business Economics (JBE) aims at encouraging theoretical and applied research in the field of business economics and business administration, promoting the exchange of ideas between science and practice.

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Furthermore, in large companies, training provision is formalized to a large extent, as more than 70 % of these companies have a specific person/unit responsible for training, pursue training plans, prepare a training budget and measure participant satisfaction.

For a prominent approach to evaluate trainings see Kirkpatrick (1979).

The company employs more than 100,000 employees worldwide. Due to confidentiality reasons, we are not allowed to give any detailed information about the firm. We only present some descriptive statistics on the organizational and workforce structure of the firm in the following.

Members of the management board are not part of the sample. Note that only exempt employees are eligible for bonus payments.

Regressions indeed confirm that movers earn significantly lower bonus payments in the year of the job change than stayers.

Note that Bartel (1995) follows a similar approach.

Note that some employees participate in more than one training each year. Therefore, the total participation rate for each employee group in Fig. 2 may be higher than the average training participation rate in at least one training in Fig. 1.

The results are available upon request.

See e.g., Altonji and Blank (1999) and Kunze (2008) for a discussion on gender differences in job mobility and training.

The results are available upon request.

For results on the position of promoted employees in the salary distribution see e.g., Pfeifer (2008).

We also apply a random-effects probit model with bootstrapped standard errors for robustness reasons. The results, which are available upon request, also support the estimates of the pooled probit model.

It is important to note that the definition of the various training categories in the study by Bartel (1995) and our study cannot be compared exactly.

Besides individual targets, subdivisional- and company-specific targets are typically included in a target agreement. The weights of these elements depend on the hierarchical level.

The hypothesis, that the coefficients on training diversity are equal, cannot be rejected at conventional levels (Wald test, p = 0.9483).

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Title: Determinants and effects of intra-firm trainings: evidence from a large German company
Authors: Kathrin Breuer
Patrick Kampkötter
Publication date: 01-02-2013
Publisher: Springer-Verlag
Published in: Journal of Business Economics / Issue 2/2013
Print ISSN: 0044-2372
Electronic ISSN: 1861-8928
DOI: https://doi.org/10.1007/s11573-012-0650-4

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