FATTENIN’ FROGS FOR SNAKES? COMPANY INVESTMENTS IN JOB SKILLS TRAINING

Abstract

Human capital theory hypothesizes that no firm rationally invests in general job skills training because its competitors might hire the trained employees away before the firm could recoup its costs through higher worker productivity. Drawing from four explanatory perspectives, we developed several research hypotheses about the organizational and environmental sources of variation in company-provided job skills training for core employees, which we tested with a national sample of U.S. work establishments. Contrary to human capital theory expectations, the large majority of employers with core training programs reported providing skills that were either “to a great deal” or “to some extent” useful to other employers. Our general skills training analysis supported only one hypothesis, suggesting the inadequacy of human capital theory for explaining company training investments. We found evidence that the substantive contents of company job skills training programs differentiated into technical skills and social skills dimensions. Multivariate equations supported several hypothesized effects of organizational and environmental factors on the social and technical skills contents of company core training investments. We conclude with a reassessment of the classic general-specific job skills hypothesis and speculate about future directions for job skills training theory and research.