Mechanisms for enhancing employer investment in training: a comparative perspective

Abstract

In recent years, the debate over reform to national vocational education and training systems has shifted from a focus on the supply‐side of VET—qualifications structures, national training schemes and institutional structures—to demand for training by industry and the role of employers in increasing the skills levels of the workforce. Yet, enhancing employer demands for training has proved to be a perennial problem for governments of all political complexions in the developed world. Approaches to securing enterprise investment in training by governments form a continuum from low‐level intervention to compulsion and regulation, and range from approaches which attempt to secure voluntary commitment through to legislating enterprise expenditure on training. Voluntary commitment is often seen as the most desirable and self‐sustaining approach, but is difficult to secure from enterprises. As a result, governments have often experimented with policies of compulsion to make employers invest in training such as training levies. However, decisions about expenditure on training ultimately depend on individual employer's interests, values and commitments. Improving and enhancing employers' perceptions of the value of training are vital to increasing the levels of expenditure. This paper discusses the range of government approaches to encouraging employers to invest in training and development that are to be found in the developed world. It argues that compulsory employer levies are rarely successful and that increasing the level of investment in training by employers is more likely to be achieved through more subtle policy mechanisms.