Retention of trainees: A study with dichotomous dependent variables

Abstract

Because short term on-the-job training tends to be most useful in the sponsoring company that provides the training, it is important to be able to predict the probability that a trainee will stay with the sponsoring company after training. Certainly not all of the benefits of training will be lost when trainees leave the sponsoring company. Nevertheless, the company specific nature ofshort term onthe-job training makes it unlikely that those who leave will benefit much from the training. This point has been emphasized by many writers. It is implied by Becker (1964, p. 18) in his definition of specific training as ‘training that increases productivity more in firms providing it’, and in his definition of completely specific training as ‘training that has no effect on the productivity of trainees that would be useful in other firms’. In their work on dual labour markets, Doeringer and Piore (1971) stress the importance of training as a device to move workers from the secondary into the primary labour market. Since short-term government supported training in industry generally takes place in well established firms that operate in the primary labour market, then the retention of trainees by these firms can be taken as evidence that these workers are now working in the primary labour market. In his discussion of labour as a quasi-fixed factor of production, Oi (1962) emphasized that firms are reluctant to lay off trained workers in a recession for fear of being unable to rehire them when prosperity returns. Consequently company specific training serves to stabilize employment over the business cycle, and such a benefit is lost when companies do not retain their trainees who receive company specific training.