Workplace Transformation and Worker Upskilling: The Perspective of Individual Workers

Abstract

How common is workplace transformation in the American economy? What are its implications for work force skill requirements and training investments? The existing literature addressing these questions is based on firm‐reported survey data. Using new data available in the 1993 wave of the National Longitudinal Survey of Youth (NLSY), this article examines the same questions from the perspective of individual workers. Our empirical results suggest that workplace transformation is commonplace. Fully 40 percent of private‐sector workers surveyed report that in the space of just one year, a change occurred at work that required them to learn new job skills. About 23 percent of all respondents reported experiencing a workplace change we term anorganizational transformation. Incidence of formal training is positively related to indicators of organizational transformation, but the effect of these indicators is found to be sensitive to the inclusion of other important workplace change variables (namely, new products, new equipment, and new government regulations). While we expected to find strong positive relationships with product development and physical capital investment, government regulation has a surprisingly large impact on formal training.