Technological change and employer‐provided training: evidence from UK workplaces

This paper sets out to examine the link between technological change and continuing training at a workplace level.

The paper hypothesises that workplaces subject to technological change have an increased demand for skills, which induces an increased provision of training. UK data from two waves (1998 and 2004) of the Workplace Employment Relations Survey (WERS) are used to investigate this hypothesis.

Workplaces undertaking technological change are more likely to train their workers and also to provide more days of training per worker. Team working is also associated with a greater number of days spent on training, as are the setting of training targets and the keeping of training records. Training intensity decreases with an increasing share of part‐time and manual employees. Conversely, where workplaces face difficulties in filling skilled vacancies, they provide more days of training.

The WERS training questions refer only to core experienced employees which, since this group may vary from one workplace to another, may not give a completely consistent measure of either absolute or relative training provision. Because the WERS panel (1998 and 2004) excludes both the dependent variable (training intensity) and the variable of interest (technical change), the analysis is restricted to cross‐section estimation. Causal implications of this analysis should be regarded as correspondingly tentative.

The findings suggest that one way to induce firms to provide more training is by enhanced incentives for firms to undertake more rapid technological change. In addition, if the current global economic downturn persists, evidence that operating in a declining market is associated with the provision of fewer training days may be of particular concern to training professionals and policy makers.

The paper provides empirical evidence concerning the interaction between technological change and training.