Retaining through training even for older workers

This paper investigates whether on-the-job training has an effect on the employability of workers. Using data from the Netherlands we disentangle the true effect of training incidence from the spurious one determined by unobserved individual heterogeneity. We also take into account that there might be feedback from shocks in the employment status to future propensity of receiving firm-provided training. We find that firm-provided training significantly increases future employment prospects. This also holds for older workers, suggesting that firm-provided training may be an important instrument to retain older workers at work.

► We investigate the effect of firm-provided training on employability.
► We find that firm-provided training significantly improves the employment prospects.
► The positive effects of firm-provided training also holds for older workers.
► Firm-provided training may be an instrument to retain older workers at work.