DP762 Apprenticeships and Job Tenure: A Competing Risks Model with Time-varying Covariates

Author(s): Alison L Booth, Stephen E Satchell
Publication Date: February 1993
Keyword(s): Apprenticeships, Competing Risks, Employment Duration, Job Mobility, Training
JEL(s): J24, J38
Programme Areas: Human Resources
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=762

The paper examines the extent of apprenticeships in the first job for a cohort of young men entering the labour market at age 16 in the late 1970s. The impact of the apprenticeship on employment duration and early labour market mobility is estimated. The data set used is the National Child Development Study. The conditional logit estimates of the probability of starting an apprenticeship indicate that apprenticeships were found in a core of industries, in large firms, and were associated with higher-ability workers. There were no significant differences between apprenticeship provision in the public and private sectors. Competing risks models of the hazards of exit from the first job into a number of competing destinations are also estimated. Estimates from models with and without explicitly modelling the timing of training produce broadly similar results. Completed apprenticeships reduced the exit rate to each destination, while terminated apprenticeships increased each exit rate, relative to the base of no training. The finding for completed apprenticeships suggests that both employers and apprenticed youths wished to continue the employment relationship. Employers were relatively more likely to retain trained workers, since involuntary layoffs were reduced by completed apprenticeships. Moreover, trained workers were relatively more likely to want to stay, since voluntary quits were reduced by completed apprenticeships.