Training Opportunities for Older Workers

The Effect of Age on the Propensity to Offer Training to Employees.

Purpose – The aim of this thesis is to examine age discrimination by employers in their training provision. Furthermore, I examined if the type of training (i.e., the subject of training) and the employer’s personal & organizational characteristics influence older worker’s probability to receive training offerings.
Design/methodology/approach – I use unique survey data from the Dutch public sector, collected by the Research Centre of Education and Labor Market (ROA). The survey contained a stated preference experiment, which relies on a vignette study, and additional questions regarding employer’s personal and organizational characteristics. The final estimations are based of 6,342 observations. Estimation analyses where done by OLS regressions and fixed effects and conditional logit models when necessary.
Findings – I found evidence for a negative significant relation between employee’s age and the likelihood to receive training opportunities. I found no support for the influence of training aim, nor for employer’s personal characteristics. The interaction between employee’s age and share of permanent contracts within the employer’s firm was, however, positively significant. This implies that even though older workers are less likely to receive training opportunities, this effect is less big when the organization employs many workers with a permanent contract.
Practical implications – Even though training is a key factor in facing an ageing workforce, this thesis shows that employers are still less willing to invest in training opportunities for older workers. Employers need to be made aware of the fact that older workers are faced with an extension of their working lives and consequently will be in the organization for additional amount of time. Creating policy measures that increase this awareness could mitigate the negative age effect on training opportunities. Moreover, policy measures could be developed that enhance the attractiveness of long-term employment relationships, as the result show a smaller negative age effect on training opportunities in organizations with a large share of permanent contracts.
Contribution –Research on age discrimination focuses almost exclusively on hiring decisions and is conducted by using field experiments that lack information about the individual who offers the job or training to employees. This is problematic as the employability of older people on the labor market is most likely not only affected when being unemployed, but is also affected during working life. Using data from a survey that combines a vignette study with items regarding the employer’s personal and organizational characteristics fills this gap. The experimental character of the vignette study allows me to causally investigate whether age discrimination is present at the work place. Moreover, the link with survey data allows me to investigate several drivers behind the age discrimination behavior of employers.