HRSDC-IC-SSHRC Skills Research Initiative

Working Paper Series

Employer-Supported Training in Canada: Policy-Research Key Knowledge Gaps and Issues
by Zhengxi Lin and Jean-François Tremblay.

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Abstract

Firms' investment in training makes a substantial contribution to human capital formation. However, there are concerns that firms are under-investing in training because of various market failures and barriers that exists, providing a rationale for policy intervention. This paper explores some of the main knowledge gaps facing policy-makers in the area of employer-supported training with the objective of identifying key policy-related research avenues that could be pursued further. Our selective review focuses on research directions that could potentially improve our understanding of: 1) the main covariates of training and the key factors behind Canada's relative performance in this area; 2) how firms' training decisions are affected by various factors including the structure of labour markets, innovation and technology adoption, organizational change, firm life-cycle patterns, the state of excess demand for skills in the labour market and policies; 3) the empirical importance of specific market failures related to training decisions and the form of appropriate policy responses.