Economic activity was uneven during the nineties in Canada which prompted the authors to conduct a study. The decade had begun with a brief recession in 1991 but thereafter output and employment expanded…
Standard of living depends on the skills of the labor force. Thus, any nation’s economy depends upon the skills that the labor force possesses. Education and training are lifetime activities related to the working career but it is difficult to evaluate the training decisions based on the business cycle as there are many other factors that influence the training decisions. As labour market conditions improve it becomes essential to train the workforce. Training is influenced by the ‘business cycle’. As business activity increases hiring too has to increase because businesses require more staff. The staff also needs to be trained and hence as employers add staff they also undertake to train the staff. However, the ‘opportunity cost’ in training the staff is higher in a robust economy and this can reduce the incidence of training. However these are counterbalancing influences which make it difficult to relate training to business cycle. A thorough study would entail examining the entire workings of the Canadian economy which is a long-drawn process. The authors decided to restrict their query to evaluate whether the AETS instruments provide a consistent explanation of training incidence and duration for both men and women. Overall education level increased between 1992 and 1998 and more women opted for university degree. Several factors suggest that training too should have increased during this period. Based on the human capital model training should increase. Besides, between 1994 and 1998 business activity and employment rose, and this also is an indicator of rise in training. However, an aging population would imply reduced training levels. Besides, data analysis revealed changes in several factors that influence training levels. As the education level rose, people became more urban. Lifestyle changed resulting in delayed marriages and late children; men keeping out of unionism and preferring to be in employment rather than be self-employed. Men preferred to work for larger but private firms while women preferred the public sector. All these make it difficult to deduce the training duration and incidence based on the economy and business cycles. This gives rise to the query as to what factors influence an individual to undertake training. The authors draw a parallel between the human capital and the physical capital. Just as the stock and quality of physical capital comprising of machinery, equipment and computers can be augmented through investments, human capital too can be upgraded through training activities. Adults may undertake training for various reasons. This could range from a simple desire to upgrade skills after an absence from job market to desire for career advancement. Participation in training can occur at all stages in the life cycle of an individual. Thus, based on these probabilities, this study evaluated the factors that influence training decision. It further describes the incidence of training activity during the 1990s among adult Canadians who were not part- or full-time students in any education program. The study is based on a core model of human capital accumulation over the life cycle. Various factors that influence training participation and duration were taken as the variables in this study. These include age, job tenure, hours worked and past education level. The control variables included in the study were sex, family circumstances, region of residence and firm size. Data pooled from 1992, 1994 and 1998 Adult Education and Training Surveys (AETS) were statistically analyzed. The AETS survey (1998) was the sixth in the series but for this study only the data from three surveys were compiled. The purpose of AETS was to measure participation rates for learning and training ...
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