Research paper on firm human capital investment and wage inequality and employment

Using company-level data from three waves of the Continuing Vocational Training Survey (2005, 2010 and 2015), this paper provides an overview on European firms implementing training and the magnitude of their training effort. We illustrate in the descriptive statistics that there are significant differences in the wage and employment performance across companies in relation to the digital content of their production and training activities. We conduct a regression analysis documenting that a wage premium of 9% is associated with companies undertaking training and that an additional 8% is paid by firms arranging training for IT skills-intensive workers. The latter effect is pervasive across sectors and is not strictly related to industry exposure to the digital transformation. We seek to address both the simultaneity and the selectivity issue of our data implementing an instrumental variable regression and a propensity score matching procedure.