October 20, 2020

New Research on Training Reveals Disparities

MIT Sloan Professor Paul Osterman

In an economy with many low-wage jobs, employer-provided training can be an important route to upward economic mobility for workers. But which workers receive training? How do workers obtain new skills?

A new research brief by Paul Osterman, the NTU Professor of Human Resources and Management at the MIT Sloan School, offers insights on those questions. 

In the U.S., “there is surprisingly little information collected about the employee experience with employer-provided training and even less about the ways in which individual workers navigate the field of training opportunities,” explained Barbara Dyer, Senior Lecturer and Executive Director of the Good Companies, Good Jobs Initiative at MIT Sloan.  “So the Good Companies, Good Jobs Initiative at MIT Sloan in 2019 launched a project under the leadership of MIT Sloan Professor Paul Osterman to survey a nationally representative sample of U.S. workers about how they obtain training.”

Osterman’s new research brief includes the first findings from that survey, which was conducted in January 2020 and involved a nationally representative sample of 3673 working civilian adults. Osterman’s brief, “Skill Training for Adults,” was published this month by the MIT Task Force on the Work of the Future.

Over half of U.S. working adults surveyed reported receiving formal employer-provided training in the previous 12 months, roughly in line with past studies. Previous research, Osterman points out, has shown that receiving employer-provided training is associated with better economic outcomes for workers.

But the survey results indicate that access to such training is unequal.  African Americans, Hispanics, and Asian Americans are less likely to receive formal training from their employers, the new survey found. Being a member of a union increases the likelihood of receiving formal employer-provided training, as does being college-educated.

“All things considered, the striking feature in all models is the substantial racial and ethnic disparities,” Osterman writes. “Simply put, after all the controls [in the statistical analysis], being African American, Hispanic, or Asian is consistently associated with reduced employer investment in training.”

In addition to reporting some of the survey results in his research brief, Osterman describes and assesses the different components of the decentralized training infrastructure in the United States, from community colleges to nonprofit training intermediaries that work closely with employers.

“A striking fact that is often overlooked in discussions of public employment policy is that to an important extent we know what works,” Osterman writes. “Specifically, we have good evidence that community colleges pay off for students who complete certificates or degree programs and that best practice [training] intermediaries raise the earnings of participants.”

Osterman concludes the brief by calling for a societal commitment to support building U.S. workers’ skills. “If we want to move past isolated examples of best practice and address labor market challenges at both the national and regional levels, it is necessary to achieve a compact among employers, communities, and governments to build a real [training] system,” he writes. “The good news is that we understand many of the elements of such a system and we also have a firm grasp on what we need to learn. Hopefully, the striking juncture in which we find ourselves—a job market crisis and a renewed awakening to racial and ethnic disparities—will provide the impetus to move forward on building such a compact.”

Reported by Martha E. Mangelsdorf  




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