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Margaret Hilton
I n a recent report to Congress, the Office of Technology Assessment concluded that "Good training pays off-for the individual worker whose skills are upgraded, for the company seeking a competitive edge, and for the Nation-in overall productivity and competitiveness."1 But the report found that only a few U.S. firms use training as part of a successful competitive strategy, in contrast to competitor firms in Germany and Japan. Further research based on the Office of Technology Assessment report demonstrates that employers in what was formerly West Germany spend twice as much as U.S. firms on worker training.2 The key to this investment is that German employers can pool the costs and benefits of training through strong industry and trade associations. Given the findings regarding training in Germany,3 U.S. firms could benefits greatly from following the German approach.
German investments in training
German workers receive two major types of training:
apprenticeship and further training. About 65 percent of each
class of middle school graduates enter apprenticeship training in
fields ranging form skilled manufacturing to office work. Over 3
years, these would-be-apprentices spend 4 days per week in
on-the-job training and at least 1 day per week at a
state-supported vocational school. This thorough training does
not come cheap: a 1984 study (the most recent available) by
Research Institute of the German Economy concluded that employers
spent a total of 21.6 billion deutsche marks annually to train
some 1.7 million young people.4 (This estimate
excludes the wages and value of work produced by apprentices.)
This excerpt is from an article published in the March 1991 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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Footnotes
1 U.S. Congress office of Technology assessment, Worker
Training: Competing in the New International Economy, Report No.
OTA-ITE-457 (Washington, U.S. Government Printing Office, 1990).
2 Office of Technology Assessment, Worker Training, p. 3.
3 The term "Germany" as used throughout this article refers to the former Federal Republic of Germany (West Germany)
4 Research Institute of the German Economy, "Ausbildungskoten 1984," Informationen zur beruflichen Bildung, March 24, 1986, p. 2.
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