Dual employment protection and (lack of) on-the-job training: PIAAC evidence for Spain and other European countries

Abstract

Abstract Using micro data from the Programme for the International Assessment of Adult Competencies (PIAAC), we first document how having a temporary contract in Spain is associated to lower levels of on-the-job training (OJT). Next, we find that this OJT gap is positively correlated with gaps in the literacy and numeracy scores achieved by these two types of workers in the PIAAC study. Although we choose Spain as a case study of a dual labor market, we also provide cross-country evidence showing that OJT gaps are lower in those European labor markets where dualism is less entrenched than in those where it is more extended.

Keywords

• Dual labor market
• On-the-job training
• Cognitive skills
• Severance pay