INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Barriers to and Benefits of CVET for Older Employees

Kurt Schmid

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Outlook

Is age really an important factor for training participation? (Austrian data)

Benefits of CVET (esp. for older employees)

Companies views about training of older employees

Hints and open questions about what drives labour market participation of older people

Based on 4 Austrian & 1 Eurostat datasets:

Austrian Labour Force Survey 2003 ad hoc module LLL

ibw-survey of participants of external CVET courses in 2008 (n = 1.120)

Ibw-survey of training-inactive employees in 2008 (n = 600)

ibw-company survey in 2008 (n = 500)

Eurostat data on training & labour market participation

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Age-specific shares of employees in Austria: Interest, participation and degree of realisation in further training

0%

10%

20%

30%

40%

50%

60%

70%

80%

25-34 y. 35-44 y. 45-54 y. 55-64 y. 65+ Ø all agegroups

shar

e in

%

0%

10%

20%

30%

40%

50%

60%

70%

80%

deg

ree

of

real

isat

ion

interested in trainingtraining participationdegree of realisation

Source: Austrian Labour Force Survey 2003 ad-hoc module LLL; ibw-calculations

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Age-specific EU-25 participation rates informal, non-formal and informal training (in % of 25 to 64 years old)

0%

5%

10%

15%

20%

25%

30%

35%

40%

formal non-formal informal

par

tici

pat

ion

rat

es i

n %

25 to 34 y.

35 to 44 y.

45 to 54 y.

55 to 64 y.

Source: Eurostat, EU Labour Force Survey 2005

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Logistic Regression: influencing variableson CVET participation for Austria

Source: Austrian Labour Force Survey 2003 ad-hoc module LLL; ibw-calculations

Exp. (β) Sig.

constant 0.066 0.000

Gender Female (ref.: male) 0.911 0.000

Part-time Employment (ref.: full time employment) 0.827 0.000

Occupational level (ref.: “residual” employees)

White collar 2.502 0.000

Civil servant 2.743 0.000

Blue skilled collar 1.598 0.000

Educational level (ref.: compulsory education)

Apprenticeship 1.424 0.000

VET School 1.377 0.000

General upper secondary 1.596 0.000

VET College 1.666 0.000

University or similar 2.586 0.000

Age (ref.: 20-34 years)

35 to 44 y. 0.966 0.000

45 to 54 y. 0.826 0.000

55 to 64 y. 0.388 0.000

65+ 0.110 0.000

Non-Austrian nationality (ref.: Austria) 0.822 0.000

Training company (ref.: no training company) 1.017 0.000

Company has training infrastructure (ref.: company has no training infrastructure) 2.734 0.000

& significant

economic sector difference!!!

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Age-specific degree of affirmation (averages) to statements about reasons why respondents did not participate in CVET

Source: ibw-survey of training-inactive employees 2008; ibw-calculations

1 1,666666 2,333332 2,999998

25 - 34 y.

35 - 44 y.

45 - 54 y.

55+

25 - 34 y.

35 - 44 y.

45 - 54 y.

55+

I th

ink

I'm t

oo

old

fo

r it

No

nee

d f

or

furt

her

trai

nin

g b

ecau

se I

wil

lre

tire

so

on

totally agreeing not agreeingpartly agreeing

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Reasons for non-participation in CVET

Source: ibw-survey of training-inactive employees 2008; ibw-calculations

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

inadequate support byemployer

outcome of trainingdoubtful

reservations of "privatenature"

person undertakesinformal training

too busy to have time fortraining

inadequate training offer

no training need

share in %

55-64 y.

45-54 y.

35-44 y.

25-34 y.

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Outcomes of CVET participation I

Source: ibw-survey of training-inactive employees 2008; ibw-calculations

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

backing in findingcurrent job

maintaining currentjob

advancement of jobsituation

no or only minoreffetcs

shares in %

55-64 y.

45-54 y.

35-44 y.

25-34 y.

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Outcomes of CVET participation II: wage effects

Source: ibw-WIFI-survey of participants 2008; ibw-calculations

0%

10%

20%

30%

40%

50%

60%

< 45 y. 45+ 50+ 55+

shar

e in

%

0%

10%

20%

30%

40%

50%

60%

aver

age

wag

e in

crea

se

share of participants with direct wage effect

Ø wage increase

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Companies views about training of older employees I

on average a person is deemed to be an “older employee” if he/she is about 45 years old – yet, pronounced sector differences

Majority thinks that both can profit from training them until or rather close to retirement, i.e. participants as well as companies will gain.

Yet, many companies (about two out of three) made the experience that older employees (compared to younger ones)…

usually have a lower willingness for further training,

are harder to motivate to participate in further training activities,

have different training needs,

need specific incentives for training participation.

There are four arguments companies express why – in their view – older employees often have a lower willingness for further training:

Older employees simply see no need for it and/or they think training will not pay off for them (because they come close to their retirement).

Older employees often argue that they are more experienced and therefore their skills and competences are sufficient.

Fears of failure are more pronounced among older employees (especially in connection with new technologies).

A general decrease of motivation as well as physical/psychical/emotional exhaustion.

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Companies views about training of older employees II

Company views about learning aptitude of older employees: About half of the enterprises think that learning aptitude of older employees is lower than those of younger ones – the other half sees no differences.

Interestingly, there are large inter- as well as intra-sector variances to that aspect.

widespread beliefs, perceptions and ascriptions about older people’s (allegedly) lower learning aptitude and motivation still exist.

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Relationship between non-formal training participation and labour market participation of older people (55 to 64 years) in Europe

Source: Eurostat, EU Labour Force Survey 2005, 2006 or 2007; ibw-calculations

UK

Norway

Switzerland

Sweden

AUSTRIA

DenmarkFinland

R2 = 0,44

0

10

20

30

40

50

60

70

80

0 10 20 30 40 50

non-formal training participation (in %)

lab

ou

r p

arti

cip

atio

n (

in %

)

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Relationship between non-formal training participation and labour market participation of older people (55 to 64 years) in Europe

Source: Eurostat, EU Labour Force Survey 2005, 2006 or 2007; ibw-calculations

AUSTRIA

R2 = 0,00870

10

20

30

40

50

60

70

80

0 10 20 30 40 50

non-formal training participation (in %)

lab

ou

r p

arti

cip

atio

n (

in %

)

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

Conclusions

CVT participation of older employees gains importance because of demographic trends.

But according to training and employment data at EU-level: is there really a (simple) causal link between training and employment of older people?

For most European states country-specific regulations (e.g. legal and actual retirement ages, replacement rates, labour market for older employees etc.) seem to be more important for labour market participation than further training participation.

Beside it is not clear how causality runs: is training participation fostering employability and labour market participation of older people or do countries with a higher share of older people in employment also train them more?

This does not mean that training will be useless. As training data for Austria shows, decisions to participate in CVET as well as outcomes of these training efforts are complex phenomena and are simultaneously influenced by a multitude of factors like educational level, occupational status, company environments and individual cost-benefit considerations.

Chronological age on its own is not a relevant barrier to CVET participation, nor does it impede training outcomes up to about age 55.

What can be observed are large age effects when employees come close to retirement: Five to ten years before retirement interest as well as participation rates for CVET decrease sharply despite positive training outcomes for those older employees participating in further training.

There still exist widespread perceptions and ascriptions of age (e.g. lower aptitude and/or willingness for learning).

Individual survey data from training-inactive employees indicate that older and younger employees do not differ much when reasons for their non-participation are looked at. What really makes a difference between these two groups is the closeness to retirement and the (often combined) view that there is no longer a need for training as well as uncertainties about the realisation potential of training participation.

One way of fostering training participation of older employees seems therefore to provide better mediate that employees will benefit from successful training efforts even if training is undertaken close to retirement age.

INSTITUTE FOR RESEARCH ON QUALIFICATIONS AND TRAINING OF THE AUSTRIAN ECONOMY

ThanX a lot 4 Your patience !!!

schmid@ibw.at