Training, employability and the E-miles employability voucher scheme

Do you ever consider your own employability? In this article, ROA project manager and researcher  Ruud Gerards presents his research on the E-miles employability voucher scheme and its effects. This research is an example of one of the UM´s three main research themes: “Learning and Innovation.”

Interested in training?

Do you ever read the brochure or e-mail message from the Human Resources department outlining the training courses offered to you? Many workers across all education and job levels do not. This may be because they think they do not need any training to do their job.

However, is this the job they want to continue doing for the rest of their career? And will technological or organizational changes not alter the demands on the workers to keep doing their job?

What if you never take any training course? Will you continue to be a valuable employee for your company and will you be able to successfully compete against other candidates for a new job in a different company? In other words, if you do not participate in any training course or do not even consider the training courses offered to you, how “employable” will you be over time?


Learning and Innovation: The E-miles employability voucher scheme
Ruud Gerards, Opening of Academic Year 2012, Maastricht University

What is “employability” and how does it link to training?

The term employability is used in many different contexts, often without a clear definition. That is why I would like to present one before I continue.

“Employability refers to the capacity and willingness of workers to remain attractive for the labor market (supply factors), by reacting to and anticipating changes in tasks and work environment (demand factors), facilitated by the human resource development instruments available to them (institutions).” (De Grip, Van Loo and Sanders, 2004)

What becomes clear is that workers who do not take consideration of their employability, run the risk of becoming unattractive for the labor market. Luckily, we know from many studies that training can have a positive effect on variables such as wage, productivity and career opportunities*.

Therefore, it is clear that training, when the human resources department is able to offer it and the worker is able and willing to participate in it, plays a vital role in the maintenance and development of employability.

It is not easy, however, to motivate employees to participate in training, or to even read a brochure with training offerings. How can employers stimulate their employees to think about their employability and to participate in training?

The Philips E-miles voucher scheme

In 2009, Philips started the E-miles voucher scheme to make workers across all levels of education aware of the importance of continuous personal development and draw their attention on the notion of employability. Under the E-miles ((E)-mployability miles) scheme, all Philips employees received a voucher worth 1,000 E-miles, which could be redeemed for training courses that would increase their insights in their own employability and further career opportunities. We label this their “employability awareness”.

Andries de Grip, Maaike Witlox and myself have analyzed the E-miles voucher scheme and focused on two main questions:

[1] Which workers spend the voucher?

[2] What is the effect of voucher use on “employability awareness” and on the willingness to participate in future training?

Our analysis built on two surveys carried out among a representative sample of Philips’ workforce, the first one before and the second one after the E-miles voucher scheme was introduced.


An interview with Ruud Gerards: the E-miles employability voucher scheme

Which employees use their voucher?

To answer the first question we looked at various personality traits and personal characteristics as well as a number of control variables. We found that women and workers with longer tenure spend their voucher more often and that workers’ ambition, goal setting and education level are positively related to voucher use. These were expected outcomes and hardly raised eyebrows.

We also found, however, that workers who are negatively reciprocal** spend their voucher less often. They may perceive the voucher as an HR tool for outplacement. This is not the intention of the voucher and we recommended the communication to employees regarding the voucher to be tailored so as to minimize the likelihood that workers view the voucher with suspicion.

What are the effects of voucher use?

To answer the second question we used the two surveys to measure workers’ employability awareness before (baseline) and after introduction of the voucher scheme (effect). We analyzed the development in employability awareness by looking at respondents’ changes in answer between the two surveys on several questions such as: “I myself am responsible for my future development”. While doing so, we distinguished between workers who spent their voucher and workers who did not and corrected for differing personalities and other personal characteristics.

We found that workers who use their voucher and thus participate in employability training, show a significant improvement of their employability awareness compared to workers who do not spend their voucher and hence do not take employability training.

Workers who use their voucher also show an increased willingness to invest in future training compared to those who do not spend their voucher. Increasing a worker’s employability awareness and willingness to train can be considered as an early intervention to help safeguard the worker’s future employment.

What’s in it for the firm?

Increased levels of employability awareness and willingness to train in a company imply that employees have a greater awareness of who they are, how they want to develop themselves, which steps they need to take to get there and are more willing to participate in training to get there.

Assuming that companies are best served by having the right people on the right spot, increased employability awareness and willingness to train among workers may help companies achieve just that.

 

By Ruud Gerards

Ruud Gerards (The Hague, 1977) is project manager/researcher at the Research Centre for Education and the Labour Market (ROA) . He obtained his PhD degree in economics at Maastricht University in May 2012.

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* See for example Bartel (1995), Krueger and Rouse (1998), Booth and Bryan (2002), Sanders and de Grip (2004) Kuckulenz & Zwick (2004), Dostie (2010) and Gerards (2012).
** When a person feels harmed by another person and is eager to react with a response of equal magnitude, the person is said to be negatively reciprocal. It is the other side of positive reciprocity.

 

Further reading:

•  Bartel, A. (1995). Training, wage growth, and job performance: Evidence from a company database. Journal of Labor Economics 13 (3), 401–425.
•  Booth, A.L. and Bryan, M.L. (2007). Who pays for general training in Private Sector Britain? Research in Labor Economics 26, 85-123.
•  Dostie, B. (2010). Estimating the returns to firm-sponsored on-the-job and classroom training. IZA Discussion Papers No. 5258.
•  Gerards, R. (2012). Unemployment and employability: how firms can help. Universitaire Pers Maastricht, Maastricht, ISBN 978-94-6159-146-3.
•  De Grip, A., J. Van Loo, and J. Sanders (2004). The industry employability index: Taking account of supply and demand characteristics. International Labour Review 143 (3), 211–233.
•  Krueger, A. and C. Rouse (1998). The effect of workplace education on earnings, turnover, and job performance. Journal of Labor Economics 16 (1), 61–94.
•  Sanders, J. and A. de Grip (2004). Training, task flexibility and the employability of low-skilled workers. International Journal of Manpower 25 (1), 73–89.

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