High school graduates, human capital formation and labour demand

By exploiting a new and rich firm-level dataset, we provide some evidence on labour demand by Italian manufacturing firms, with a focus on high school graduates, and we estimate the factors underlying the decision to engage in work-based training, as well as its relative intensity. Relying on a job competition mechanism of skill formation, we stress the role of the strategic complementarity between innovation and firm organization. Our results show that training propensity is affected by firm size, capital intensity, skill composition, R&D, investments in new machinery and organizational change following technological change. No relevant effects emerge from labour cost and internationalization activities. These results hold particularly for the decision to provide both formal and informal training together. Finally, R&D and techno-organizational innovations also affect the intensity of training, both in terms of training costs and in terms of the employment share of trainees.