Skills, Workforce Characteristics and Firm-Level Productivity: Evidence from the Matched Abi/Employer Skills Survey

IZA Discussion Paper No. 1542

43 Pages Posted: 30 Mar 2005

See all articles by Fernando Galindo-Rueda

Fernando Galindo-Rueda

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP); Institute for the Study of Labor (IZA)

Jonathan Haskel

Imperial College Business School; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Date Written: March 2005

Abstract

We construct firm-level data set with matched productivity and qualification data by linking the Annual Business Inquiry and Employer Skills Survey for England. We first examine the effect of workplace skills and other characteristics such as part-time status and gender on both productivity and wages in English firms. We also investigate how productivity-implied returns to worker characteristics compare with wage-implied returns, therefore providing information on how rents are distributed between employers and employees. We find that firms with a higher share of college-educated, full-time and male workers also tend to be more productive, with considerable variations across sectors. The only robust difference in implied returns follows from part-timers, who tend to work for firms that pay too low wages for the observed productivity differences. Second, we study the effect of local skills on productivity controlling for skills at the firm. We find a positive and robust association, which is consistent with positive human capital externalities.

Keywords: productivity, wages, skills, workforce characteristics, spillovers

JEL Classification: J2, J3, J7

Suggested Citation

Galindo-Rueda, Fernando and Haskel, Jonathan, Skills, Workforce Characteristics and Firm-Level Productivity: Evidence from the Matched Abi/Employer Skills Survey (March 2005). IZA Discussion Paper No. 1542, Available at SSRN: https://ssrn.com/abstract=695226

Fernando Galindo-Rueda (Contact Author)

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Jonathan Haskel

Imperial College Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom
020 7594 8563 (Phone)
020 7594 5915 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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