The Wage Effects of Training in Portugal: Differences across skill groups, genders, sectors, and training types

Abstract

This paper investigates the determinants and wage effects of training in Portugal. In a first stage, we show that there are considerable differences in training participation across groups of workers, with elder and low educated individuals participating substantially less. In a second stage, we show that training has a positive and significant impact on wages. The estimated wage return is about 30% for men and 38% for women. Discriminating between levels of education and working experience, and the public and private sector reveals important differences across categories of workers. We find that women, low educated workers, and workers with long working experience earn larger returns from training. The average effect of training is similar in the private sector and the public sector. However, differences across experience groups are larger in the private sector, while differences across education groups are larger in the public sector. We use three alternative classifications of training activities, and find that training in the firm, training aimed to improve skills needed at the current job, and training with a duration less than a year are associated to larger wage gains.