The effects of on-the-job training on wages in Sweden

On-the-job training has a large positive effect on wages for employees in Sweden, and employees in jobs that require long on-the-job training earn significantly more than workers in jobs with short training requirements. The effects of training are large for recently hired and low for senior employees. There are significant wage effects of general and specific on-the-job training, and the effect is significantly larger for general training. Separate estimates for the public and private sectors show significant effects of specific training only for public-sector employees and large effects of general training for private-sector employees. The results suggest that the distinction between general and specific training matters, that firms are willing to pay for general training and that there is heterogeneity in the returns to these forms of training.