Vocational Education

Lifelong learning and skill flexibility are especially important for workers in China, where structural economic adjustment has generated 22 million layoffs from state-owned enterprises since 1997. Skills that were in huge demand in previous years, such as accounting, international trade, and language translation, are now facing serious oversupply pointing to the need for a workforce that is both highly educated and adaptable. On-the-job training, which is mostly informal and is usually carried out within a firm while the worker is still working, and off-the-job training, which takes more formal forms and is usually outside of the firm, are two activities that increase skills and employability. Using data collected from nearly 3500 urban Chinese residents aged 25-65, it was found that off-job training in previous firms significantly raises wages at current firms, while previous on-job training has no effect on current wages. However, after controlling for unobserved motivations and abilities, the training-wag