The retention effect of continuous training in different institutional environments: evidence from employee-level data of a multinational enterprise

This article examines the effects of employer-provided continuous training by taking a comparative institutional approach. Using personnel records from a German-based multinational enterprise, we examine the impact of participation in continuous training on subsequent quitting among its employees in China, Germany, India, Mexico, and the United States (N = 19,385; four years of observation). We find that employees who participate in continuous training are less likely to quit the MNE the following year – it appears that continuous training has a retention effect. The retention effect is stronger for general training (compared to specific or mandatory training). For general training, the retention effect increases with training duration, and, paradoxically, it is strongest among the firm’s employees in China, India, and the United States – in countries with high labour mobility and weak initial vocational education and training systems. We explain this paradox by arguing that these institutional environments create more substantial mobility barriers for trained employees. We argue that previous studies lacked appropriate employee-level data and ran the risk of an ecological fallacy, whereby firm- or country-level patterns are mistakenly interpreted as evidence of individual-level links between training and quitting.