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Source: University of Auckland

The value of on-the-job training should not be underestimated, according to a University of Auckland study, which found that over-educated and over-skilled employees are less likely to quit if training is available.

The study, detailed in the paper ‘Educational job mismatch, job satisfaction, on-the-job training, and employee quit behaviour: A dynamic analytical approach’, is the first to test the impact of on-the-job training and job satisfaction among job-mismatched employees.

The researchers found that over-education alone, or accompanied by skill under-utilisation, in combination with lower job satisfaction, increases incidences of job quitting. However, on-the-job training decreases the likelihood of over-educated, over-skilled workers quitting, says study co-author and professor of economics Sholeh Maani.

Another key finding is that over-educated and over-skilled employees may stay with their present employers if they otherwise have high overall job satisfaction.

Over-education is prevalent across economies, and statistics from OECD countries classify 35.7 percent of the workforce in qualification-mismatched jobs, says Dr Maani, who has been working on a series of papers in the areas of lifetime economic returns to education, and educational mismatch, in particular, over-education and over-skilling.

“There’s a relatively high percentage of people in both New Zealand and Australia who are in jobs where their credentials and years of education are above what is required, and this is why we’re undertaking research in this area,” she says.

“We examined the career trajectories of employees in mismatched jobs and provide new evidence that on-the-job training contributes significantly to their retention. Specifically, the analysis provides additional understanding of how on-the-job training can be utilised to reduce recruitment and training costs.”