Training and enterprise performance in transition: evidence from China

Abstract

The role of training and its impact on company performance is studied in different types of enterprises in a transitional economy. A sample of manufacturing enterprises is drawn, using China as a case study. The findings indicate that training is perceived to be relatively important in non-state-owned enterprises (non-SOEs). Training objectives have three major dimensions, namely enhancing working relationships, tackling skill deficiencies and skills development. SOEs tend to focus more on skill development, while non-SOEs emphasize both enhancing working relationships and skills improvement. Comparing the expectations of training and the perceived achievement of training objectives, the gap is seen to be small within all types of enterprises, and training effectiveness is perceived to be similar. The production function estimation shows that there is a positive relationship between training expenditures and enterprise productivity.

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