Job mobility and heterogeneous returns to apprenticeship training in Italy

This paper provides empirical evidence on the effect on wages of the mobility across firms and sectors of apprentices after graduation in Italy over the period 1997–2013. We use administrative data and employ an instrumental variable approach to account for endogenous mobility due to observed and unobserved worker characteristics. Our main finding is that job switchers not in the economic sector of the training firm faced a significant gap in wages in comparison to stayers, indicating a loss of firm- and sector-specific human capital. In addition, under the new apprenticeship rules introduced in 2003 by the Biagi reform, which lessened the stringency of the norms on the training content delivered by firms, both within- and across-sector job switches had large negative effect on wages, suggesting a reduction in the transferability of skills for trainees relatively to the previous regime.