Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/223810
Authors: 
Mühlemann, Samuel
Pfeifer, Harald
Wittek, Bernhard
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers 13368
Abstract: 
A firm's expectation about the future business cycle is an important determinant of the decision to train apprentices. As German firms typically train apprentices to either fill future skilled worker positions, or as a substitute for other types of labor, the current coronavirus crisis will have a strong and negative impact on the German economy according to the current business cycle expectations of German firms. To the extent that the training decision of a firm depends on its perception of the business cycle, we expect a downward shift in the firm's demand for apprentices and consequently also a decrease in the equilibrium number of apprenticeship contracts. We analyze German data on the apprenticeship from 2007 to 2019 and apply firstdifferences regressions to account for unobserved heterogeneity across states and occupations, allowing us to identify the association between changes in two popular measures of business cycle expectations (the ifo Business Climate Index and the ifo Employment Barometer) and subsequent changes in the demand for apprentices, the number of new apprenticeship contracts, unfilled vacancies and unsuccessful applicants. Taking into account the most recent data on business cycle expectations up to May 2020, we estimate that the coronavirus-related decrease in firms' expectations about the business cycle can be associated with a predicted 9% decrease in firm demand for apprentices and an almost 7% decrease in the number of new apprenticeship positions in Germany in 2020 (-34,700 apprenticeship contracts; 95% confidence interval: +/- 8,800).
Subjects: 
apprenticeship market
COVID-19
coronavirus
business cycle expectations
JEL: 
J23
J24
M53
Document Type: 
Working Paper

Files in This Item:
File
Size
948.34 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.