This paper discusses the relationship between employee turnover costs and firmsponsored training Turnover costs are workers private information which follows certain distributions Firms offer different wages to inside workers and outside workers Firms onthejob training influences workers productivities as well as turnover costs The “compressed wage structure” (CWS) theory in the literature only consider wageproductivity differential This paper considers a labor market with duopolistic employers, where turnover rats and training levels are endogenous It is suggests that CWS is not the only reason that firms invest in general training Higher turnover rate can be associated with more training, which means efficient training and efficient allocation may be gotten both at the same time More sophisticated implications are offered for enterprises management and social policies, for instance, the dual training system in Germany and some other countries.
