This study highlights that middle managers are crucial for the success of company training programs. Variation in training participation among employees is strongly linked to differences in managers’ behaviour and practices. Managers who actively engage with employees and focus on their well-being and development achieve higher training participation, leading to improved employee performance and reduced absenteeism, especially during organisational changes.
This working paper investigates why training investments, essential for productivity, often suffer from low participation rates and insufficient worker engagement. It addresses a gap in existing literature by examining how middle managers influence the execution of centrally designed training programs. The study uses detailed administrative data from three large firms in Latin America: an Argentinian car manufacturer, a quick-service restaurant chain, and a large retail company, both based in Colombia. These firms represent different sectors but share a similar three-layered organizational structure with central headquarters, middle management, and front-line workers. Data includes employee training participation, program types, manager-employee relationships, team-level performance, and HR outcomes like absenteeism and turnover. For the restaurant and retail firms, the study also uses self-reported survey data on manager traits and practices.
The researchers document substantial variation in training take-up among employees doing similar jobs within the same firm. This suggests that despite centralized design, HR policies yield different outcomes depending on implementation. They show that this variation is closely tied to differences in middle managers’ behaviour. Middle managers who actively engage with their employees and emphasize their well-being and development foster significantly higher participation in training programs. Conceptually, these differences are linked to managers’ “people skills”. Using statistical models, the study estimates manager “fixed effects” to quantify their impact on training take-up, separate from worker or unit characteristics. Figure 1 shows a wide distribution of these manager training fixed effects, indicating significant differences in managers’ ability to drive training participation. For example, in the car manufacturer, a manager at the 90th percentile is associated with significantly more training programs per working group than one at the 10th percentile. The study finds no strong evidence that High-Training (HT) managers (those above the company median in training value added) simply focus on shorter or simpler programs; they seem to encourage participation across various training types. There is no clear demographic profile associated with being an HT manager based on age, tenure, or gender.
To assess the impact on firm performance, the study leverages “demand shocks” experienced by the firms. These shocks involved centrally imposed production expansions for the car company and the staggered roll-out of a last-mile delivery service for the quick service restaurant and retail firms, both increasing transactions and sales. These shocks required workers to adapt without immediate wage increases, potentially leading to increased workload. The study found that during these periods of organizational change, managerial differences strongly influence employee performance and absenteeism. While overall production increased significantly after the shocks, absenteeism also rose. However, teams led by HT managers experienced better outcomes. Specifically, HT managers increased production without a significant increase in absenteeism, unlike Low-Training (LT) managers whose teams saw large increases in absenteeism after the shock. This differential effect was particularly pronounced for lower-ranked workers and those in occupations more directly impacted by the shock, such as assembly workers in the car plant or cashiers and apprentices in the retail and restaurant firms. The presence of an HT manager, even if newly appointed, was associated with lower absenteeism increases during the shock, suggesting the manager’s ongoing influence, not just past skills accumulation. The findings indicate that HT managers’ impact is related to specific decisions during the shock, including promoting training and promotions while maintaining team stability.
The paper also includes a stylized model that interprets these findings within a framework where middle managers mediate the credibility of firm promises like promotions tied to training. The model suggests that during a shock that increases the need for skilled workers, while the firm might eventually raise wages, in the short run with fixed wages, workers may resort to absenteeism if workload increases beyond optimal hours. The model predicts that HT managers can attenuate this absenteeism response, partly because their teams may have more trained workers and even untrained workers anticipate future rewards, thus engaging in training.
The study’s findings have important implications for how firms design and implement training programs. Public policies often rely on subsidies, assuming training happens automatically once funded. However, this research reveals a significant friction: mid-level managerial support (or lack thereof) can substantially impede or amplify the actual take-up of training. This suggests that policy initiatives focused solely on funding may fail if they don’t account for the critical role of middle managers.
For firms, the research highlights that simply having centrally designed HR policies is not enough; their effective execution depends heavily on middle managers. The critical role of middle managers in training implementation underscores the need for firms to incorporate managerial incentives and practices into the design of training programs. The study demonstrates that managers who emphasize employee well-being and development, and actively communicate and advocate for training opportunities, are key to increasing participation.
Furthermore, these differences in managerial behaviour have tangible impacts on firm performance, particularly in challenging periods. Teams led by managers who effectively promote training are better able to cope with sudden increases in demand, showing higher productivity and lower absenteeism compared to teams under less supportive managers. This suggests that investing in developing middle managers’ “people skills” and their ability to champion employee growth and training is not just about HR policy execution, but a direct driver of resilience and performance during change. By demonstrating the link between manager type, training engagement, and performance outcomes like absenteeism, the study establishes a novel connection between managerial effectiveness and workforce skill accumulation.
Raffaella Sadun – Harvard Business School and Digital Reskilling Lab
https://www.hbs.edu/faculty/Pages/profile.aspx?facId=541712&click=byline
Jorge Tamayo – Harvard Business School and Digital Reskilling Lab
https://www.hbs.edu/faculty/Pages/profile.aspx?facId=1063486
Training within Firms. Brayan Diaz, Andrea Neyra-Nazarrett, Julian Ramirez, Raffaella Sadun, Jorge Tamayo. Working Paper: Harvard Business School (April, 2025)
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