Offshore employment practices: An empirical analysis of routines, wages and labour turnover

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Abstract.

Theories of efficiency wage and human capital formation suggest that both should have a significant influence on employee turnover in offshore manufacturing sites. This influence is explored and examined empirically with a stratified, random sample of northern Mexican maquilas — the historical choice for offshoring in that country and one of the world's earliest and most enduring offshore manufacturing sites. Statistical tests reveal the strong influence on production-level turnover of direct wages and human capital formation when the latter variable is measured in terms of “maquiladora generations”. The distinctive human resource practices of the maquiladora generations are then presented and discussed.

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