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Abstract
An empirical investigation was conducted to verify whether schooling
influences productivity in the Ethiopian Public Manufacturing
Industries. The results indicate that schooling influences the
productivity of manufacturing enterprises significantly; viz, the higher
the proportion of the labour force with a high level of schooling in an
enterprise, the higher is productivity. This implies that increasing the
proportion of social wealth expended on education is paying and that
the education system in Ethiopia seems effective in translating skilled
manpower into services. This, in turn, implies that not only broadening
schooling in terms of quantity, but also deepening schooling by
fostering quality could increase the productivity of manufacturing
enterprises. Thus, government has to intervene in supplying skilled
manpower since there is a serious risk of private under-investment in
training at a firm level. However, for successful industrialisation to take
place, any government move to supply these resources should involve
the beneficiaries in order to balance demand and supply; give
emphasis to tertiary education as strongly as basic education; and
synchronise with other supportive schemes since human capital investment on its own cannot lead to the industrialisation of a country.