: In many developing countries the skill base is a cause of concern with respect to
international competition. Firm-provided training is generally seen as an important tool for
bridging the skills gap between labour force and private sector demand. Yet little is known about
how successful such training may be in closing the gender wage gap. We use a matched
employer–employee panel dataset to assess why firms train and whether formal training affects
wage outcomes in Vietnamese SMEs. Training is generally found to be firm-sponsored and
specific in nature. We find that training is associated with a wage increase of 7–22 per cent for
female workers only, depending on the analytical approach taken. We also show evidence that
the wage increase is associated only with on-the-job training and that lower ability workers are
more likely to be trained. Our findings indicate that, at least in Viet Nam, firm-sponsored onthe-job
training helps close the gender wage gap.