This paper analyzes the structure of wages and investment in general training in imperfect labor markets. It shows that when labor markets are imperfect, firms may invest in the general skills of their employees. This is because wage distortions can turn general skills into specific skills, as trained workers do not get paid their full marginal product when they change jobs. The paper argues that labor market frictions and institutions, such as minimum wages and union wage setting, are crucial in shaping the wage structure and thus have an important impact on training. The results suggest that the more frictional and regulated labor markets in Europe and Japan may generate more firm-sponsored general training than the U.S. The paper also finds that even in the U.S., where the wage structure is less distorted, firms bear part of the cost of investments in general skills. The paper discusses various mechanisms, including minimum wages, unions, search and monopsony, and asymmetric information, that can lead to firm-sponsored training. It concludes that labor market frictions can encourage investment in general training, and that this is consistent with international comparisons. The paper also shows that the presence of firm-specific skills can complement general skills, leading to investment in general training. Overall, the paper highlights the importance of labor market institutions in shaping the structure of wages and investment in general training.This paper analyzes the structure of wages and investment in general training in imperfect labor markets. It shows that when labor markets are imperfect, firms may invest in the general skills of their employees. This is because wage distortions can turn general skills into specific skills, as trained workers do not get paid their full marginal product when they change jobs. The paper argues that labor market frictions and institutions, such as minimum wages and union wage setting, are crucial in shaping the wage structure and thus have an important impact on training. The results suggest that the more frictional and regulated labor markets in Europe and Japan may generate more firm-sponsored general training than the U.S. The paper also finds that even in the U.S., where the wage structure is less distorted, firms bear part of the cost of investments in general skills. The paper discusses various mechanisms, including minimum wages, unions, search and monopsony, and asymmetric information, that can lead to firm-sponsored training. It concludes that labor market frictions can encourage investment in general training, and that this is consistent with international comparisons. The paper also shows that the presence of firm-specific skills can complement general skills, leading to investment in general training. Overall, the paper highlights the importance of labor market institutions in shaping the structure of wages and investment in general training.