Meet the need – the role of vocational education and training for the youth labour market

Abstract

To combat negative trends in the youth labour market, policymakers around the world support vocational education and training (VET) programmes. This paper investigates how enrolment rates in upper-secondary education programmes – general education, school-based VET and dual VET – affect ten youth labour market indicators on integration and job quality. We run first-difference generalized method of moments regressions on panel data of 36 countries for 2004 through 2014. We complement the existing literature by dealing with unobserved heterogeneity across time and reverse causality and by analysing non-linear effects that might arise due to general equilibrium effects. Our findings show that school-based VET and dual VET have different effects: school-based VET's effect on the labour market depends on the outcome indicator and country, whereas dual VET overall improves both labour market integration and job quality. Depending on the labour market indicator, we find evidence for both linear and non-linear effects. In educational reforms, policymakers should therefore consider the non-linear and heterogeneous effects of VET. © 2021 John Wiley & Sons, Ltd.

Keywords

Author Keywords

Not provided

Index Keywords

training Job search returns to education labor market labor relations labor supply Indicator indicator

Author Affiliations

ETH Zürich, Zurich, ZH, Switzerland

Funding & Acknowledgements

Gebert Rüf Stiftung

The authors gratefully acknowledge the financial support of the Gebert Ruef Foundation. We thank the editor and anonymous reviewers for their careful reading of our article and their valuable comments. In addition, for helpful comments and suggestions on earlier drafts, we thank Prof. Dr. A. Diekmann, Prof. Dr. U. Renold, Prof. Dr. J.‐E. Sturm, the members of the Swiss Leading House on Economics of Education, and the participants of all conferences and seminars in which we presented our article. A special thank goes to Natalie Reid for editorial help. All responsibility for remaining mistakes lies with the authors.

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Meet the need – the role of vocational education and training for the youth labour market

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