What Do We Know About Continuing
Vocational Education, Training and Work?
                 Philip J. O’Connell
    The Eco...
The Context

► Internationaldownturn
► Rapid increase in unemployment
    Almost 10% in EU 27 in April 2010
    Over 10% i...
Unemployment rates, 2010

25


20


15


10


5


0
     NO NL AU   LU   CY SV MA DK   Cz   DE RO UK   BE BU   IT   SW   F...
Unemployment rates, EU 27, 2009
                                %
All                             8.9
Men                 ...
Several countries combine high unemployment
      (>10%) with large deficits (>5%)

15
          NO
10


 5
              ...
Active Labour Market Programmes

► From  passive income support to active
  assistance with labour market integration
► Su...
Impact of ALMPs for Unemployed

International Research on impact of Active Labour Market
Programmes on participants’ job p...
Programmes with strong market linkages
  show positive effects on employment


                         Market Orientation...
% of Enterprises Providing,
      % of Employees Receiving, Training, 2005


100

80

60

40

20

 0


                   ...
Avge Hours Job-related Training per Trainee, 2005


40
35
30
25
20
15
10
5
0
Training is Highly Stratified

►   People with higher skills or education are more likely to receive
    training

►   The...
The Impact of Training: Employees

The evidence is mixed:

►   Many studies find positive effects of training on wages
   ...
The Impact of Training: Employers

The evidence is sparse:

►   Limited number of studies find that training enhances
    ...
The Information Deficit in CVET
►    Education/Training as investment
►    3 key decision makers
       Individuals/worker...
Enhancing the Information Infrastructure A
   Cost-effective role for national states and ESF
► Monitoring   trends
    Li...
Conclusions
Investment in CVET is a central part of response to crisis

Access to training is stratified
      Those who n...
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Speech ESF and EU2020 - Xavier Prats Monne

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Speech ESF and EU2020 - Xavier Prats Monne

  1. 1. What Do We Know About Continuing Vocational Education, Training and Work? Philip J. O’Connell The Economic and Social Research Institute, Dublin Presentation to conference: Shaping the Future of the ESF – ESF and Europe 2020, Brussels, 23rd and 24th June, 2010
  2. 2. The Context ► Internationaldownturn ► Rapid increase in unemployment Almost 10% in EU 27 in April 2010 Over 10% in Eurozone ► Fiscalcrisis of States ► Need to increase investment in human capital Secure economic and social progress Restore competitiveness
  3. 3. Unemployment rates, 2010 25 20 15 10 5 0 NO NL AU LU CY SV MA DK Cz DE RO UK BE BU IT SW FI PL FR PO EL HU IE SK EE LT ES LV
  4. 4. Unemployment rates, EU 27, 2009 % All 8.9 Men 9.0 Women 8.8 Age < 25 years 19.6 25-74 years 7.6 Education Lower 2nd or below 12.8 Upper 2nd & post 2nd, non 3rd 7.1 3rd level 4.5
  5. 5. Several countries combine high unemployment (>10%) with large deficits (>5%) 15 NO 10 5 LU SW 0 FI EE AU DKDE MA BU HU 0 NL 5 SV IT 10 15 20 25 CY Cz BE SK -5 PL FR RO LT LV PO UK ES -10 EL IE -15 -20
  6. 6. Active Labour Market Programmes ► From passive income support to active assistance with labour market integration ► Supply side Job Search Assistance Training ► Demand Side Employment schemes and incentives ► More influence over distribution than size of unemployment
  7. 7. Impact of ALMPs for Unemployed International Research on impact of Active Labour Market Programmes on participants’ job prospects is inconclusive ► Job Search Assistance Effective for many groups, low cost More effective with monitoring & sanctions? ► Formal Training Inconclusive evidence, targeting is important ► Employment Subsidies Employment: some help LTU Self-employment: high deadweight and displacement ► Public Sector Job Creation Little evidence of any positive effect
  8. 8. Programmes with strong market linkages show positive effects on employment Market Orientation Labour Market Weak Strong Leverage Supply – Weak or Positive Training No Effect - Employment and wages Demand – No Impact on Positive Employment Employment
  9. 9. % of Enterprises Providing, % of Employees Receiving, Training, 2005 100 80 60 40 20 0 Employees Enterpises
  10. 10. Avge Hours Job-related Training per Trainee, 2005 40 35 30 25 20 15 10 5 0
  11. 11. Training is Highly Stratified ► People with higher skills or education are more likely to receive training ► The employed receive more training than the unemployed ► The unemployed receive more training than those not economically active ► Immigrants and members of minority ethnic groups tend to receive less training than native and/or majority populations ► Part-time workers, those on temporary contracts and older workers are less likely to receive training ► Larger firms, and those that pay higher wages are more likely to train their employees. ► Those with the greatest need for training tend to receive less
  12. 12. The Impact of Training: Employees The evidence is mixed: ► Many studies find positive effects of training on wages UK, US, France, Sweden, Ireland -- 3-10% ► Returns are usually higher: General training (rather than specific) Those with upper 2nd than 3rd level education Those with low propensity to train In subsequent jobs When combined with high performance work practices ► Most find that controls for selection / unobserved heterogeneity eliminate estimated effects
  13. 13. The Impact of Training: Employers The evidence is sparse: ► Limited number of studies find that training enhances productivity or other measures of corporate performance Returns may be divided equally between employers and workers Productivity increases for employers, wage gains for employees ► Irish research shows positive effect of training on turnover after 3 years General training has positive effect specific training has no effect
  14. 14. The Information Deficit in CVET ► Education/Training as investment ► 3 key decision makers Individuals/workers, organisations/firms, the state ► 3 information problems 1. What is needed? 2. What is available – cost, quality Individuals are not well informed Problem for small enterprises? 3. What are the returns? Individuals have a rough sense that CVET is good Employers have difficulty measuring returns to training States also have difficulty establishing the returns to CVET
  15. 15. Enhancing the Information Infrastructure A Cost-effective role for national states and ESF ► Monitoring trends Life-long Learning CVET of workers Labour Market Demand ► Collection/dissemination of information ► Costs, fees ► Training content ► Certification ► Guidance services for unemployed, employed and employers ► Research on impact of training – individuals and organisations
  16. 16. Conclusions Investment in CVET is a central part of response to crisis Access to training is stratified Those who need most receive least ► For the unemployed: Labour market linkages are key Training & work experience with strong linkages enhance job prospects ► For Those at work: Some evidence that training increases: ► Wages & productivity - about equally? Are we doing enough? National States and ESF can play an important and cost- effective role in bridging the information gap

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