Exploring school-to-work
transitions
Alison Wolf
King’s College London
Today’s World
• Huge expansion in education – in the
developed world, full-time to 18 the norm, in
developed and developing, very rapid growth
in higher education
• Major changes in structure of labour market
• In most developed countries, disappearance
of the youth labour market
Disappearance of the youth labour
market for 16-18 year olds
Recent in the UK which maintained teenage
employment at high levels longer than most
other European countries. Long-standing in
mainland Western Europe.
Large growth in UK enrolments reflects disappearance of youth
labour market, and also low apprenticeship numbers
Percentage in full-time education
100
90
80
70
60
age 16
50
age 17
40
30
20
10
0
1994
2010
FTE numbers of 16-18 year olds in schools plus FE colleges
'000s
600
500
400
Schools
300
FE colleges
200
100
0
1985
1994
2010
Part-time education shrinks among the young
Percentage of 16-18 cohort in education
60
50
40
Part time FE
30
Full time FE
Full time schools
20
10
0
1985
1991
2000
2011
16-17 unemployment
40
ILO Unemployment Rate
ILO Unemployment as a proportion of age group
35
30
Per cent
25
20
15
10
5
0
1992
1993
Source: ONS
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
16-17 employment
80
Employment rate for those not in Full Time Education
Employment rate as a proportion of age group
70
60
Per cent
50
40
30
20
10
0
1992
1993
Source: ONS
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Structurally high unemployment
for 18-24 year olds
More recent, potentially more
amenable to policy interventions but
also highly damaging to those
involved
18-24 year olds
20
ILO Unemployment Rate
ILO Unemployment as a proportion of age group
18
16
14
12
% 10
8
6
4
2
0
1992
1993
source: ONS
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
18-24 year olds
Employment rate for those not in FTE
Employment rate as a proportion of age group
90
80
70
60
50
%
40
30
20
10
0
1992
1993
source: ONS
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Today, the UK is quite
typical of developed
economies in a number of
key ways. Problems of
transition are general and
quite intractable.
Percentage of population aged 15-24 employed: selected OECD countries
80
70
60
50
40
1990
30
20
10
0
2010
Ratio of youth unemployment rate to adult unemployment rate. (16-24 and
25-64)
8
7
6
5
4
1980-4
3
2
1
0
2009
4
Germany
Canada
Netherlands
Japan
United States
Australia
Denmark
Portugal
Spain
Austria
Turkey
Ireland
Slovak Republic
Mexico
Switzerland
Czech Republic
Iceland
Finland
United Kingdom
France
New Zealand
Korea
Hungary
Poland
Greece
Belgium
Sweden
Norway
Italy
Luxembourg
Relative unemployment of young adults: 2009
4,5
Ratio of the unemployment rate of 20-24 year-olds to those of adults (aged
25-64). (OECD Stat Extracts, http://stats.oecd.org/Index.aspx)
3,5
3
2,5
2
1,5
1
0,5
0
Scant reading skills (% 15year-olds)
HE graduates (% age 3035)
STEM (% of all students HE)
Unemployment rate (age
15-24)
Germany is the best-known
‘positive’ outlier – although
they too have labour
market challenges.
Unemployment according to level of
qualification
Transition into low paid work
Qualification
Employment in low paid
work (%)
Overall
male
female
15.5
9.8
22.2
No qualification
40.7
27.8
51.4
IVET
16.9
11.0
23.6
Further training
4.8
2.6
10.6
Higher education
4.5
2.9
6.3
Overall
Source: IAB panel study, 2011
Note: OECD definition of low paid work (wages below two-thirds of median
income)
New transition patterns in higher
education
• Bachelor degrees ‘overloaded’: do not leave students
opportunities to
–
–
–
–
develop practical skills
develop language skills
gain intercultural experience
develop analytical and problem-solving skills in professional area
• Masters degrees as labour market transition currency
• Problems with selective access to Masters degrees
Income according to degree type
Annual income in first
job after graduation
(before tax)
University
Bachelor tradition
degrees
al 1st
degrees
27,700
37,500
Fachochschule
Source: Rehn et al., 2011
33,650
37,250
The Background
Economic change, education and
transitions
The ‘hourglass economy’
• Post-war, huge increase in professional, managerial and
technical jobs. Growth has slowed enormously.
• Huge productivity rises in manufacturing and services have
squeezed the number of skilled jobs in manual and whitecollar middle ranks
• Big increase in numbers of low-paid service job, which require
soft rather than technical skills
• However, these changes, while real, are ongoing, and do not
particularly impact on the young rather than on older workers
Manufacturing as a share of GDP
35
30
25
20
France
Germany
15
UK
10
5
0
1980
2009
The fastest-growing – and the largest growth
800000
700000
600000
500000
400000
2001
2009
300000
200000
100000
0
Conservation officers
Town planners
Paramedics
Educational assistants
Care assistants
Marketing and sales
managers
Labour market participation summer 2013 UK (LFS)
90
80
70
60
50
16-64
40
16-17
30
18-24
20
10
0
Employed
Unemployment rate as a
% actively seeking work
Active
Incidence of long-term unemployment
summer 2013 UK
50
45
40
35
30
Unemployment rate
25
% of whom unemployed >12
months
20
15
10
5
0
16-64
16-17
18-24
25-49
50+
Incidence of long-term unemployment (>12 months) summer 2103
UK
40
35
30
25
Unemployment rate
20
long-term unemployed as % active
cohort
15
10
5
0
16-64
16-17
18-24
25-49
50+
The vast majority get jobs, BUT
• In some areas, unemployment rates are twice
as high as national as national averages
• Many jobs are short term – a lot of ‘churning’
• Most ‘NEETS’ have gone in and out of shortterm employment
• Unemployment scars permanently in many
cases
• ‘High-quality’ progression routes are not
available to many young people
Formal education is increasingly seen as vital
for life-chances, not just as a source of skills
but as a gateway into the upper parts of the
labour market. Employers may complain about
the quality of education (and do, everywhere).
But they use it, constantly, as a screening
device and a ranking device.
High-quality access routes (1): higher education
• Application rates have not been affected
permanently by fees
• Have stabilised since 2010 in England,
Scotland and Wales and even though England
has highest fees, also has highest application
rate (43%)
• Return to a degree has also remained high.
Completion rates are at top end for OECD
High quality access routes (2):
apprenticeship
• Near-demolition of traditional high-quality
apprenticeship route, but where survives,
remains highly desired and shows high returns
• Funding + targets regime (established by
successive governments) resulted in a growing
proportion of so-called apprenticeships being
given to older employees. Decreasing proportion
at ‘level 3’ especially for young people. Huge
excess demand for good placements
Apprenticeship numbers
120,000
100,000
80,000
60,000
40,000
20,000
0
2005
2006
16-18 years
2007
19-24 years
2008
25+ years
2009
2010 prov
Apprenticeship starts 2011-12
180000
160000
140000
120000
100000
80000
60000
40000
20000
0
Under 19
19-24
25+
Current apprenticeship reform of
critical importance
But success not guaranteed – trying
to recreate demolished institutions is
hard
Returns to qualifications
•
•
•
Vocational awards ‘deliver’ as part of apprenticeship: most
lower-level awards delivered in education or by private
training providers do not.
Less qualified young people, and those on active labour
market schemes (eg Work Programme), have been chanelled
into programmes which award these low-status awards with
no progression routes/wage returns
Pre-18, recent reforms have changed the funding system, but
post-18, still payment-by-qualification-awarded: training
providers incentivised to offer easy awards and ensure 100%
success on internally assessed qualifications.
Forthcoming and ongoing reforms
• ‘Study programmes’ for 16-18 year olds in full time education
which prioritise work experience
• English and maths for all lower-achieving 16-18 year olds
• ‘Traineeships’, subsidising work experience
• Wage subsidies
• Apprenticeship reform (barely started yet)
• Qualification reform for 16-18 year olds (general academic;
applied general; technical (occupational) – ‘Tech Bacc’,
currently a level 3 technical/occupation + level 3 maths and
extended project
The prognosis
• Work experience placements – pilots
encouraging
• Wage subsidies – a failure (as has often been
the case with similar initiatives)
• Qualification reform – not yet clear
• English and Maths – better late than never
• Apprenticeship reform – too early to tell but
both key and difficult
Workplace experience is critical
• Saturday jobs
• Substantial work experience
• Traineeships
• Apprenticeships