Labour market outcomes following education and training

Industry training

In recent years, workplace-based industry training has been growing at a faster rate than other forms of tertiary education and training. Government and industry have substantially increased their investments in industry training. However, there is not much information available on whether training improves participants' skills, productivity, and labour market outcomes. In this paper, we examine the labour market outcomes of employees who left industry training during 2003–05. We use a new dataset constructed for the Employment Outcomes of Tertiary Education Feasibility Study (Statistics NZ, 2009) that assessed whether tertiary education and training data could be linked to Statistics New Zealand's Linked-Employer Employee Dataset (LEED).

Thirty-one percent of those who left industry training during 2003-05 gained a qualification. Thirteen percent gained a qualification at National Qualifications Framework (NQF) level 4 or above, 9 percent at level 3, and 9 percent at level 1 or 2.

Gaining a qualification at level 4 or higher improved participants' earnings. Their average monthly earnings were 7 percent higher than those of comparable nonparticipants 48 months after training started. The impact on average earnings varied considerably by age and sex. Gaining a qualification at level 3 improved the average earnings of males but not females. Gaining a qualification at level 1 or 2, completing a limited credit programme, or gaining no qualification did not improve average earnings during the 48 months after training started.

Employment rates were between 3 and 8 percent higher 24 months after training started for those who completed qualifications or limited credit programmes than for comparable non-participants.

These findings were obtained by comparing the earnings and employment patterns of participants with those of nonparticipants who had very similar demographic characteristics and employment histories before the training started, and are subject to some caveats.

To download the research, follow this link: Does Workplace-based Industry Training Improve Earnings?.

Level 1-6 certificates and diplomas obtained through study at tertiary institutions

This paper investigates the labour market benefits that were obtained by working adults aged 25 to 64 years who enrolled with a tertiary education provider and completed a certificate or diploma at levels 1-6, from 2003 to 2005.

The analysis focuses on people who were employed both before and after their spell of tertiary study, and uses longitudinal administrative data from the Employment Outcomes of Tertiary Education (EOTE) dataset to estimate the impact of education on their subsequent growth in average monthly earnings. The earnings changes experienced by the students over the pre-study to post-study period are compared with the earnings changes experienced by a matched comparison group of working adults who did not return to education.

Students who completed a level 1-3 or level 4 certificate generally did not increase their earnings relative to the comparison group. However, earnings benefits were gained by students who completed a certificate in a small number of fields of study.

On average, diplomas were associated with earnings benefits for women but not men. There were substantial variations by subject field, however, with diploma students in some fields experiencing substantial increases in their relative monthly earnings and those in other fields experiencing relative earnings losses or no effect.

Overall, there was only limited evidence of beneficial impacts. Several factors may have contributed to this result. First, sixty percent of the working adults in the study were already qualified at an equivalent or higher level, and so did not raise their educational attainment level by completing a new certificate or diploma. Second, many certificates and diplomas required the equivalent of one year or less of full-time study to complete. The absence of more significant labour market impacts may partly reflect the short duration of these qualifications.

To download the research, follow this link:
The labour market returns to further education for working adults.