Labour Market Prospects of Swiss Career Entrants after Completion of Vocational Education and Training

Abstract

This study seeks to find the reasons for the rising risk of unemployment for people who have completed basic vocational education and training (VET) in Switzerland. We focus on the long-term structural shift on the demand side of the labour market and its consequences for new entrants' chances of employment in the labour force. A detailed analysis of the development of vacancies for such 'career entrants' in the time period 2001 to 2011 suggests that neither a growing occupational mismatch nor a general shift in the level of education to the disadvantage of workers with vocational education can be made responsible for the rising unemployment of labour market entrants. Instead, the available evidence indicates that a diminishing part of the vacancies suited for VET graduates remains open to entrants because of the increasing job requirements with regard to work experience and further education. Basic vocational education and training alone is increasingly less a guarantee for a smooth entry into the working world. Stefan Sacchi is senior researcher at the Swiss Youth Panel ′Transitions from Education to Employment′ (TREE, University of Basel) and at the ′Swiss Job Market Monitor′ (University of Zurich). His current research interests focus on the impact of institutional arrangements and labour market structures on educational and career mobility and social inequality. 1 Labour Market Prospects of Swiss Career Entrants after Completion of Vocational Education and Training AbstractThis study seeks to find the reasons for the rising risk of unemployment for people who have completed basic vocational education and training (VET) in Switzerland. We focus on the long-term structural shift on the demand side of the labour market and its consequences for new entrants' chances of employment in the labour force. A detailed analysis of the development of vacancies for such 'career entrants' in the time period 2001 to 2011 suggests that neither a growing occupational mismatch nor a general shift in the level of education to the disadvantage of workers with vocational education can be made responsible for the rising unemployment of labour market entrants. Instead, the available evidence indicates that a diminishing part of the vacancies suited for VET graduates remains open to entrants because of the increasing job requirements with regard to work experience and further education. Basic vocational education and training alone is increasingly less a guarantee for a smooth entry into the working world.

Fixed-Term Jobs after Vocational Education and Training in Switzerland: Stepping Stone or Impediment?

“…Drawing on findings and considerations by Gebel (2010), one potential explanation may be that VET graduates who completed vocational education at a high level of demand and in particular those who obtained a vocational baccalaureate may plan to enrol in education at tertiary level after gaining some initial work experience, such that they may not in all cases be in search of a first permanent position. In light of the increasing job requirements affecting job prospects for VET graduates in Switzerland Salvisberg and Sacchi 2014), another explanation may be that entry into more demanding jobs open to VET graduates who pursued more demanding vocational education may also be governed by some initial screening. Some less demanding occupational fields of training with comparatively worse employment and career prospects, such as agriculture & gardening or gastronomy & hairdressing, also show some overrepresentation of VET graduates in fixed-term entry employment.…”

Scarring effects of early unemployment among young workers with vocational credentials in Switzerland

“…Therefore prolonged job search and career-adjustment in early work life may not negatively impact subsequent employment outcomes of the young in Switzerland. The assumption that there are no distinct scarring effects further finds support in the fact that, for many skilled young entrants in Switzerland, unemployment spells are short in duration (see Sacchi and Salvisberg 2012). Thus foregone work experience due to early unemployment among young skilled entrants is generally low, and no profound psychological scars may be expected in this regard.…”

“…As institutional settings such as weak employment protection legislations (OECD 2013a) and high standardisation of VET presumably do not provide strong incentives for employers to base their hiring and wage-setting decisions on the young applicant's short work histories and transition processes, we expect that in the Swiss context VET graduates will not be substantially affected by unemployment scarring. This assumption finds further support in that unemployment spells of young skilled workers are generally of short duration in Switzerland (see Sacchi and Salvisberg 2012). Whether these potentially advantageous institutional settings indeed manage to offset unemployment scarring will be put to the test within this paper.…”

“…Loss of work specific skills due to unemployment periods is seen as leading to lower productivity and thus to worse occupational prospects when returning to the labour market (see Edin and Gustavsson 2008;Mooi-Reci and Ganzeboom 2012). Yet, as skilled labour market entrants in Switzerland mainly experience short spells of unemployment (see Sacchi and Salvisberg 2012), human capital depreciation is presumably not very important as missed work experience may not be extensive. The duration of unemployment is further considered to drive unemployment scarring from an application-behavioural viewpoint.…”

“…Even though skilled workers, particularly those who have undergone vocational education and training, fare comparatively well when transiting to the labour market, they are nevertheless increasingly facing problems at labour market entry in Switzerland (Salvisberg andSacchi 2013, 2014). The fact that early unemployment may not only be a temporary blemish but can evolve into permanent scars (Ellwood 1982) is theoretically and empirically well established.…”