The Welsh Government is seeking to expand and broaden the use of LMI across Wales. This is one of a regular series of articles which will be appearing in the DYSG newsletter and on the Learning and Skills Observatory website - http://www.learningobservatory.com
A recent report sends a very positive message to young people about the long-term value of vocational qualifications such as NVQs, BTEC and City & Guilds, as well as the benefit of apprenticeships. The report demonstrates the positive impact the majority of vocational qualifications have on employment and wages, echoing the findings of previous research.
In line with previous studies, the report, which analysed a wide range of data to provide results that are exceptionally robust, shows that there continues to be large and significant wage gain for the vast majority of vocational qualifications.
The study found that gaining a Level 1 qualification adds approximately 3% per year to earnings in the seven years after finishing the qualification. The return associated with a NVQ Level 2 qualification is higher at approximately 5% immediately after completion, rising to 14% after 7 years, although returns to NVQs vary significantly by sector.
A number of qualifications offer immediate and sustained benefits. City & Guilds Level 3 qualifications, for example, are associated with an earnings premium of between 5% and 7% per annum. In contrast, NVQ Level 3 qualifications are associated with a small negative earnings return in the first three years after completing the qualification. However, a positive earnings return emerges in the fourth year and increases to more than 14% after seven years.
The impact of education and training on getting a job is also clearly identified with all vocational qualifications associated with an increased likelihood of being in employment.
Those gaining a Level 1 or Level 2 qualification receive an employment boost that is immediate and ongoing. Whilst those completing NVQ Level 2 perform better than average with over 4% employment boost immediately after qualification rising to over 8% seven years later.
Although initially negative, those finishing BTEC Level 2 achieve the greatest long term employment boost of almost 9% after seven years, while those gaining City & Guilds perform marginally above average with a 3% employment boost rising to almost 6% after seven years.
The report also showed that those completing qualifications at all levels were less likely to be dependent on benefits such as Job Seekers Allowance or Incapacity Benefit.
The impact of undertaking and completing an apprenticeship was also examined. The earnings impact in the first year after completing a Foundation Apprenticeship is over 24% compared to those who do not complete the apprenticeship. The earnings premium associated with gaining an Advanced Apprenticeship is over 25% relative to non-completers.
The report clearly demonstrates a significant correlation between vocational qualifications and employment and earning potential - a highly positive messages for young people and their careers advisors.
The report was produced by the Department for Business, Innovation & Skills and is available at:
http://www.bis.gov.uk/assets/biscore/further-education-skills/docs/l/11-1035-long-term-effect-of-vocational-qualifications.pdf
If you have any comments about the sorts of LMI you value in your work and how LMI has been of benefit to you, we’d like to hear from you. For this and further information about the LMI project contact Rachel Stephens, Senior Skills Policy Manager at the Welsh Government at rachel.stephens2@wales.gsi.gov.uk
