CEET Annual Conference28 October 2011

The contribution of VET to a more inclusive Australia

Tom Karmel

The value of completion VET qualification rates are terrible But, does it matter......

► yes it does Does this have anything to do with social

inclusion► yes it does

Outline Model the pay-off to completion Identify the groups with the highest pay-offs Relate the pay-offs to intention to complete

and completion Think about the implications

Outcome variables employed after training further study after training employed or further study after training improved employment circumstances after

training occupational status after training wages after training

Methodology Run separate models for graduates and

module completers Predict outcomes for every individual,

assuming that they are graduate/module completer

Pay-off=graduate outcome/module completer outcome

Simplification Focus on

► employment after training► study after training► wages for full-time workers (after training)

Employed after training

ActualPayoff

0

1

2

3

4

t

0 10000 20000 30000 40000 50000

Further study

ActualPayoff

0

1

2

3

4

5

6

7

8

t

0 10000 20000 30000 40000 50000

Salary full timeActualPayoff

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

t

0 10000 20000 30000 40000 50000

Summary of pay-offs after trainingAverage pay-off (%) %>0

Employed 21.7 95.6

Further study 122.7 97.7

Employed or further study

28.2 99.9

Improved employment 34.8 95.1

Salary (FT) 0.3 60.7

Salary (PT) 14.3 73.5

Occupational status 2.3 58.9

Employment status after trainingPopulation

pay-off = 21.7%

Unemployedpay-off=

32%

Other; Businesspay-off=

14.6%

Other Service

s; Commu

nity Service

s; Technic

alpay-

off=47.9%

Not in labour force

pay-off=108.3.8%

Diploma & Higher

; Cer

t III/IV

pay-off =

65.1%

Year 12pay

-off=

96.9%

<Year 12 &

Cert

I/IIpay

-off= 134.1%

Employedpay-off= 2.8%

Further StudyPopulation

pay-off =122.7%

Employedpay-off=

99%Diploma & abovepay

-off=

57.6%

Cert III & IV

pay-

off=

93.9%

Cert I

& IIpay

-off= 141.5%

Unemployedpay-off= 158.1%

Not in labour force

pay-off=217.5%

Diploma &

above; Cert III

& IVpay-off=

172.3%

Cert I/II

pay-off=

274.7%

Salary full timePopulation

pay-off =0.3%

Cert I & IIpay-off=-0.6%

Cert III & IVpay-off=

1.8%Employedpay

-off=

0.3%

Not in Labour force

pay-

off=

7.0%

Unemployedpay

-off=

8.3%

Diploma & above

pay-off=6.6%

Employedpay-off=

4.9%

Not in Labour force; Unemployedpay-off

= 13.7%

Summary It pays to complete in respect of employment

or further study For employment, pay-off is highest for those

not employed before training For further study, pay-off is huge, and highest

for cert I/II, and depends on employment status before training

Those doing diplomas, or a cert III & not employed before, get higher wages by completing

The link with completion Question. Are those who benefit more from

completion more likely to complete? Answer. No. Question. Are those who benefit more from

completion more likely to intend to complete? Answer. No.

Probability to complete

Estimated Probability

0.4

0.5

0.6

0.7

0.8

0.9

1.0

t

0 10000 20000 30000 40000 50000

Probability to completePopulation

84.9%

Part Time

74.9%Personal

reasons

69.5%

Employment

76.4%

Further study

74.0%

Full Time

99.6%

Probability of intending to completeEstimated Probability

0.52

0.54

0.56

0.58

0.60

0.62

0.64

0.66

0.68

0.70

0.72

0.74

0.76

0.78

0.80

0.82

0.84

0.86

0.88

0.90

0.92

0.94

0.96

0.98

1.00

t

0 1000 2000 3000 4000 5000 6000 7000

Probability of intending to complete

Population

95%

Part Time

91.6%

Other

77.2%

Other

Service

s

87.1%

Business;

Technical

93.1%

Communit

y Service

s

95.4%

Full Time

97.2%

Correlations with prob of completionPay-off to:

Employment after training -.08

Full-time study after training -.23

Salary for full-time employment after training -.08

Intending to complete .58

Correlations with intention to completePay off to:

Employment after training .04

Further study after training -.33

Salary for full-time employment after training 0.14

Modelling the probability of completionVariable Estimate

Intercept -0.16

Probability that student intends to complete 1.03

Satisfaction with training 0.008

Final comments Our analysis is helpful in specifying groups

for performance indicators. Gives an insight into where public funds

should go? Low completion rates do need to be

addressed.► payment on completions?