CEET Annual Conference
28 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
4
3
2
1
0
0
10000
20000
30000
t
40000
50000
Further study
ActualPayoff
8
7
6
5
4
3
2
1
0
0
10000
20000
30000
t
40000
50000
Salary full time
ActualPayoff
1.4
1.3
1.2
1.1
1.0
0.9
0.8
0.7
0
10000
20000
30000
t
40000
50000
Summary of pay-offs after training
Average 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 training
Population
pay-off =
21.7%
Unemployed
pay-off=
32%
Other;
Business
pay-off=
14.6%
Other Services;
Community
Services;
Technical
pay-off=47.9%
Diploma &
Higher; Cert
III/IV
pay-off =
65.1%
Not in labour
force
pay-off=
108.3.8%
Employed
pay-off=
2.8%
Year 12
pay-off=
96.9%
<Year 12
& Cert I/II
pay-off=
134.1%
Further Study
Population
pay-off
=122.7%
Employed
pay-off=
99%
Diploma &
above
pay-off=
57.6%
Cert III & IV
pay-off=
93.9%
Unemployed
pay-off=
158.1%
Cert I & II
pay-off=
141.5%
Not in labour
force
pay-off=
217.5%
Diploma &
above; Cert III
& IV
pay-off=
172.3%
Cert I/II
pay-off=
274.7%
Salary full time
Population
pay-off
=0.3%
Cert I & II
pay-off=
-0.6%
Cert III & IV
pay-off=
1.8%
Employed
pay-off=
0.3%
Not in
Labour force
pay-off=
7.0%
Diploma &
above
pay-off=
6.6%
Unemployed
pay-off=
8.3%
Employed
pay-off=
4.9%
Not in Labour
force;
Unemployed
pay-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
1.0
0.9
0.8
0.7
0.6
0.5
0.4
0
10000
20000
30000
t
40000
50000
Probability to complete
Population
84.9%
Personal
reasons
69.5%
Part Time
Full Time
74.9%
99.6%
Employment
Further study
76.4%
74.0%
Probability of intending to complete
Estimated Probability
1.00
0.98
0.96
0.94
0.92
0.90
0.88
0.86
0.84
0.82
0.80
0.78
0.76
0.74
0.72
0.70
0.68
0.66
0.64
0.62
0.60
0.58
0.56
0.54
0.52
0
1000
2000
3000
4000
t
5000
6000
7000
Probability of intending to complete
Population
95%
Other
77.2%
Part Time
Full Time
91.6%
97.2%
Other Services
87.1%
Business;
Technical
Community
Services
93.1%
95.4%
Correlations with prob of completion
Pay-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 complete
Pay off to:
Employment after training
.04
Further study after training
-.33
Salary for full-time employment after training
0.14
Modelling the probability of completion
Variable
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?