Work in Progress

The Role of VET in Preventing the Scarring Effect

• Summary
• Purpose
• Approach
• Research questions
• Methodology

Summary

Purpose

Using data from the Longitudinal Surveys of Australian Youth, this project will investigate the persistence of unemployment for Australian youths and the amount of “scarring” it causes (that is, the extent to which current unemployment increases the risk of future unemployment). The role of VET will be made explicit given the hypothesis that the scarring effect will differ substantially for youth with a VET qualification from those without. That is, the hypothesis to be tested is the having a VET qualification will diminish scarring effects.

Approach

Quantitative

Research questions

The main research question this project will address is:

• Are individuals with a VET qualification who have experienced previous periods of unemployment more, less or equally likely to experience future unemployment periods compared to individuals who do not have such qualifications?
  

Methodology

The statistical approach will be to estimate dynamic panel probit models where the outcome of interest is the probability to be unemployed. Included in the list of explanatory variables will be various indicators for the level of VET qualifications and -in order to address the persistence of unemployment, or ‘scarring’ effects- indicators for previous periods of unemployment. Examples of such indicators for VET qualifications could be the level, e.g. Certificate I, II, III, or IV. In addition, or alternatively, indicators could reflect if the qualification was obtained at a private provider or indicate not the level of the qualification but the field of education.

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