VET and higher education pathways – do outcomes differ for the same occupation?

Description

This report explores occupations that can be entered into via either a vocational education and training (VET) pathway or a higher education pathway. It examines whether these individuals do the same job tasks and roles, if there are differences in how well the qualifications prepare them for the role and whether they have the same occupation and employment outcomes, such as salary and career pathways.

Summary

About the research

In many occupations there has been a trend towards requiring an entry-level qualification where a qualification was previously not required for the occupation. For various other occupations, the type of qualification needed has changed to one of a higher level. Does this so-called ‘credential creep’ impact on the outcomes for individuals who choose a vocational education and training (VET) pathway as opposed to a higher education pathway?

Using data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey and interviews with employers in four occupations — childcare workers, surveyors, graphic designers and medical laboratory technicians — this research explores whether individuals with VET qualifications and those with higher education qualifications employed in the same occupations are undertaking the same tasks and receiving the same job outcomes, such as salary and career pathways.

Key messages

• Overall, VET- and higher education-qualified individuals in the same occupation undertake the same tasks and receive the same salary initially (with the exception of childcare workers), but over time their differing qualifications lead to different job outcomes and career pathways. Higher education qualifications tend to lead to higher pay, more autonomy, supervisory responsibilities and more opportunities for career progression.
• Employers actively recruit for and employ both VET- and higher education-qualified individuals. When assessing candidates for positions, experience, skills and fit with the company are often more important than the qualification.
• Due to their technical nature, VET qualifications enable new workers to ‘hit the ground running’ when entering occupations compared with those with higher education qualifications. VET graduates have more experience in using tools, equipment and software in their courses.
• Receiving credit for VET qualifications and workplace experience when transitioning to a degree is important in creating pathways from VET to higher education to assist individuals to build upon previous study and transition to higher-skilled occupations, and support lifelong learning.
• Enhanced and more accurate career guidance is needed to enable people to better understand the qualifications required for an occupation and the pathways available to them. This will help individuals such as those starting their careers, those transitioning between occupations and those engaging in lifelong learning to make more informed choices.

Executive summary

The education pathway required for some occupations is clear, for example, apprenticeships for most traditional trades. For other occupations, however, both vocational education and training (VET) and higher education qualification options may be available. This research is interested in finding out whether individuals who choose a VET pathway are undertaking the same tasks and roles and have the same job outcomes, such as salary and career opportunities, as individuals who follow a higher education pathway.

Previous Australian research has found that university degrees generally have greater positive impacts on income and employment status than VET qualifications but that in some instances VET qualifications may be better for males with lower Australian Tertiary Admission Rank (ATAR) scores (Marks 2018; Norton, Cherastidtham & Mackey 2019). In the European context, on the other hand, it has been observed that VET graduates may sacrifice the long-term benefits of higher education in favour of the more immediate benefits of VET (Cedefop 2018). Furthermore, there has been a growing trend for individuals to possess a qualification to enter a job where one was previously not required, a phenomenon known as ‘credential creep’ (Karmel, Stanwick & Moore 2015). This current research takes a different perspective, in that it starts with the occupation and looks at whether the outcomes for both VET- and higher education-qualified workers are the same.

The first stage of the research explores data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, which contains information on the educational and labour market activities for individuals over time. Through this analysis, the labour market outcomes of individuals who work in the same occupations can be compared — for those who have VET qualifications only; those with VET and higher education qualifications; or those holding higher education qualifications only. The occupations examined are at the Australian and New Zealand Standard Classification of Occupations (ANZSCO) 3-digit level, with an extended sample of some 2-digit occupations. Overall, the analysis finds that graduates with VET qualifications have similar rates of employment, including full-time employment, and levels of job satisfaction as those with higher education qualifications. However, VET graduates tend to have lower wages, fewer opportunities for career progression and less autonomy than higher education graduates.

The second stage of the research consists of 20 interviews with employers to investigate their perspectives on both VET and higher education qualifications as entry pathways to occupations, and the values they place on these qualifications. These interviews build upon the HILDA analysis to examine four specific occupations at the 6-digit ANZSCO level — childcare workers, surveyors, graphic designers and medical laboratory technicians — to provide an in-depth understanding of the outcomes of VET-qualified individuals and their higher education counterparts working in the same occupations. The key findings from the interviews indicate that: employers regularly hire both VET- and higher education-qualified people in the same occupations; VET graduates have more practical skills and are more job-ready in the short-term; and that, for most occupations, the job pathways of VET- and higher education-qualified workers differ.

Consolidating the findings from the two stages, it can be concluded that VET- and higher education-qualified individuals in the same occupation initially do the same jobs and tasks and receive the same salary, but that their job outcomes and career pathways alter over time, with the exception of childcare workers, where there are differences in some tasks, salary and outcomes from the beginning. While VET qualifications produce more job-ready graduates (that is, they know how to use tools and equipment), higher education qualifications tend to lead to higher pay, more autonomy, supervisory responsibilities, and more opportunities for career progression. One reason for the differences in job outcomes and career pathways is the longer duration of a degree course and its ability to build additional skills and knowledge in areas such as management, research and underlying theories.

Because of this, pathways from VET to higher education, which include credit for VET qualifications and experience in the workplace, are essential to enabling people to move between sectors, to build on previous study and to undertake lifelong learning. Furthermore, flexible study options — allowing individuals with VET qualifications to undertake degrees while working in industry — are important. It should also be noted that, for those who do not aspire to have supervisory responsibilities, there are opportunities to branch out in their occupation; for example, surveyors could move from engineering to mining surveying.

In addition, better and more accurate career guidance is needed to enable individuals to better understand the qualifications required for an occupation and the pathways available to them. This was a common theme across all occupations examined during the employer interviews. The information relating to qualifications currently on career websites could be improved by updating the content; this could be achieved by engaging with industry to ensure that it reflects the constantly evolving and emerging occupations. Up-to-date websites will help those looking to start their careers, those transitioning between occupations and those engaging in lifelong learning to make more informed choices.