Low levels of education generally among people with a disability is one of the factors contributing to their lower rate of labour market participation. What role vocational education and training (VET) plays in ameliorating this is the focus of this report. Using data from the Household, Income and Labour Dynamics of Australia surveys, the report finds that for people who are not working, completing a VET qualification does increase the chance of employment and more so for people with a disability.
About the research
The Australian Bureau of Statistics (ABS) 2003 Survey of Disability, Ageing and Carers found that nearly one in five Australians has a disability, with only about half of those of working age participating in the labour market, by comparison with over 80% of 15 to 64-year-olds without a disability. A low level of education generally among people with a disability is one of the factors contributing to their lower rate of labour market participation.
Using data from the Household, Income and Labour Dynamics in Australia (HILDA) survey, this study examined whether completing a vocational education and training (VET) qualification helped people with a disability to get a job and stay in employment. While the study found completing a VET qualification provided no further employment benefits for those already employed, for people who are not working, completing a VET qualification significantly increased the likelihood of subsequent employment—more so for people with a disability than without. The authors suggest that the accessibility of VET, by comparison with other post-school education pathways, may make this pathway more attractive for people with a disability, while the attainment of demonstrated competencies or skills is a positive signal to employers.
This study, which makes use of the longitudinal aspect of the Household, Income and Labour Dynamics in Australia survey, is an important contribution to policy deliberations about the provision of education and training opportunities for people with a disability. It suggests that helping people with a disability get a ‘first job’ is likely to reduce the scarring effect that being out of work has on future employment prospects.
- While people with a disability find it considerably harder to retain employment, VET completion strongly improves their chances of getting and keeping a job.
- Childhood onset of a disability is more disruptive than onset in later life. This is in line with the hypothesis developed by the economist Heckman that disruption of skill acquisition at an early age has cumulative effects.
- People for whom the onset of a disability occurs later in life are more likely to be employed. This may be due to skill acquisition before the onset of disability but, more importantly, it may be because they have work experience. However, they are less likely to participate in VET.
- Attrition from VET courses occurs at a greater rate among people with a mental health condition, who report that they are often unable to access help from others.
Managing Director, NCVER
The disadvantaged position in the labour market of people with disabilities has been well documented in most Western developed economies, including Australia. This study aims to provide evidence on the influence of vocational education and training (VET) in the Australian labour market on the relative position of people with and without a disability.
Findings from previous studies show that people with disabilities have a much lower labour market participation rate than their counterparts without a disability (Mavromaras, Wang-Sheng Lee & Black 2006; Wilkins 2004). Further, when they are employed, people with a disability find it harder to retain their jobs, and when they are out of work they find it harder to become re employed. There is also evidence that, compared with people without a disability, those with a disability were less likely to participate and complete a VET course (Cavallaro et al. 2003) and that people with a mental illness had particularly low rates of completion (Karmel & Nguyen 2008). The main aim of this report is to identify the degree to which the completion of a VET qualification can ameliorate the employment disadvantage of people with a disability, an exercise that is vitally important for the design of policies that enable people with a disability to overcome labour market disadvantage.
This report is based on multivariate regression methods that use the longitudinal nature of the 2001–07 Household, Income and Labour Dynamics in Australia (HILDA) survey data to analyse individual employment status, before and after the completion of a VET qualification. The main question is whether the completion of a VET qualification increases the likelihood of employment and, if so, whether this differs by disability status. The longitudinal aspect of the survey data allows for the measurement of employment outcomes for a period of up to three years after completing a VET course. The presence of longer-term employment probability improvements means that, not only may VET be able to help people with a disability to re engage in the labour market, but it may also help to keep them in employment.
Employment outcomes benefits from VET
The report examines the relationship between disability and employment and finds that the presence and the severity of disability are negatively associated with employment participation, in terms of both being employed and regaining employment. Conversely, the presence and the severity of disability are found to be positively associated with losing employment and being out of work. These are not novel results in the literature, but they are the most up-to-date results for the Australian labour market, confirming and quantifying a serious facet of labour market disadvantage suffered by people with disabilities.
The relationship between the completion of a VET qualification and subsequent employment status changes is also examined, with a focus on VET qualifications at the level of certificates III and above. The report finds that completing a VET qualification significantly increases the employment probability of all labour market participants. It also finds considerable state dependence1 at a level which accords with international estimates from both the United Kingdom and the United States labour markets.
The examination of employment outcomes is concluded by looking at whether the employment disadvantage suffered by people with disabilities is ameliorated by the completion of a VET qualification. For those who were in employment (either with or without a disability, VET completion had no effect on their subsequent employment probabilities throughout the three years covered by the data. By contrast, for those not working at the start of the period during which they completed their VET, its completion improves subsequent employment probabilities, much more for people with a disability. For an average person out of work and who has a disability, completing VET is estimated to increase the probability of employment from 9% to 29% in their first year after completion. By contrast, for an average person out of work who does not have a disability, completing a VET course is estimated to increase their probability of employment from 52% to 62% in their first year after completion.
The report suggests that the greater effectiveness of VET in improving the employment probabilities of people with disabilities is due to the nature of VET as a post-school pathway. We argue that VET is more accessible than all other post-school educational pathways and that this attribute is of particular value for people with disabilities who may experience added difficulties in obtaining education and in subsequently utilising education qualifications in the labour market. VET may also be more beneficial to those with a disability because it provides assurances to employers that a job candidate’s disability does not hinder their ability to perform tasks that are relevant to their prospective job.
A point of note is that completing a VET qualification not only helps those out of work find employment, but it also helps them find continuous employment. For an average person out of work with a disability, completing a VET qualification is estimated to lead to a ten-percentage-point increase in their chances of being in work for up to three consecutive years after VET completion. For an average person out of work without a disability, completing a VET qualification is estimated to lead to a seven-percentage point improvement in their chances of being continuously in work for three years after completion. The longer-term employment benefits of VET completion suggest that, not only does VET help prepare people for work, but it equips them with the skills to maintain employment.
Potential barriers to participation and completion of VET
Despite the greater employment benefits from completing a VET qualification for people with a disability, no significant differences in the participation and completion rates of VET between people with and without a disability are found. However, for people with a mental health condition, the group that suffers the greatest employment disadvantage of any disability group (independent of education), the report finds that if they report that they are ‘often unable to find help from others’, they also drop out of VET at a greater rate. There is no estimated discrepancy in completion rates for those who report that they are usually able to find help. This finding is consistent with the findings from a previous National Centre for Vocational Education Research (NCVER) study by Miller and Nguyen (2008). They found that the academic progress of VET students with a mental illness was often hampered by a reluctance to use student support services. In some cases, they found that students could not use student support services because they declined to declare their disability. Our study confirms the importance of ensuring adequate help for people with a mental health condition.
1 The degree to which being employed today increases the chances of being employed tomorrow. Refer to box 1 for a more detailed explanation of state dependence
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