To complete the Journal article, “A Road Map To Vocational Education And Training In Industrialized Countries”Order DescriptionThe Journal Article that I’ll upload to you guys later.Please read the Journal,“ A Road Map To Vocational Education AndTraining In Industrialized Countries” and finish the reading critique that according to the following criteria:1. Briefly describe the journal and its focus2.Summarize the article you have chosen so that readers have an understanding of the article’s purpose, argument, content, and conclusions.3. which of the course you topics does the article address(e.g. economy, transformation, popular culture, etc)? if it doesn’t fall under one of the course topics, which aspect of adult education do you think it addresses? what did you learn about the topic from the article? what are the article’s strengths and limitations?4. what are your reactions and reflections on the article? For this question, you need to be creative in how you present your responses. For example, you might record a discussion you had, present your reaction as a dialogue, or create a picture, poem, mind map, or graphic representation of your reflections to complement your summary.5. Prepare a few discussion questions engage with in relation to your Journal article.ILR Review, 68(2), March 2015, pp. 314–337DOI: 10.1177/0019793914564963. © The Author(s) 2015Journal website: ilr.sagepub.comReprints and permissions: sagepub.com/journalsPermissions.navA Road Map To Vocatio nal Educatio n AndTraining In Industrialized CountriesWerner Eichhorst, Núria Rodríguez-planas,Ricarda Schmidl, and Klaus F. Zimmermann*Young people have been among those most affected by the recentfinancial crisis. Vocational education and training (VET) is oftenviewed as the silver bullet for the youth joblessness problem. In thisarticle, the authors provide a better understanding of VET in industrializedcountries, proposing a typology with three types of vocationalsystems: 1) vocational and technical schools, 2) formalapprenticeships, and 3) dual apprenticeship systems that combineschool training with a firm-based approach. They first describe thestrengths and challenges of each system. They subsequently reviewthe evidence of the effectiveness of VET versus general educationand the relative effectiveness of the different VET systems. Resultsindicate that VET is a valued alternative beyond the core of generaleducation and that the use of apprenticeships combined withinstitutional learning tends to be more effective than school-basedVET.Unemployment rates among youth have soared since the Great Recessionof 2008, doubling the adult unemployment rate in many developedcountries. While many young people have responded to sluggish labormarket prospects by continuing tertiary education and investing in theirhuman capital, others have withdrawn from education, training, andemployment. According to OECD (2013) data, youth unemployment ratesare now above 35% in countries such as Portugal and Italy and are above50% in Spain and Greece, while they are still below 10% in countries such asGermany, Switzerland, and Austria. The share of youth (aged 15 to 24) inneither employment nor education (NEET) in 2012 ranged from 4 to 7% inthe Netherlands, Denmark, and Switzerland and up to 18% or more in*Werner Eichhorst is affiliated with IZA. Núria Rodríguez-Planas is affiliated with Queens Collegeof CUNY and the Institute for the Study of Labor (IZA). Ricarda Schmidl is affiliated with the Universityof Mannheim and IZA. Klaus F. Zimmermann is affiliated with IZA and Bonn University. We thankCostanza Biavaschi, Corrado Giulietti, Michael Kendzia, Alexander Muravyev, Victoria Finn, and JannekePieters for their input and support. Inquiries can be directed to [email protected] [email protected]/0019793914564963ILR ReviewVocational Education And Training In Industrialized CountriesKeywords: vocational education and training, apprenticeships, dual VET, vocational schooling,developed countriesVocatio nal Educatio n And Training In Industrialized Countries 315Greece and Italy.1 Regarding the situation of young labor market entrants,the 2008 crisis and its aftermath clearly highlighted the interaction of acyclical development with long-standing institutional features governing thetransition from school to work. The situation deteriorated particularly inthose countries where young people had difficulty entering the labor marketeven before the crisis, while other countries succeeded in maintaininglow youth unemployment rates by a variety of means.Against this background, we look at the role of various types of vocationaleducation.2 Vocational education and training (VET) is frequently perceivedas the solution to improve the opportunities of youth who lack theresources, skills, or motivation to continue with higher education. Forexample, in countries such as the United States, the recent economic crisishas reignited an earlier discussion of building up a larger and more effectiveapprenticeship system (Harhoff and Kane 1997; Lerman 2012).3 In particular,researchers, policy advisors, and other experts often argue that VETprovides useful skills to prepare youth for a smooth entry into the laborforce (Quintini and Martin 2006) by aligning initial education more closelyto particular vocations and tasks demanded in the labor market.After classifying VET in industrialized countries into distinct systems, wereview the evidence on their effectiveness in facilitating transitions intoemployment and in raising earnings, and highlight the relevant institutionalfeatures that support the effectiveness.4 With this, we aim to provide evidencethat can be crucial in designing programs to counteract the labormarket problems exacerbated by the Great Recession.A Typology of VET ProvisionThis section provides a typology of VET provision, reflecting the variousVET models found in practice among a range of countries. This topologyfocuses on two dimensions. First, differences in provision may be viewedalong a continuum, reflecting the relative importance of institutional learningand workplace training. At one extreme, vocational schools can provideVET that is not complemented by work-based training; at the other, older1NEET rates are taken from the OECD employment database and are based on national labor forcesurveys.2In this article, we use the term “vocational education and training” (VET) to refer to qualifying educationpaths that provide individuals with occupation-specific knowledge and practical skills, independentof the place, content, and educational provider. Our focus is on initial VET, in contrast tovocation-specific education and training as part of life-long learning (see Arulampalam, Booth, andBryan 2004; Bassanini et al. 2007 for workplace training in Europe). A related study (Zimmermann,Biavaschi, Eichhorst, Giulietti, Kendzia, Muravyev, Pieters, Rodríguez-Planas, and Schmidl 2013) connectsvocational training with youth unemployment around the world, including developing countries.The novel feature of our paper is the systematic and updated review of the major types of vocationaltraining systems from a policy perspective.3Of course, VET is complementary to the various policies boosting labor demand (typically industrialpolicies) in its goal to improve youths’ transition into employment.4In medium-income countries and in the developing world, an alternative classification is appropriate;see Zimmermann et al. 2013 and Eichhorst, Rodriguez-Planas, Schmidl, and Zimmermann 2013.316 ILR Reviewunion-dominated apprenticeships did not include formal theoretical institutionallearning. A second dimension is whether institutional-based learningis provided within formal secondary school frameworks (part of the educationsystem) or at vocational training centers (which often have close tiesto industry). Below we review these three systems.Vocational and Technical Secondary SchoolsMany countries maintain a large vocational schooling system as part of theirupper secondary education. In these countries, the initial schooling systemis characterized by the duality between general and vocational education.While the former aims to provide youth with general, often academicallyoriented knowledge as the basis for further (higher) education and training,VET provides youth with practice-oriented knowledge and skills thatare required in specific occupations. VET typically follows a formal curriculumthat combines general and occupation-specific knowledge. Compulsoryschooling integrates VET as an alternative to an academically orientedschooling track, or as part of several post-compulsory education options.Similar to academic education, the skills that vocational schools provide aremostly general in the sense that they are transferable between employers(Becker 1964); however, there might be differences in the degree of transferabilityacross occupations. While some countries have a VET system thattransmits skills that are not restricted to one particular occupation, othersprovide vocational schooling for specific types of occupations (Shavit andMüller 1998).Why Do Governments Offer School-Based Vocational Training?The supply of VET by governments through the educational system can bejustified as a means to improve the opportunities of youth who lack the skillsdemanded in the labor market, the ability or motivation to continue withhigher education, or the funding to pursue higher education. Furthermore,individuals might prefer this option to academic education as it implies ashorter human capital investment and facilitates earlier entry into the labormarket. Many countries that provide a vocational schooling option duringcompulsory schooling perceive this as an alternative for poor academic performanceor at-risk youths (Neuman and Ziderman 1999), as well as a safetynet for early school dropouts and those who are less academically inclined.The close link to work tasks and hands-on practical experience may motivatepractically oriented youths to continue training and to remain in schoollonger. Furthermore, researchers have argued that establishing a vocationaleducation track during school is a means to reduce the influence of parentalbackground on educational choices, thereby increasing intergenerationalmobility. Given that the educational decisions of youths are oftenlinked to the educational attainment level of their parents, participation ina vocational track might allow those from working-class backgroundsVocatio nal Educatio n And Training In Industrialized Countries 317to pursue educational attainment beyond the compulsory level, henceincreasing their chances of attaining skilled rather than unskilled employment(Shavit and Müller 1998).In most cases, participation in either vocational or academic courses duringschool is operationalized by tracking students in the two respective pathways.The benefits of such a tracking system are not clear, as leaving schoolwith vocational qualifications often translates into reduced options of furtherpost-compulsory education, particularly the academic type. The incentiveeffect of learning more practice-oriented skills might therefore be mitigatedby high costs of later switching to academic education. Although thetechnical possibility of transferring to academic education might exist, earliertracking will lead to strongly divergent levels of skills and competences(Woessmann 2008). Furthermore, through separating higher and lowerperforming students, VET might counteract the equalizing potential ofvocational education (Shavit and Müller 2000). Given that very few youthmanage to enter academic education after vocational schooling (Kogan2008), populations in many countries often have a low regard of the vocationalschooling option since they perceive it as a dead-end track and asecond-choice education.Southern European CountriesMost of the vocational training in Spain takes place in school instead ofwithin a firm: Only 4% of those in vocational upper-secondary education inSpain combine school- and work-based training (CEDEFOP 2010). Similarly,three in four young people in vocational training in France participatein school-based vocational training as opposed to the apprenticeship alternative.In Italy, firm-level vocational training is not widespread since it isused only in crafts, retail, and large manufacturing companies, and is basedon fixed-term employment contracts.Youth in these countries face particular difficulties when trying to enter thelabor market, especially since the recent economic crisis has aggravated theselong-standing problems. In addition to having above-average NEET rates,labor market entry is difficult for both low- and high-skilled young people.One major factor is the deep labor market segmentation between permanentand fixed-term contracts, which can be attributed to strict dismissal protectionand largely liberalized temporary employment. Another issue is wagecompression in low-skilled occupations by collective bargaining. For instance,collective bargaining in Spain, which is centralized at the province and industrylevel, sets “entry minimum wage” above the legal minimum wage, inflatingthe lower part of the wage distribution and resulting in relatively high earningsfor young workers and those least qualified. Together, employment protectionand wage compression make it difficult in Spain for youth to becomeestablished in the labor market and to transition to a permanent position.Such effects on youth employment have been found in previous internationalwork such as Bertola, Blau, and Kahn (2007) and Kahn (2007).318 ILR ReviewIn some of these countries, the relatively marginal role of vocationaltraining can be explained not only by a limited interest of employers inmore formal vocational training (given the dual-employment structure) butalso by strong expectations of upward social mobility on behalf of youngpeople and their families, which creates strong preference in favor of academictraining (Planas 2005). Moreover, a long tradition in these countriesis to subsidize temporary employment and training contracts as part ofActive Labor Market Policies (ALMP). The effectiveness of these measuresis questionable, however, as explained by Felgueroso (2010) in Spain, Rogerand Zamora (2011) in France, and Tattara and Valentini (2009) in Italy.Evidence from cross-country comparisons in Europe, which haveattempted to implement vocational schooling systems, points to the necessityof several systematic elements to ensure success, as described below(Woessmann 2008; Gambin 2009):1. Ensure curricula relevance: All stakeholders (government, employers,social partners, educational institutions) need to be involved in curriculumdevelopment, with a clear assignment of responsibilities. The weightof the respective voices might differ across countries.2. Maintain close labor market contact: A system of continuous feedbackfrom employers and private-sector institutions allows for adaptation ofthe training content to labor market needs. This element requires a highdegree of employer involvement.3. Ensure high-quality training: Sufficient funding is required to guaranteethe appropriate teaching material and the availability of well-trainedteachers. A decentralized system of quality assurance and local competitionamong training centers, in combination with output-based fundingand licensing, needs to be established.4. Establish qualification frameworks: Centralized accreditation of trainingcurricula creates transparency and promotes acceptance among employers.5. Limit the risk of creating a dead-end vocational schooling track: Thecompetences and qualifications acquired should be comparable andcreditable to academic qualifications to promote transferability betweenthe two and to avoid stigmatization of vocational schooling participants.Formal ApprenticeshipIn some countries, VET is provided through formal apprenticeships, with institutionalinstruction complementing workplace training. This arrangementoccurs primarily in the United Kingdom, the United States, and Australia.The United KingdomIn the 1980s, traditional apprenticeships lost their appeal in the United Kingdombecause of “the recession, the removal of supports and the introductionof cheaper, less-valued alternative training schemes such as theVocatio nal Educatio n And Training In Industrialized Countries 319Youth Training Scheme (YTS) and its successors” (McIntosh 2007: 4). Withthe relative shortage of intermediate (Level 2 and Level 3) vocational skills inthe mid-1990s, however, apprenticeships were reintroduced as ModernApprenticeships at Level 3 and National Traineeships at Level 2. Despite considerablepublic interest in their expansion, the overall participation ratesremained rather low during the early 2000s. Possible explanations for thismodest involvement include 1) the lack of a central and rigorous assessmentof the apprentices’ qualification obtained; 2) the high costs of apprentices toemployers, relative to other countries such as Austria, Germany, or France,among others (Steedman 2010); and 3) a shift toward offering apprenticeshipsto older youths who had previously worked at the company (Wolf 2011).The 2009 reform—the Apprenticeship, Skills, Children and LearningAct—addressed some of these issues, in particular tightening the linkbetween the apprenticeships and employers and offering larger incentivesfor employers to increase training activities. Subsequently, the number ofyouth below the age of 25 who participated in apprenticeships increasedfrom 387,000 in 2007–2008 to about 460,000 in 2011–2012. In 2010, the UKgovernment implemented the Specification of Apprenticeship Standards forEngland (SASE), harmonizing the qualifications of the various apprenticeshipsand increasing transparency in training activities. In addition, theUnited Kingdom offered employers a grant of 2,500 pounds per apprenticeaged 16 to 17 years old. In 2012, they extended the grant to incentivize trainingof those up to 24 years old. Moreover, they started the National Apprenticeshipweek, a yearly public event to draw media attention to the benefits ofoffering and learning in apprenticeships, as well as to increase the acceptanceof apprenticeships. Further government reforms are currently underwayto improve training quality and transferability and to ensure continuousadaption of the qualifications and skills to align with economic demand(Department for Education, Department for Business and Skills 2013).The United States of AmericaIn the United States, formalized apprenticeships have a limited role and arelargely confined to adult education in so-called Registered Apprenticeshipsin the construction industry (e.g., electricians, carpenters, plumbers, andothers). Through the combination of time spent in theoretic instructionand work-based training, the apprenticeship system imparts both generaland occupation-specific knowledge; however, the place of training is concentratedin the firm, as the apprenticeship system operates without anyclose links to formal education.5The Office of Apprenticeship (OA) in the U.S. Department of Labor(DoL) is in charge of the registration and evaluation of VET. Thereby, the5Alternatives to apprenticeships in the United States are specific programs targeting at-risk youth andtraining students for careers in specific sectors, combining high-school classes, training, and work experience(see Holzer 2012 for a thorough review).320 ILR ReviewAdvisory Committee on Apprenticeship (ACA) supports the OA. Across 26states, State Apprenticeship Agencies (SAAs) are responsible for the apprenticeshipprograms, including the provision of technical assistance. Currently,around 21,000 apprenticeship programs are registered in the UnitedStates. Participation numbers from the DoL count approximately 290,000active apprentices in 2012. Since 2008, the number of active apprentices hasbeen steadily decreasing, largely because of a steep decline in the numberof new apprentices. This figure accounts only for apprenticeships notoffered by the military (currently around 70,000) and for those registeredwith the labor office. Lerman (2012) suggested that the actual number oftotal apprentices is higher, given that not all apprenticeships have to be registered.Contrary to the European model, U.S. apprentices are in their midtolate-20s and have most likely already gained some work experience.AustraliaAlthough the majority of VET participation is school-based (80% in 2011), acomprehensive Australian Apprenticeship system also exists. This system differentiatesbetween two types of contracts: apprenticeship contracts and traineeshipcontracts. Apprenticeships refer to technical occupations and the traditionaltrades, whereas traineeships apply to all other occupations (Karmel,Blomberg, and Vnuk 2010). These traineeships are comparable to furtherqualifying training that occurs in other countries because of their short duration(typically less than one year). The contracts are structured in both workbasedlearning with an employer and school-based education with certifiedtraining providers. Contrary to apprenticeships, which have a long traditionin Australia, traineeships were introduced in 1985 to counteract unemploymentof those aged 15 through 19 with low levels of schooling. The participationin apprenticeships and traineeships has significantly increased across allage groups over the past years due to supportive policies, such as financialhiring incentives, part-time training, minimum training wages, and waivedage restrictions (ibid.). Specialized subsidies have encouraged the training ofworkers aged 25 and over as well as mature workers (45 and above); thus, theshare of adults among participants increased to one-third and two-thirds,respectively, of all new entries into apprenticeships (traineeships).Dual SystemIn Austria, Denmark, Germany, and Switzerland, the dual VET accommodatesbetween 40% (Austria) and 80% (Switzerland) of all school leavers.The dual apprenticeship systems in these four countries share the followingfour key institutional elements.1. A high degree of formalization: They provide training in centrally accreditedoccupational qualifications, and the training content is continuouslyadapted to meet the changing labor market requirements.Vocatio nal Educatio n And Training In Industrialized Countries 3212. Strong involvement of social partners: Representative advisory boardsassist in developing and maintaining curricula at the governmental andfederal level. Regional trade or occupational committees, or a combinationof the two, undertake implementation and monitoring.3. Vocational colleges provide the school-based part of dual apprenticeships:Colleges cover both general and occupation-specific education.The government bears the costs of training in the schools.4. Firms must meet certain technical standards: A training firm will notobtain accreditation if standards are not met. Offering apprenticeships isoptional for companies, but those who choose to offer them follow standardapplication procedures to match the firm with trainees. The trainingcompanies cover the training costs within the firm.Why Would Firms Invest in General Training?While dual training exhibits several advantages from societal and individualperspectives, establishing an efficient dual apprenticeship system cruciallydepends on the willingness of firms to participate. To ensure postapprenticeshipskill transferability across firms, the training should providea sufficient amount of general schooling. As Becker (1964) noted, however,in a perfectly competitive labor market, in which workers are paid accordingto their marginal productivity, firms have no incentives to invest in generalschooling because workers could leave directly after the training periodin order to reap all the benefits of their acquired general skills.6 Hence, forfirms to provide both specific and general training, the worker must bearthe general training costs. Implementation would include state-fundedschool-based general education or firm-based general training, along withworkers paying for their training costs. Alternatively, firms could be incentivizedto participate, if they were able to recoup part of their investments bycontractual arrangements ensuring that either 1) apprentices accept a wagelower than their marginal productivity during the training period, or 2)apprentices continue to work for the firm beyond the training period (Malcomson,Maw, and McCormick 2003). In fact, what we see in countries suchas Germany, Switzerland, and Austria is a specific collective agreementreached between unions and employer associations, or wage recommendationsissued by professional associations, setting a generally applied rate forapprentice remuneration. This wage is significantly below the earnings of afull-time low-paid job and thus can be seen as a part-time wage or some basicincome support during the training period.In practice, this model seems to explain firms’ incentives to offer training.In some countries, such as Switzerland, the low level of wages and thestrong involvement of apprentices in the productive activities during the6As discussed below, many firms do invest in their employees’ general training. Some reasons thatexplain this are informational asymmetries regarding workers’ productivity, search costs and market frictions,or monopsony power.322 ILR Reviewapprenticeship allow firms to incur a net benefit during the training period(Lerman 2014). In other countries, such as Germany, some firms are foundto incur a net cost during the training period (Harhoff and Kane 1997;Dionisius et al. 2009).Several theories attempt to find alternative explanations of the trainingactivities of firms (for an excellent overview, see Wolter and Ryan 2011). Inparticular, Acemoglu and Pischke (1998, 1999, 2000) developed andextended the framework of Katz and Ziderman (1990) in which informationalasymmetries regarding the abilities of workers and the quality oftraining received can lead to sufficient incentives for firms to invest in generaltraining. Given that firms are able to learn the ability of the worker duringthe training period, the additional presence of a compressed marketwage allows firms to pay high-ability workers less than their marginal product,hence reaping part of the benefit of training. A compressed wage structuremight arise because of 1) information asymmetries and complementaritybetween ability and training in the production function (Acemoglu andPischke 1998); or 2) search costs combined with market frictions such ascollective bargaining, minimum wages, and firing costs, which are higherfor high-skilled workers (Dustmann and Schönberg 2009). Booth and Zoega(2004) pointed out that wage compression is not a necessary condition forthe emergence of firm-based training, but suggested that all setups resultingin a situation in which training increases the worker’s productivity morethan their wage are expected to stimulate the investment in training. In particular,factors reducing the apprentice’s propensity to quit after the apprenticeshipincrease the willingness to invest in training.Another set of models explores the deterring effect of poaching, a practicein which firms not investing in training might hire apprentices from thetraining firm by offering them higher wages. Hence, firms are more likely toengage in training if they are able to enjoy some monopsony power arisingfrom industry- and occupation-specific skill requirements, dispersed regionallocation of firms, and lower product market competition (Gersbach andSchmutzler 2006; Smits 2007; Lazear 2009). While the incidence and relevanceof poaching is difficult to measure, recent evidence from Germanysuggests that 3% of training firms in Germany are poaching victims. Firmsin bad economic situations that are unable to make counter offers are particularlyaffected (Mohrenweiser, Zwick, and Backes-Gellner 2013).A further potential reason to participate in training might be that firmsprefer to ensure their own future skill supply by providing such trainingthemselves. Some countries, however, such as Switzerland, maintain a largedual system and have a high turnover rate after training (Wolter and Schweri2002). It may be that firms train apprentices to use them in current production,and although firms might incur a net cost for the average productiveapprentice, some high-productivity apprentices might also be paid less thantheir marginal productivity, given that the overall wage level for apprenticestends to be low (Mohrenweiser and Zwick 2009). In particular, if few outsideVocatio nal Educatio n And Training In Industrialized Countries 323options exist for youth, they might be willing to engage in such a paymentscheme since they would benefit afterward from the acquired skills.Why Is the Dual System Not Readily Transferable?The dual VET depends on some essential preconditions. For instance, it relieson strong cooperation between government and employers to develop theVET institutional framework, to design and adjust curricula, to certify competences,and to co-fund the plant-based and school-based elements. In additionto these regulatory and budgetary issues, the dual system depends on sustainedand active support from a sufficiently large number of actors, such as:1. Trade unions must accept that apprenticeship contracts have lower paymentscompared to regular contracts;2. Employers must be willing to provide training (not in an informal mannerbut according to occupational curricula), to send apprentices tovocational school leading to certified occupational qualification, and toprovide them with a credible prospect of sustainable employment;3. Government must provide for vocational schools and teachers and alsofor preparatory training for young people who fail to enter apprenticeships;and4. Youth and parents must accept VET as a solid alternative to academiceducation.These elements tend to be mutually reinforcing. As they have developedover a long time, these conditions cannot be readily transplanted across differentinstitutional and historical contexts. However, many countries havetried to develop dual VET programs. For example, in the United States,both the National Youth Apprenticeship Act under the administration ofGeorge H. W. Bush and the School-to-Work Opportunities Act under PresidentWilliam Clinton were attempts to implement the dual system. Accordingto Lerman and Rauner (2012), however, widespread participation in theyouth apprenticeship could not be reached because of 1) the inability ofemployer organizations to coordinate long-term training plans; 2) the federalistdivision of responsibilities that impedes a binding national frameworkfor the training systems; 3) a general mistrust in the idea of impartingspecific human capital, as it is likely perceived to lose its value more quicklyin a continuously changing labor market (Krueger and Kumar 2004); and4) a lack of employer interest in participating in this exchange. Despite thefutile efforts at the federal level, some states were able to establish and maintaina functioning small-scale dual apprenticeship system, particularly in theconstruction industry (Bilginsoy 2003).Complementary to the previous analysis outlining the incentives of firmsto provide