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This chapter is part of a Melbourne Institute compendium that discusses a range of contemporary issues, with a focus on the economic analysis of important social issues, such as employment, health care and education.

The authors discuss the large equity and efficiency benefits of full employment. Evidence suggests that the full employment level of unemployment, or the non-accelerating inflation rate of unemployment, can now be below 3.4 per cent - as it was for the quarter century to the early 1970s. They question whether the 2022 aggressive tightening of monetary policy places sufficient weight on full employment. They suggest a more balanced blend of fiscal and monetary policy to support sustainable growth in incomes.

Alongside achieving full employment, reform of education and training and the tax and transfer system can increase skills, participation, hours of work and productivity, and lead to a more equitable distribution of income. Investment in child care and early childhood education would increase parents' labour supply, and enhance childhood development and therefore human capital in the long term. Achieving full employment along with such reform would increase real wages, before and after tax, and distribute income more equitably. There is a strong case for sophisticated simulation economic modelling using state-of-the-art tools to strengthen the evidence base for policy design.

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This chapter reviews trends and characteristics of female labour force participation in Asia. It highlights the commonalities as well as the diverse nature of challenges that women across Asia face in gaining access to more and better jobs. Findings show that women across the continent have contributed significantly to its spectacular growth story; yet, social norms and economic factors limit their levels of participation.

Authors' abstract.

The book from which this chapter is taken is available in VOCEDplus at TD/TNC 131.226. Show less

The relationships between higher education and the world of work revived in the late nineties as a major issue of debate in Europe. The world of the professions was confronting with dramatic changes in terms of competences, mainly due to the globalization of the economies, a move towards a knowledge-based society, and technical development. As education providers, the universities were interested in exploring the competence needs of the employers on the labor market. To analyze the way universities prepare the graduates for the requirements of the labor market, in terms of competences and skills, the European Commission funded the REFLEX project, a survey undertaken in 2005 covering working graduates in 13 European countries five years after they had left higher education. Using the data set on 31,800 young European graduates, this chapter looks at the links between higher education and graduate employment, with special emphasis on the transition period from student life to the professional life, the graduates’ views of their preparation for the labor market (competences possessed and required), graduates’ satisfaction with their jobs, earnings, and early career mobility patterns. It also explores the factors influencing the choice of degree course, graduates’ views on their study program (e.g. modes of teaching and learning, and assessment), and what contributes to academic performance.

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In examining the implementation of vocational/apprenticeship training, the authors studied responses to the question: 'How much of the occupational knowledge and skills you acquired during your apprenticeship can you still apply to your current work?' Results showed that relevance declined with the years, the disparity increasing between vocational training and the skills demanded by employers. The authors concluded that the importance of apprenticeship training has decreased with recent technological and economic developments, along with a relative increase in the relevance of on-going training and learning. Some study of earnings was carried out, with conclusions being made that earnings were shown to be enhanced with experience, and in occupations where personal computers were used.

The monograph from which this chapter is taken is indexed at TD/TNC 66.301. Selected chapters are indexed from TD/TNC 66.302 to TD/TNC 66.306. Show less

The dominant paradigm in the economics of education is human capital theory, which suggests that education and training are investments that make individuals genuinely more productive. Individuals who are more productive will, according to this theory, also have higher earnings and be more employable. Policy-makers around the world tend to accept unquestioningly the premise that investment in education and training is a good thing, with most committed to investment in human capital, including vocational education and training (VET), as a means of securing higher economic growth and national prosperity as well as achieving equity goals. However, there is also the view that education does not necessarily make a person more productive it simply acts as an expensive sorting device, to enable employers to identify more able individuals. Understanding the economic value of education and training, as measured by gains in wages, is important but not in itself enough to inform policy about the optimal type of education and training system. It is also crucial that we understand the technology of skill formation over the life cycle. For effective policy formation we need to know how different types of people can effectively acquire skills at different stages of the life cycle as well as the economic returns to those skills once acquired. This is particularly important in the area of VET, since international evidence suggests that the economic returns to some VET is low. The authors argue that effective, or at least informed, policy involves understanding more fully the nature of dynamic complementarities in the acquisition of skills over the life cycle and a better understanding of the differential sensitive periods in the accumulation of cognitive and non-cognitive skills.

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In Germany, it is sometimes difficult to distinguish internships and traineeships from related relationships. A distinction must also be made between different types of internships, especially as different rules may apply. If the internships involve covert employment relationships, the intern is to be classified as an employee. Labour law is also applicable as far as vocational training relationships are concerned. Finally, statutory minimum pay, in principle, also applies to trainees and interns.

Published abstract.

The volume from which this chapter is taken is available in VOCEDplus at TD/TNC 145.301. Show less

The authors investigate whether, in Spain, overeducation is a source of inefficiency in the allocation of resources, or a substitute for specific training. They find that the overeducated are less likely to participate in specific training for the job held. They also find that workers who do take part in such job-specific training elicit higher returns from their formal education. Specific training makes up for the negative pay differential of overeducation in relation to the required level of education for the job held. To a lesser extent, the same happens for undereducation.

The monograph from which this chapter is taken is indexed at TD/TNC 66.301. Selected chapters are indexed from TD/TNC 66.302 to TD/TNC 66.306. Show less

This article is one of a series dealing with issues relating to the development of the supply of, and demand for, qualifications and skills, particularly in relation to initial education and training. The authors draw on relevant research on the European labour market to explore the tendency in most European countries for higher educated people to secure jobs once held by lower skilled people. This tendency is often viewed as evidence that there is an over-supply of higher educated workers who consequently 'bump down' lower educated workers to even lower sections of the labour market. This paper provides an overview of the causes of under-utilisation of higher educated workers and examines the implications for the lower skilled workers formerly employed in these jobs.

The volume of collected papers is indexed at TD/IRD 88.37. Show less

Workers who have lost their jobs due to plant closures or large-scale reorganisation are called displaced workers. These workers are often targeted with specific assistance programs. This chapter discusses and evaluates programs that are used to retrain workers. Displacement and displacement wage losses are defined and analysed. Assistance programs in several countries that have undergone some form of scientific evaluation are presented. The evaluations show that most programs have some positive impact on the employment prospects and income. This is especially true in the longer run.

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'Strengthening Technician Education in India', a World Bank-assisted project in India, provided considerable inputs in capacity expansion, quality and efficiency. It filled major resource gaps towards infrastructure development and established new structures for undertaking activities related to quality improvement. However, its impact on the education system and the suitability of diploma holders passing out from polytechnics to the requirements of their respective work situations was not explored. This paper reports on a tracer study that was carried out to determine the impact on the technician education system as reflected in the employment rate of the graduates on a comparative basis between the earlier and later stages of this project. The objectives of this study were: (1) to ascertain the time taken by the polytechnic graduates before obtaining their first job after graduation; (2) to determine the salary level received by the graduates in their first job; (3) to determine the present status of the teaching-learning process in polytechnics; (4) to determine the possible areas for improvement in the teaching-learning process; and (5) to ascertain the percentage of students pursuing higher studies.

The monograph from which this chapter is taken is indexed at TD/TNC 69.564; individual chapters are indexed from TD/TNC 69.565 to TD/TNC 69.581. Show less