Safety valve or sinkhole? Vocational schooling in South Africa

IZA Journal of Labor & Development

Table 6 Labor market outcomes and schooling type

	(Log) wages			Employment
	(1)	(2)	(3)	(4)	(5)	(6)
Schooling	0.09			0.05
	(0.01)***			(0.004)***
Academic		0.09			0.05
		(0.01)***			(0.004)***
Vocational		0.10			0.10
		(0.04)**			(0.03)***
Academic secondary			0.08			0.04
			(0.01)***			(0.004)***
Academic post-secondary			0.13			0.11
			(0.03)***			(0.01)***
Vocational secondary			0.06			0.02
			(0.10)			(0.05)
Vocational post-secondary			0.16			0.19
			(0.08)**			(0.05)***
Observations	3,840	3,840	3,840	14,454	14,454	14,454
R-squared	0.27	0.27	0.27	0.21	0.21	0.22
No. individuals	1,676	1,676	1,676	2,811	2,811	2,811
H ₀: academic=vocational		0.69			0.09
H ₀: academic=vocational (secondary)			0.80			0.79
H ₀: academic=vocational (post-secondary)			0.74			0.10
U/O: schooling	3.8			-4.5
U/O: academic		3.9			-4.6
U/O: vocational		1.8			-2.9
U/O: academic secondary			2.7			13.5
U/O: academic post-secondary			-6.2			-1.5
U/O: vocational secondary			0.3			2.1
U/O: vocational post-secondary			-1.3			-2.0

Robust standard errors in parentheses, clustered by individual. *significant at 10%; **significant at 5%; ***significant at 1%. Unit of observation is person-year. Sample restricted to person-years with at least 9 years completed schooling and not currently enrolled. Wages are log of monthly full-time equivalent wages based on 160 hours/month. Wages refer to self-reported earnings on current or most recent jobs held among those not enrolled in school, regardless of current employment status, FTE based on 160 hours worked/month. Employment restricted to periods when not enrolled in school. Excludes person-years corresponding to Wave 5 for which fraudulent fieldwork suspected. All regressions include race, gender, and calendar year dummies; and controls for age-adjusted LNE z-score, experience, experience squared, age, and age squared. Vocational schooling includes NTC and other technical secondary, and universities of technology. Reported test statistics are p-values of indicated null hypothesis. U/O ratio: ratio of selection on unobservables/observables required to explain away effect of schooling variable on outcome, obtained as $\frac{β_{C}}{β_{NC} - β_{C}}$ , where β _C is schooling coefficient from model with included controls and β _{N
C} is schooling coefficient from model without controls. Controls as indicated and described above. See B The sinkhole hypothesis and selection on unobservables for details. Survey weights applied.