Transitions from school to work must be improved for individual youngsters. Switzerland shows the way.
In December 2021, the European Parliament and the Council of the EU, at the suggestion of the president of the European Commission, Ursula von der Leyen, adopted a proposal for a ‘European Year of Youth 2022’. This was to pursue implementation of principle 1 of the European Pillar of Social Rights (‘Everyone has the right to quality and inclusive education, training and lifelong learning’), enhance Europe’s efforts to ensure a fair transition from school to work and add impetus to the creation of high-quality employment opportunities for young people.
A renewed European youth policy is however not in view. Obviously, the war in Ukraine shifted priorities. A more profound ingredient, however, is that the increasing complexity of the transition from school to work is still poorly understood politically and has not yet been adequately researched.
Comparative study
We recently conducted a comparative study on school-to-work transitions across five European countries. Against the backdrop of the gap between the ambitious objectives of European youth policy and its mostly modest achievements, we analysed the complexity of young people’s transitions into working life, scrutinising the experience of the selected countries and formulating proposals on how European youth policy could be rendered more effective.
Transitions occur at various stages in the life-course, including school to work. They come, however, with risks with which individuals in isolation are reluctant to deal. Choice of career is often correspondingly risk-averse and short-sighted.
Many factors determine individuals’ assessment of the advantages and disadvantages of one or other route: tradition (parents and the social environment), peer groups (school), wages (as a material stimulus), social position (perceived status), cognitive abilities and talents. Meanwhile, the interfaces between education, training and the labour market set the type and degree of occupational risk—deciding early on a specific educational track, for instance, will impose greater constraints where permeability is lacking between ‘vocational’ and ‘higher’ education and particular occupations.
These interfaces are product of path dependency—such as apprenticeship versus school-based training—and contemporary governance structures. Should these structures be more centralised or decentralised, more co-operative or competitive, more legalised and bureaucratic or determined by free and flexible agreements between actors on a level playing-field? The theory of transitional labour markets would favour decentralised and co-operative negotiation, with subsidiarity sustained through equalisation of fiscal capacities, matched with central control through high quality standards and monitoring of performance.
Professional sovereignty
Modern theories of justice indicate that these governance structures must be supplemented by a clear overarching aim—the idea of the worker as citizen. From the young person’s perspective, this primarily implies not just being educated or trained for short-term labour-market demands but enjoying sustainable employability over the life-course. Such professional sovereignty not only allows individuals to earn a decent living but is the prerequisite of navigating the digital and green transitions.
Yet many young people in Europe are denied this right to professional sovereignty. In 2021, 13.1 per cent of young people aged 15 to 29 in the European Union (EU-27) were not in education, employment or training (so-called NEETs); young women (14.5 per cent) are more affected than young men (11.8 per cent) and the low-skilled (15.5 per cent) are neglected by training systems. Country differences are considerable: in Greece and Italy, more than a quarter of even the highly qualified young are ‘NEETs’. By 2030, the EU wants to reduce the NEET rate to no more than 9 per cent on average.
What could be the role of European youth labour-market policy in realising this objective? For inspiration, we explored a range of cases, including beyond the EU. In comparing Austria, Denmark, France, Germany and Switzerland, the Swiss education and training system turned out to be the most successful, on several indicators: NEET, level and duration of unemployment, in-work poverty and share of low-skilled youth. Our case study focused on dual learning, combining practice-oriented company training with school-based education—the apprenticeship system.
Swiss success
Three factors turned out to be decisive for the Swiss success. First, Switzerland has kept its apprenticeship system attractive through continual reforms and even managed to upgrade it.
In Germany, by contrast, small and medium enterprises are less and less able to offer suitable apprenticeship places, the share of school-leavers without a certificate remains high and the motivation of young people to enter a dual-learning track is steadily declining. As a result, the proportion of young adults without vocational (or tertiary) qualifications, prone to unemployment, has increased.
Secondly, the autonomy of the 26 cantons in implementing reforms, coupled with co-ordination through multilevel agreements, is decisive for the Swiss success. And, thirdly, strong social partners and professional associations, in combination with strategic leadership from the federal government, set high and up-to-date quality standards.
The Swiss system provides reliable bridges between the multiple institutions of basic, professional and tertiary education and training. Participation in dual vocational education and training, still the norm for most young Swiss, does not carry a social stigma, as tends to be the case in Germany—on the contrary. These governance structures support not only companies’ willingness to train but also their innovation capacity.
Major deficits
At the European level, three initiatives are influencing national school-to-work transitions: the European Qualifications Framework, the European Alliance for Apprentices (including the Erasmus programme), and the European Youth Guarantee. Partial successes can certainly be identified but major deficits are evident. Above all, there is a lack of administrative and sometimes financial capacity for implementation.
How could the EU learn from the experiences of its member states? While governance systems cannot be copied, general principles can be taken up and politics aligned with them in the given institutional context.
The first of these is hybridisation or institutional layering—supplementing established institutions with new elements. For instance, apprenticeship systems can be linked with professional academic education: there are good examples, above all in Switzerland, with its dual universities of applied sciences, but also in Germany, where there are dual study tracks at universities in co-operation with larger enterprises.
A second principle is moral assurance. Every social-insurance system can be abused, so politicians often concentrate only on curbing moral hazard, especially through sanctions. What is often forgotten is the other side of insurance—the incentive to assume risks if security is guaranteed. Young people tend to be risk-averse because they are usually dependent on their parents and have no reserves. Income safeguards, such as universal educational grants in Denmark, allow them to explore wider career and employment opportunities.
Moral assurance also applies to companies. Hiring young people or apprentices is increasingly perceived as risky. Calculable wage subsidies to help finance training, job retention or further training—well developed in Austria—can overcome companies’ risk aversion.
A further principle is flexible implementation—programme development tailored to the individual needs of young people, as well as to local or regional needs and capacities. The youth-guarantee programme in Austria appears to have been particularly successful in this regard.
Strategic role
The EU should act on these principles, taking the overarching idea of dual learning as a guide. For instance, in 2021 Switzerland upgraded its institute for vocational education and training (SFIVET) into a university; in addition to the focus on teacher training, research on vocational training will be intensified. Europe could play a stronger strategic role if it created a European University for Vocational Education and Training.
In addition, Europe could follow the ethos of Swiss co-operative federalism. This would imply focusing on capacity-building (such as optimising the proportion of tertiary or professionally trained teachers for vocational education and training), rather than steering by harmonised targets (such as setting a minimum proportion of young people in tertiary education).
Despite the European Year of Youth 2022, European youth policy has slowed down. This European Year of Skills should be taken as an opportunity to learn from its failures.
Günther Schmid is director emeritus of the Berlin Social Science Research Centre (WZB) and retired professor of political economy at the Free University Berlin.
Janine Leschke is professor with responsibility for comparative labour-market analysis at the Department of Management, Society and Communication in Copenhagen Business School. She is editor of the Journal of European Social Policy and Danish lead partner of the Horizon 2020 project HECAT—Disruptive Technologies Supporting Labour Market Decision Making.
Bernard Gazier is professor emeritus of economics at l'Université Paris 1 Panthéon-Sorbonne. He specialised in labour economics and mainly works on the analysis and politics of transitions in and around the labour market.
Lutz Bellmann is a professor at Nikolaus-Copernicus-University Toruń, a former Head of the Institut fur Arbeitsmarkt- Und Berufsforschung research department 'Establishments and Employment', and a professor of labour economics at the University of Erlangen-Nuremberg.