Labour market outcomes of higher-education dropouts in Germany : how formal vocational qualifications shape education-to-work transitions and occupational status

In Germany, almost 15 per cent of all first-year students leave higher education without obtaining a degree (Tieben 2016). The German post-secondary education system is tracked, however, and many dropouts enter the labour market with additional non-tertiary vocational training certificates. We therefore examine whether higher education dropouts benefit from additional vocational qualifications obtained outside higher education and whether vocational credentials can serve as a ‘safety net’. On the basis of data from the German National Educational Panel Study survey ‘Starting Cohort 6’, this study employs Cox and OLS regression models to analyse the transition to a stable occupation as well as the occupational status of the first stable job. We find that higher education dropouts without formal vocational training certificates have more difficulties finding a stable job compared to applicants with formal vocational qualifications. We therefore conclude that additional vocational training certificates do serve as a safety net in case of drop out, because it prevents protracted pathways to stable occupations. Comparing the occupational status of dropouts with and without additional vocational training certificates, we do not find evidence for additional returns on vocational certificates