‘We don’t need no education’ - Does forcing teenagers to remain in education improve their labour market outcomes in early adulthood?
Exploiting devolution, which limited the policy roll-out to England, and age variation, this paper examines the impact of the raising of the educational leaving age in England which occurred in 2013 and 2015 using an Event Study Design model on labour market outcomes. It identifies a causal impact of the policy with mixed results: the policy improved labour market outcomes unambiguously for young people (those under 27 years old), reducing the incidence of those Not in Education, Employment, or Training (NEET), increasing employment, and cutting unemployment. However, it reduced hourly wages. My findings suggest that the policy was successful in its goals. Educational attendance increased, NEET was reduced, and employment increased for young people. Similarly, the policy had a profound positive impact on continuation to Higher Education. However, increasing compulsory education appears to have cut hourly wages for the treated group, perhaps indicating a diminishing of the signalling power of education or low short-run productivity gains. On balance, this is a powerful illustration of the power of compulsory schooling, suggesting that the other nations of the U.K. and other countries should consider also extending their compulsory education to 18.
Date: 15 May 2023, 13:00 (Monday, 4th week, Trinity 2023)
Venue: Manor Road Building, Manor Road OX1 3UQ
Venue Details: Skills Lab
Speaker: Matthew Oulton (University of Oxford)
Organising department: Department of Economics
Part of: Novel Ideas: MPhil Seminar Series
Booking required?: Not required
Audience: Members of the University only
Editor: Daria Ihnatenko