More skilled, better paid: Labour-market returns to postsecondary vocational education

Outside the USA, relatively little is known about the labour-market returns to postsecondary vocational (or polytechnic) education. Yet, polytechnics in Europe are distinct from US community colleges. This paper focuses on the labour-market returns to polytechnic attendance in Finland, where polytechnics are representative of many European countries. Using matching methods and longitudinal administrative data, we find that, compared to individuals with no postsecondary education, students who attend polytechnics have higher annual earnings of e3,300 to e3,700 and employment gains of 2.5 to 6.6 percentage points 10 years after the entry decision. However, the returns vary by personal characteristics and field of study.