Institutional Aspects of Youth Employment and Training Policy in Britain
| Published date | 01 November 1990 |
| Date | 01 November 1990 |
| Author | Paul Ryan,David Marsden |
| DOI | http://doi.org/10.1111/j.1467-8543.1990.tb01000.x |
British Journal
of
Industrial Relations
28:3 November 1990 0007-1080 $3.00
I
nstitut iona
I
Aspects
of
Youth
Employment and Training Policy in
Britain
David Marsden" and
Paul
Ryant
Final version accepted
1
May 1990
Public policy towards youth employment and training in Britain during the
past decade has been dominated by two themes: the quest
to
reduce youth
relative pay, as part
of
a wider deregulation of the labour market, in order to
increase access to jobs and training: and the neglect of apprenticeship in
favour of the Youth Training Scheme. This paper analyses these policies in
an institutional framework informed by the results of a recent research
project on youth activity in industry in major EC economies (Marsden and
Ryan 1986,1988,1989,1991).
The policy debate in Britain has tended to focus upon the effectiveness of
lower youth pay at improving youth access to jobs and training (Wells 1983;
Jones 1985; Junankar and Neale 1987). We accept the efficacy of lower
youth pay but question its institutional viability. Youth employment and
training policies must be well grounded in labour market institutions in
order to achieve success. We argue that neglect of the institutional context
accounts for the lopsided and partial success resulting from current policies
in Britain, and that the revitalization of apprenticeship, either as such
or
in
the equivalent form
of
a strongly upgraded public training scheme, has a
great deal to offer.
We begin with an outline of the relevant institutions. We trace their
implications for outcomes in the youth market, contrast the divergent
institutional directions taken by West Germany and the UK, and finally
assess contemporary British policy towards youth activity in general and
apprenticeship in particular.
1.
LABOUR MARKET STRUCTURES
Our primary interests involve youth activity and the structure
of
labour
markets. We start with the distinction between occupational and internal
labour markets. Occupational markets encourage the mobility of qualified
*
London
School
of
Economics.
t
University
of
Cambridge.
352
British Journal
of
Industrial Relations
workers among employers and work best with a system of standardized
vocational qualifications. In the UK examples are readily found among
building crafts and professionals. Internal markets are organized around
particular work-places or employers;
jobs
above entry level are filled by
internal promotion, skills are learned mostly as part of employment, and
qualifications are
of
secondary importance. Examples include production
work in most process industries (e.g. steel, chemicals) and much administra-
tive work, particularly in the public sector. Particular employers often use a
mix of occupational and internal forms
-
e.g. occupational markets for
maintenance jobs and internal markets for production work.’
The relative importance
of
occuptional and internal labour markets
differs substantially by country. Among the four largest
EC
economies, on
which the attention of this paper is focused, the role of internal markets is
more extensive in French and Italian than in West German and British
industry. Evidence
of
national difference emerges in a variety
of
pay and
mobility indicators, such as the growth of pay and occupational status with
age and seniority (Marsden 1990).
Further evidence of national differentiation can be found in methods of
vocational training. Occupational markets typically rely heavily upon
apprenticeship (or equivalent), internal markets upon informal upgrade
training.2 In France and Italy apprenticeship plays a negligible role in
industrial training, being confined mostly to the artisan sector. In West
Germany and the UK apprenticeship has traditionally been widespread in
manual work in industry, though largely confined to males (see Table
1,
col.
A further institutional category is relevant to youth policy: that
of
unstructured labour markets. In the so-called ‘secondary segment’, neither
occupational nor internal forms are significant; pay and skills are usually
low, and youth access to
jobs
is less problematic than in either occupational
or internal markets.
Occupational and internal markets are often presented as opposite ends
of a continuum, but in practice, without a strong institutional support
occupational markets are unstable, and tend to degenerate into internal
markets. According to Becker’s (1964) theory, trainees should normally
bear the cost of training for transferable skills; but it can be shown that there
are good theoretical reasons why this model of training provision should
break down, and in practice employers do bear a considerable part of the net
cost of such training (Marsden 1986: ch.
8).
Under such conditions, skill
shortages commonly lead to employers poaching rather than expanding
training and other types
of
action to bind skilled workers to their
organization, unless there is a suitable institutional framework to control
free-riding behaviour. The importance of this framework leads us to expect
that the two types
of
market, internal and occupational, are discrete types,
and that for any one category of labour one or the other will prevail. Indeed,
the difficulty of establishing and maintaining such frameworks means that
their viability is greater the greater their coverage,
so
one would expect them
3).
To continue reading
Request your trial