The lower number of summer jobs in the private sector this year may result in long-term consequences for youths about to enter the labor market. Summer jobs and part-time jobs in high school constitute an important steppingstone into the labor market for youths having attended vocational programs. In a new study presented by SNS, “Labor Market Contacts and the Transition from School to Work”, economist Dagmar Müller shows that the closure of workplaces where high school students have worked part-time or during summers reduces their chances of obtaining a stable job while also resulting in lower incomes for several years after graduating.
Among youths finding a stable job after they graduate from a high school vocational program, around 30 percent return to the same workplace in which they worked when attending school.
“The fact that companies reemploy summer and part-time workers indicates that this is an important recruitment channel, especially during recessions. That is why it is very troubling that the number of summer jobs dropped significantly this year due to the corona pandemic”, says Dagmar Müller, researcher at the Research Institute of Industrial Economics (IFN).
In order to measure the significance of ties to employers with regard to youths entering and succeeding in the labor market, Dagmar Müller uses workplaces being closed down. Her results show that youths losing a workplace contact as a result of it being closed down are about 2.7 percentage points less likely to find a permanent job immediately after graduating high school, while also having a 13 percent lower income compared to classmates whose workplace was not closed down. These negative effects are more pronounced for youths having lost ties to an employer in an industry matching their vocational training.
“The government should focus on improving the ability of youths to form a relationship with the labor market, especially with workplaces linked to their vocational training. It is particularly important that companies do not hesitate to employ youths with limited work experience. The state can facilitate this by, for example, subsidizing summer jobs in the private sector during recessions, especially in industries employing the largest numbers of youths”, says Dagmar Müller.
About the report
Dagmar Müller studies graduates from high school vocational programs during the period 1986–2016. She follows these youths over time and analyses information regarding their education, income and employer.
Workplaces being closed down do not have anything to do with the abilities or skills of individual youths. This enables Müller to measure the impact of workplaces being closed down on youths’ entry and subsequent outcomes in the labor market.