The impact of local labour markets on investment in further education: Evidence from the England and Wales youth cohort studies

The paper focuses on the individual's choice of activity on completion of c ompulsory schooling - to remain in, full-time education or to seek employme nt - and the factors influencing this decision. Information from the Englan d and Wales Youth Cohort Studies, coupled with labour market data, is used to estimate of legit model of choice and assess the role played by social a nd market factors. The results show that labour market conditions play an i nfluential role in determining outcomes, particularly in the case of young males with weaker academic qualifications. Consistent with the time-series evidence, we find that participation rates in further education for both ma les and females are positively related to the unemployment rate in the loca l labour market, the effects being greater at times of economic recession w hen unemployment rates are rising. JEL classification: J24, I21.