Labor market effects of a dual-VET apprenticeship: Evidence from Nepal

This paper analyzes the labor market effects of a Dual-VET Apprenticeship pilot in Nepal. The formal upper secondary education program usually lasts for two years. The program started in the end of 2019. It ended in spring 2022 after being heavily affected by COVID-19. We analyze labor market outcomes in 2023 and 2024 based on structured phone surveys among applicants of the program. We address endogeneity based on randomization of applicants and discontinuity in application test scores. A large share of non-apprentices enrolls in general upper secondary and tertiary education. Hence, our estimations contrast the program to a control group with relatively high educational attainment. OLS results suggest that the program tends to increase work propensity. Due to missing tertiary vocational education in Nepal, the enrollment of non-apprentices in general education further means that the program tends to decrease education propensity according to OLS results. However, these results do not hold in quasi-experimental estimates. • Participants in a dual-VET apprenticeship are satisfied with the program. • Correlational analysis suggests the program increases work propensity. • Participants are less likely to be in further education following the program. • Causal analyses on the program’s impact are inconclusive. • School and workplace closure during the COVID-19 pandemic likely affected outcomes.