Does ICT affect the demand for vocationally educated workers?

Abstract

This paper examines the effect of information and communication technologies (ICT) on the demand for workers in Switzerland. We compare the hypotheses that an increase in ICT leads to upskilling or job polarization and investigate their implications for countries where vocational education and training (VET) is the most widespread education program at the upper secondary level. Using data from a large employer–employee survey, we create a novel measure of ICT based on the percentage of ICT workers within firms. This measure allows us to assess the impact of ICT on the educational composition of the workforce by exploiting variation over time. We find that ICT has an upskilling effect from 1996 to 2018: ICT decreases the demand for low-skilled workers while increasing the demand for high-skilled workers, especially those with a tertiary vocational education. These results strongly suggest that VET is a valid alternative to a strictly academic education, because workers with a tertiary VET degree are as good, or better, at adjusting to technological change as workers with a tertiary academic education.