The economic disruptions caused by the COVID-19 pandemic had a particularly negative impact on sectors that typically employ many young people. Earlier research suggests that young people adjust their educational choices in response to worsening labor market prospects: During downturns, more students enroll in university studies and choose fields of study with more secure labor market prospects. In contrast, there is little evidence on how economic disruptions affect field-of-study choices at the high school level despite the fact that high-school major choices can have important consequences for future labor market outcomes.
In a recent IZA discussion paper, Aino-Maija Aalto, Dagmar Müller and J. Lucas Tilley analyze whether high school applicants responded to the COVID-19 crisis by adjusting their field-of-study choices. The authors focus on Sweden, where high school applicants choose between different academic (Humanities, Natural Science, etc.) and vocational (Child & Recreation, Hotel & Restaurant, etc.) programs, but similar field-of-study choices are made by the majority of high school students in Europe.
In Sweden, the admission process consists of a preliminary round in which applicants initially rank programs in order of preference and a final round in which they can alter their preliminary rankings. In 2020, the timing of the two rounds happened to provide unique pre- and post-crisis snapshots of the field-of-study choices of high school applicants.
In order to conduct their study, the authors contacted local admission centers and obtained school-level information on the number of top-ranked applications to each specific program for both admission rounds. The self-collected data includes information on field-of-study choices for the years 2016-2020 and covers more than 90% of applicants. By comparing the difference in top-ranked applications between the preliminary and final application rounds with the same difference in previous years, the results are less likely to be caused by other factors besides the pandemic that could affect program choices.
The authors find that the COVID-19 pandemic did not affect demand for academic programs but led to a decline in top-ranked applications to several vocational programs. The declines in demand are most pronounced for several service-oriented programs, in particular those related to the hotel and restaurant sector, which was the most adversely affected industry during the crisis. Demand for these programs decreased by 8% during the first year of the pandemic. This finding suggests that labor market considerations influence the study choices made by relatively young students.