Abour Outcomes Of Tvet In Ethiopia Economics Essay

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The education and training policies of the Ethiopia rests on a simplified presumption that to produce more skilled credentials is the same as to produce more human capital. This policy rhetoric is saying that increasing human capital serves individuals and societies as a straight route to economic development, since the production system of the country is labour-intensive. The driving goal of the national TEVT strategy of Ethiopia (2008) is to strengthen the culture of self-employment and support job creation in the economy through the expansion TVET. Regardless of this, the Urban Employment Unemployment Survey (UEUS) shows that TEVT graduates become government wage employees. Therefore, in this paper, I concentrate on analysing the gap between the human capital ideologies characterized in the current labour market rhetoric and the everyday realities of human capital risk faced by TVET graduates in their self-employment endeavours. I discuss various factors such as socio-cultural, support service mechanisms, personality traits and government actions and policies which affect TVET graduates undertakings in self-employment.


Technical and Vocational education and Training (TVET), Self-Employment, Ethiopia

Chapter 1: Introduction

1.1 Background of the Study and Indication of the Research Problem

The poverty-reducing effect of growth is dampened particularly if growth is concentrated in sectors that have low employment potentials, and where workers lack the skills to take advantage of the opportunities offered by growth (ILO, 2007). Above all, women and the youth are the primary fatalities of unemployment, among others, due to lack of skills (Tegegn, 2011). Incidentally education and training is believed to have desirable effect on the employability of individuals and on their access to gainful jobs.

Expansion of education and training is among the active labour market policies (ALMP) that governments adopt to enhance the endowments of the poor and their entitlements. In view of this, Technical and Vocational Education and Training (TVET) programme is vital in furnishing skills required to improve access to employment opportunities, improve productivity, and raise income levels. UNESCO -UNEVOC, the international centre for TVET, in their framework of "what is TVET?" indicated that: "TVET is concerned with the acquisition of knowledge and skills for the world of work" (UNESCO 2010:1).

The Ethiopian development strategy of five years, Plan for accelerated and sustained development to end poverty (PASDEP) (2005/06- 2009/10) was prepared based on MDG targets and the government's vision for Ethiopia's development. Incidentally, resource was largely directed to main concern sectors such as: education and training, health, and infrastructure (MoFED 2006). The current development strategy, the Growth and Transformation Plan (GTP) (2010/11- 2014/2015) centres on job creating economic activities and achieving even-handed social development (MoFED 2010).

The driving goal of the national TEVT strategy of Ethiopia (2008) is to strengthen the culture of self-employment and support job creation in the economy (MoE 20008). The strategy pressures the necessity for creating one coherent, outcome-based TVET system which includes formal, non-formal, informal, initial and further training for all sectors [1] . Due to this vital intention of the TVET strategy, at present TVET institutions are increasing even more and more from time to time. Ethiopia has increased the number of TVET institutions from 153 in 2003 to 505 in 2011 [2] .

Table 1.

Number of Schools

No Of Schools









AAG, 2003-2010 %











Primary education(1-8)










Secondary education(9-12)




















Higher education










Source: MoE, Education Statistics Annual Abstract, 2010/2011

As mentioned in Education Sector Development Plan IV [3] (ESDP) IV, the foremost aim of TVET sub sector is to train middle level human power by doing so to contribute to the vision of the country to become a middle income country in the year 2025. General secondary education (Grades 9-10) has expanded at over 4.5 % per year on average for the past five years [4] . Therefore, there has been increased demand for secondary places at the next level. To meet these demands as can be seen in Table 1.1 TVET Institutions have increased in number.

Table 1.

TVET Enrolment Trends by Gender







AAG 2003-2010 %






















% Female







Source: MoE, Education Statistics Annual Abstract, 2010/2011

Evidence on TVET enrolment in both government and non-government ownership can be seen in Table 1.2. The total enrolment in TVET in the year 2007 was only 191,151. In 2011, enrolment has amplified to 371,347. In the year 2011, female enrolment comprised of 46.2% of total enrolment, indicating a relatively good gender balance at the national level but it can be seen that the gender gap is not consistent.

After having acquired the necessary skills, TEVT graduates career options are either wage employment or self-employment, in which both are vital that the former is to supply the industry with skilled labour and the latter is job creation. Consequently, as per the national TVET strategy (2008), self-employment is considered as a major career choice for TVET graduates. In view of this, The PASDEP assumed the TVET programme to offer "…relevant and demand driven training that corresponds to the needs of economic and social sectors for self-employment" (MoE, 2008:8). This option is obviously achieved through Micro and Small Enterprises (MSE) endeavours, which is considered to be the basis for economic development and betterment of livelihood of citizens.

With the intention of making TVET graduates self-employed, the number of TVET schools as well enrolled trainees is increasing considerably in number. However, TVET graduates become wage employees rather than self-employed (UEUS [5] ). Furthermore, they are frequently incapable of engaging in self-employment or locating employment. Besides, they are often not primed with the expertise and the most of all the knowhow, capital and material fundamentals to establish their own businesses (Biazen and Amha 2009). Thus, they are not able to contribute considerably to poverty alleviation by creating jobs and engaging in small productive businesses. Numerous reports also indicate that TEVT teachers lack practical skills, consequently, they graduate incompetent youths who do not suit the demands of the works in industries and services vicinity (Mesfin 2004).

Kibru (2012) argues that the available data do not allow carrying out any full-fledged impact assessment to analyse the possible effect of TEVT on employment in Ethiopia. In addition, "Studies, documentation and data made on TVET programme are almost inexistent in Ethiopia and whatever data, documentation, research and evaluation outputs exist, it appears to be neglected" (Biazen and Amha 2009:34). The heightened lack of TVET- related research was also documented as one of the strategic issues in the national TVET strategy (MoE 2008). The MoE (2006) stated "TVET development is currently hampered by a serious lack of relevant data and information about TVET issues […] necessary to inform planning, monitoring and evaluation in the TVET system […]. Research capacities within Ethiopia are rather underdeveloped. In order to become self-reliant in the long run, high quality domestic TVET research capacities needs to be built." (MoE 2006:35).

1.2 Existing School to Work Transition Service in Ethiopia

Public employment services are provided by the Ministry of Labour and Social affairs (MoLSA) and its regional branches of Bureau of Labour and Social Affairs (BoLSA). Through these offices fitting graduates are positioned in open public sector places in urban areas. Graduates of government operated TVET programmes which centre on agriculture and health extension services are deployed as extension workers or government development agents in the rural areas with the related government bureaus and offices of the ministries for example the Ministry of Health (MoH) and the Ministry of Rural Development and Agriculture (MoRDA) upon graduation.

Through Micro and Small Enterprise (MSE) development Offices, TVET graduates trained on construction areas are assisted to engage in self-employment ventures, such as building construction, material supply, sub-contracting for installation of electrical and plumbing systems in government initiated condominium housing development projects in major urban centres. The non-agriculture non-health TVET graduates, private sector employment recruitment is made through newspaper ads, vacancy announcements on notice boards and word-of-mouth referrals from family and friends depending on one's networking abilities. Employment seeking candidates also go door to door to inquire about employment opportunity or to submit their CV's to potential employers for future considerations.

According to Biazen and Amha (2009) considerable number of the skilled labour force is facing problems of unemployment due to lack of employment opportunity (Biazen and Amha 2009). The same authors note that apprenticeship is said to be not as effective as desired, industries, production units and offices are not committed in providing apprentice services to trainees (Biazen and Amha 2009). School to work transition is suave only in conditions where the government trains student for particular job opportunities such as construction and electricity by which they get hired by the government. In other cases it is left for the student to find employment in the labour market. Nevertheless, most students lack knowledge of where to go and apply. In this regard, the problem could be alleviated by providing counselling services (Biazen and Amha 2009).

1.3 Access to Credit Facilities: Case of Addis Ababa City

The credit provision service for TVET graduates in Addis Ababa is conducted by the Addis Ababa Credit and Savings Institution located in every Woreda of every Kifle Ketema in Addis Ababa city. The service provides loans under certain conditionality's. For any person to be eligible to get a loan, an individual has to be at least eighteen years old, be a permanent occupant of Addis Ababa and respective Kilfle Ketema and Woreda. An individual has to arrange for collateral in the form of either, personal or material guarantee. For loans to business enterprises, cooperatives or such as share companies, it is indispensable to have a legal registration with legitimate license. The loan size differs between Birr 500 and 100,000 BIRR and the loan must be paid back within 1-12 months. The interest rate ranges between 13 and 18%, conditional on the time of settlement. There is a grace period of 4 months for the credit. Credit clients are supposed to make a deposit of 20% of the request loan at the lending body for loan protection. Additionally, upon registering each of the enterprises are obligated to open a bank account with a least of Birr 1,000 deposit.

1.4 Research Questions

This research paper will analyse and evaluate what the TVET programme graduates are currently engaged in? Why they are engaged in what they are engaged in? And what the determinants are for the TVET graduates to be in productive self- employment as per the expectation of the programme. To have a detailed look in to the subject matter, the main research questions will be:

Why are TVET graduates not in productive self- employment?

In what forms of employment are TVET graduates actually engaged in?

Do TVET graduates have different employment profiles than university graduates and school 'drop-outs'?

Does the TVET programme need improvement in order to succeed in engaging its graduates to be involved in productive (self)-employment? Is self-employment a real option?

Objectives of the Research

The overall objective of this study is to describe and identify the performances, problems, strengths, weaknesses, opportunities and threats, lessons learned and options for the coordinated productive self-employment of TEVT graduates and TVET programme improvement in Ethiopia. The objectives of the study are the following:

Review and evaluate in retrospective the experience of TVET programme in Ethiopia in terms of processes adopted and policy and practical challenges confronted at Macro level;

Analyse the employment status of the TVET graduates;

Examine the prospects of TVET graduates in the labour market;

Identify factors influencing TVET graduates in involving in productive self-employment;

Assess the adequacy of the support services contribution to the TVET graduates self-employment decisions;

Reveal government policies, strategies and actions towards TVET graduates' self-employment;

Analyse personal traits and socio-cultural factors affecting TEVT graduates self-employment.

1.6 Policy Relevance of the Research

At the moment, Ethiopia is using TVET as one of the major development strategies; however, despite the increase in participants, these graduates appear not to be in a position to create their own enterprises and/or getting employment in private sector companies/industries (UEUS [6] ). These failure stems from a number of factors, so researching this factor is very essential in order to fill in any policy gaps with this regard.

1.7 Limitations

The qualitative research data collection methodology, in particular the choice of the small sample population through purposive sampling method, are considered as the main source of limitation for generalizing the results of the research to all TVET graduates population in the country. The inherent weakness associated with this method cannot be assumed as limitation free. Henceforth, cautions were made whenever extrapolation of the findings from the sample to all of the TVET graduates population was sought. All the responses of the interviews and discussions, though subjective in nature, are taken to be the representations of the actual scenario. The limitation of semi-structured interview may be considered in terms of whether the data obtained reflect the actual facts grounded in the day to day practices. The limitations that are discussed may influence the validity of the research in terms of the ability to generalize the results to the entire TVET graduates population.

Moreover, it was considered more important to take the perspectives of the TVET graduates themselves in describing and critically reflecting their own experiences. Such a choice entails that the perspectives of other important actors such as TVET institute heads, private employers, MSE personnel, TEVT government officials, policy makers and others may not be equally considered or represented in the data. In particular, this condition may impact on the results of the research, particularly if there are contrasting and differing perspectives.

All interviewed TVET graduates were from government TVET schools from Addis Ababa. TVET Graduates from the private schools and in other skill development centres were not included in the research. These choices and decisions of inclusions and exclusions were made in an effort to focus the research and limit its scope and allow a degree of feasibility to data collection and analysis. Thus these boundaries set in this research indicate its limitation.

: Conceptual and Theoretical Framework

2.1 Overall Understanding of TEVT

Vocational education and training are in all probability as old as humanity (Maclean and Wilson 2009). Currently, UNESCO estimates that some 80% of occupations are based on the application of technical and vocational skills to the world of work (UNESCO-UNEVOC & UNESCO-UIS, 2006).

TVET is a comprehensive term referring to the educational process, which involves, in addition to general education, the study of technologies and related sciences and the acquisition of practical skills and knowledge relating to an occupation in various sectors of economic and social life (UNESCO, 1984). It is the major link connecting the school system and the employment market, which means that developments in TVET are intimately linked to general trends in the economy (UNESCO, 1990).

The term TVET has changed all through history, typically in reaction to the demands made by the societies it serves (Maclean and Wilson 2009). The term "TVET" was adopted by UNESCO and ILO at the second International Congress on TVET, held in the Republic of Korea, Seoul in 1999(Maclean and Wilson 2008). Kingombe (2012) notes that term TVET was adopted by UNESCO and ILO in consultation with their member states and partner agencies to mean:

"Those facets of the educational and training procedures involving the study of technologies and related sciences, and the acquisition of practical skills, attitudes, understanding and knowledge in various sectors of economic and social life" (UNESCO,1999 as cited by Kingombe 2012).

Maclean and Wilson (2009) argue that the present term-TVET-necessitates both explanation and differentiation from other terms (Maclean and Wilson 2009). Over time, a string of terms have been used to elucidate elements of the field that now makes up the term TVET. To mention a few: occupational education (OE), vocational education and training (VET), technical education, TVE career and technical education (CTE), (Maclean and Wilson 2009). A number of these terms are commonly used in specific geographical areas. For instance, in Europe the term vocational education and training (VET) is in common usage, while in the United States the current term is career and technical education (CTE). In addition, many in the field are advocating the use of continuing vocational education and training (CVET). There are also several different dimensions that can be used to define vocational education and training-for example: its venue (company-based, apprenticeship, school-based), and character (initial, continuing).

Many Authors argue that, TVET by design is planned to build up skills that can be used in a specific occupation or job. These same authors argue that the objectives and content of TEVT curricula is derived from analysis of the tasks that are to be carried out on the job. The effectiveness of these curricula can be measured by the extent to which trained persons can use their skills in employment. (Middleton, Ziderman, V. Adams 1993). Maclean and Wilson (2009) define TVET as the acquirement of education and skilfulness for the world of work to raise prospects for productive work and personal empowerment and socio-economic development for sustainable livelihoods in the speedily changing work milieu.

2.2 The Human Capital Theory

Economists like Becker (1993) defined the relation between the individuals' abilities, education, training, and the outcomes obtained in the labour market, in terms of wages and employment (Becker, 1993). Individuals or governments invest resources in education or training up to the point where the profit or gain of the last Birr invested in human capital is greater than the profit or gain that would have been invested in any other markets (Becker 1964). Furthermore, human capital theorists argue extensively that any resources voluntarily committed for enhancement of human capital have a definite productivity aspect (such as McMahon 1999). The view of these theorists has been that schooling or training elevates labour productivity through its function in increasing the abilities of workers. The outlook that elevated labour productivity is a positive function of the amount of schooling or training obtained is the main premise of human capital theory (Colcough 1982).

Nevertheless, economists like Spence (1973), have argued that those who are more able and productive also have a tendency to invest in more education. In other words, education does not inevitably make you more productive it basically is an expensive sorting scheme, to support employers to recognize more able individuals. Wolf (2002) points out that the policy emphasis on education and skills as the main driver of economic growth exaggerates the significance of human capital investments and that a major function of education is as a sorting tool (Wolf 2002). It is clearly vital to understand these potential economic returns to education and training to the individual, firms, and the wider economy. Even so, we must also distinguish that separating out the genuine impact of education on productivity and earnings from its task as a sorting tool is very challenging (Carneiro 2010). According to Worthington and Juntunen (1997), Human capital theory also emphasizes that human capital is developed differently between different individuals due to distinctiveness of an individual's characteristics such as:

Inherent cognitive skills;

Practical skills and norms and values;

Differences in the surroundings;

Differences in the capacity to benefit from in the investment in human capital;

Parental background and many other reasons.

Impact analysis of the returns to human capital requires common and sometimes complex econometric analysis of education/training-labour market linkages (Fasih 2008). For an all-inclusive representation of human capital-labour outcome linkages, the supply-side analysis needs to be harmonized with demand side analysis (Kingombe 2012). The provision of adequate jobs for the labour force is a vital issue for any policy maker, not simply an adequate number of jobs for the workforce, but also whether these jobs are of good quality and/or whether self-employment is an option in the economy. As to the demand side, it should include policy issues related to the curriculums and programme structure, other than policy issues that affect the operation of labour outcomes for example the mismatch of skills and trainings in labour markets. Literature on the rate of returns to human capital in developing countries evaluates the returns to vocational in comparison to academic education (Psacharopoulos 1994, Bennell, 1996) or tries to classify the impact of completing heterogeneity in schooling and impact on earnings (Appleton 2001). This permits one to build conclusions regarding the strength, span, and rate of return on post school investments across occupational paths (Freeman and Hirsch 2002).

2.3 The Concept of Self-employment

Self-employment has been defined by different authors to mean different concepts. Startiene et al (2010) points out that, researchers and various institutions provide a wide-range of self-employment concept understandings (Startiene et al 2010). Spencer and Gomez (2004) defined self-employment as the simplest type of entrepreneurship since self-employment seldom necessitate substantial financial investments, advanced management skills or understanding of the legal scheme for setting up or operating a businesses (Spencer and Gomez 2004). Zimmermann (2004) argues that self-employment is effective, but risky form of entrepreneurship, providing individuals a sense of higher self-independence and more satisfying lives (Zimmermann 2004). Zhang et al (2006) explained self-employment as proprietors of enterprises, employing numerous persons (Zhang et al 2006). S. Parker (2004) considers the self-employed as persons who earn no wage or salary nonetheless derive their income by exercising their occupation or business on their own account and at risk (S. Parker 2004).

Numerous researchers (such as Blanchflower and Meyer, 1994; Burke, Fitzroy, and Nolan, 2002) in their studies consider "self-employment" and "entrepreneurship" as synonyms. Even though several researchers (like Bradley and Robert, 2004; Stel, Carree and Thurik, 2005) beg to differ by arguing that self-employment cannot reflect the actual level of entrepreneurship in a country. However, Startiene (2010) argues that the entrenched attitude in society about the links between these two phenomena allows them to be synonymous (Startiene et al 2010). Consequently, from reviewing literatures, this research finds that there is no general scientific consensus on the concept difference of self-employment and entrepreneurship. Summing up, based on this literature analysis in relation to the endeavours of TVET graduates, entrepreneurship, self-employment, job creation and MSE undertaking are taken as analogous ideas although they are not exactly the same in other contexts. Accordingly, the terms self-employment are used all the way through this research paper in association with any self-employment ventures (be it MSE, individual or cooperative ventures.

2.4 Economic Models of Self-Employment

There are very few economic theories in the literature exclusively dealing with self-employment (Startiene et al 2010). Apparently the reason being, economic theories that examine self-employment and entrepreneurship often correspond and complement each other (S. Balkan, 1989). Pioneer economic entrepreneurship theorist Mark C. Casson first recognized the absence of economic theory of self-employment. He developed his modern economic theory of self-employment through a mixture of the thoughts from Joseph Schumpeter, Frank Knight, and Friedrich Hayek (Startiene et al 2010). His research led him to conclude that culture and institutions influence the performance of an individual's self-employment. However his model did not sufficiently explain the subject matter of why people choose to become or do not choose to become self-employed. Later on, Baumol (1990) pointed out that self-employment depended heavily on the incentive structure in the economy (Baumol 1990). Baumol (1990) argued that individuals choose to be self-employed when their utility from power, wealth and prestige is maximized (Baumol 1990).

One of the early self-employment economic theories is the occupational choice theory. Studies of occupational choice theory largely focus on the neoclassical theory of human capital, (which is well discussed in the next section) i.e. individuals are more likely to decide on a vocation that offers the maximum possible earnings in the future value (Becker 1964). Eisenhauer (1995) constructs self-employment economic model based on the expected utility gained, dependent on utility derived from the working environments of the employment contrasted with self-employment alternatives (Eisenhauer 1995). Douglas and Shepherd (2000), argue that the choice to be in self-employed may be modelled as a utility-maximizing career choice made by an individual. That is, people prefer to be self-employed if the full utility they expect to get, be it income, independence, risk bearing, work effort, and privileges linked with self-employment is greater than the anticipated utility from their best employment option (Douglas and Shepherd 2000).

Douglas and Shepard (2000) differentiate between entrepreneurial attitudes and abilities, and link an individual's income potential to these abilities and attitudes (Douglas and Shepard et al 2002). They examine individual's attitudes to work effort required, risk, and decision-making independence. Accordingly, the authors developed a theory of self-employment that explains an individual's choice to be self-employed, or to be a hired employee, by using a utility-maximization model of human behaviour in that individuals will choose the career option that seems to assure the greatest expected utility. They consider three main attitudes which one might expect to vary between those intending to be self-employed and those intending to be hired employees. These attitudes are those toward hard work effort, economic risk, and decision-making control. From this one can hypothesize and investigate the extent and depth of how personality attitudes influence TVET graduates career choice.

Economic theories dealing with career choices mostly distinguish earnings as the main motivation, yet, the question arises is why people choose to become hired employees, if self-employment offers higher earning? This question might be explained by the group of theorists, "push" and "pull" theory of self-employment. This group of theorists treat self-employment as an alternative to avoid unemployment. The group of "pull" self-employment theories treat self-employment as the desire to earn the income by realizing own ideas (Startiene et al 2010). This theory argues that the reasons for a livelihood choice are determined by external uncontrollable forces from the outside such as unemployment and the workplace conditions.

The "push" school theory assumes that unemployment rate decreases the opportunities for hired employment as well as the expected income from hired employment, thus "pushing" the person into self-employment (Startiene et al 2010). Forced by these situations, a person chooses self-employment as an alternative to get away from unemployment. Pull school theorists, Ritsilä, and Tervo (2002) argued in their study that self-employment is not the individual's vision, but a better choice than the undesirable condition of the labour market. Accordingly, they found that, people voluntarily become self-employed, if a country's economic and business conditions allows it (Ritsilä, and Tervo 2002), consequently reducing the unemployment rate. Their findings imply that individuals incline to become self-employed when the unemployment rate is low.

2.5 Various Approaches on Factors Influencing Self-Employment

There are diverse approaches and theories to analysing the factors affecting self-employment efforts of individuals. Lambing and Kuehl (2000) have pointed out personality traits, socio-cultural factors, economic conditions and the combination of these factors as the major issues influencing self-employment. Other authors like Saini and Rathore (2002) argue that social, religious, socio-cultural, psychological, political and economic policies as the main factors affecting self-employment. Another approach to the factors affecting self-employment is described by Khanka (2004). These factors are economic aspect, noneconomic aspects and government measures.

The economic aspects comprise of capital, inputs and the market;

The non-economic factors are the social and political circumstances such as social mobility, security and psychological factors

The Government measures and actions comprise issues such as economic and industrial policies and strategies which influence both the above factors.

There are countless approaches to analysing the factors affecting self-employments, nevertheless the in one way or another, it seems they are all saying the same thing in different words. Regardless of their dissimilarity of treating the individual factors, they are harmonizing to each other. So much so that the major factors affecting self-employment schemes can be classified into various aspects such as support system factors, personal traits, government policies, and socio-cultural factors which is elaborated thoroughly below.

2.5.1 Personality Trait Factors

These are a set of aspects related to an individual's personality either inborn or learned which determine an individual's vocation. Lambing and Kuehl (2000) argue that the self-employed have an innate unique personality which cannot be taught. This implies that the personality of self-employed is inborn and learning has an insignificant influence in becoming self-employed. In the reverse, many authors like Drucker (1999) argue that socio-cultural influences considered as learned traits are sources of self-employment personality (Drucker 1999 as cited in Lambing and Kuehl, 2000:15). Kirzner (1998) points out that any one has the ability to be self-employed and that they function within set constraints (Kirzner 1998 as cited in Deakins, 1999:11). Nevertheless, still many others accept that both nature and nurture equally add to an individual's self-employment attitude. Consequently, in this research paper, i prefer to have the stand with the third group believing both factors have their own share of contribution to self-employment. Lambing and Kuehl (2000) argue that, whether self-employment tendencies are inborn or developed as the person matures, certain personality traits are usually evident in those who attain success.

2.5.2 Socio-Cultural Factors

These set of factors centre on such aspects as values, norms, and family and community entrepreneurial traditions. Lambing and Kuehl (2000), point out that, some culture's encourage self-employment, while others discourage it. In some cultures, self-employment is conceived as an occupation for low self-esteemed persons. For instance, it is well described in Lelissa (2006) and UNESCO(2002:132) that the negative social image held on the TVET programme discourages self-employment ideas of TVET graduates. Young ( Young as cited Batra, 2003:26) points out that entrepreneurial activity is generated by a particular family background and experience. In respect to this, Saini and Rathore (2001:5-6) described that entrepreneurial traditions of the family as well as the community are important factors within which the entrepreneur grows and internalizes the values and norms. With regards to societal attitudes, the TVET program itself is victim of negative image held by the society in Ethiopia. According to a research finding Lelissa (2006), argues that trainees of TVET institutions are considered as low achievers or failures from grade ten national exam. This image of the society at large and the view of the graduates in particular are a barrier to the development of their vocational career in general and of becoming self-employed in particular.

2.5.3 Government Policies and Actions

Government policies and actions are the economic and political environment which includes various factors that affect the would-be self-employed. Among the economic factors lack of capital, working place, facilities and the market are at the forefront. The issue of start-up capital and inadequate provision of micro-credit services are therefore central to the TVET graduates to start new MSE. Hence, government economic policies which encourage self-employment by providing credits, working shades, technical assistance (consulting personnel) are some to mention few.

2.5.4 Support System Services

Factors related to available support services the quality of training institutions, financial and credit institutions, self-employment personnel support, consultancy services. These support services have their share to the success of TVET graduates in venture creation efforts. Some scholars argue that entrepreneurs are born and support services are less important. However, it is proved that with the right type of training, follow up support and assistance, one can become self-employed (Batra, 2003). It is clear that unidentified potentials can be cultivated and developed through well envisaged and integrated training including entrepreneurial skills. From this we understand that the type and quality of training offered in a TVET institution is imperative for the TVET graduates' self-employment. Institutions giving entrepreneurship and innovation trainings tend to develop self-employment and an entrepreneurial environment (Hisrich and Peters, 2002). This shows that the institution's capability to furnish the trainees with the necessary skills, knowledge and attitude paves for self-employment realization.

Encouragement to self-employment can significantly influence individuals to regard self-employment as an advantageous and viable career path (Hisrich & Peters, 2002:13). In addition to the trainers role in engaging their trainee's in self-employment, career guidance and counselling support is also another contributing factor. Hiebert and Borgen (2002) argue thatt guidance and counselling services are essential for the goals of TVET to be fully realized and that they should for that reason be fully integrated with all TVET programming.

Another aspect of training setting influencing self-employment is work experience. Work experience may be expressed in terms of any kind of exposure to a business environment apprenticeship or wage employment for a specific period of time. Some graduates choose wage employment because they attain experiences without incurring cost. In this respect, a research finding (Lambing & Kuehl, 2000) in a survey on source of business ideas of 500 successful entrepreneurs revealed that nearly half (43%) of the respondents said they got the idea for their business from the work experience they gained while working for wage in the same industry or profession. Hence, it is clear that work integrated training methods such as apprenticeship, cooperative training and free practice programs are imperative.

2.6 Brief Assessment of Labour Outcomes of Training Programmes

The Organization for Economic Cooperation and Development (OECD) review by Martin (2000) evaluates what works and what does not on job training programmes. The past performance of many ALMP's such as TVET is mixed in terms of raising the future employment and earnings prospects of job seekers and producing benefits to society (Kingombe 2012). As the OECD jobs study has stressed, more effective active policies are only one element in a comprehensive strategy of macroeconomic and microeconomic measures indispensable to cut unemployment considerably. However, they continue to be a potentially important weapon in the fight against unemployment (Martin 2000).

Martin (2000) argues that, many programmes, which have been evaluated thoroughly , have a tendency to be small-scale programmes such as demonstration programmes. Although the evaluation literature tells a lot about what works, it is not very informative and clarifying in answering supplementary equally vital questions, such as why do certain programmes work for some groups and not for others, and in what circumstances? For example, do skill-enhancing activities work best when they are be combined with personal counselling, job search assistance in order to work? He points out that, the proof is just not there.

In abstract, Martin's (2000) assessment of the evaluation research stresses on major principles which could guide and screen the selection of ALMPs in order for it to be effectiveness. One key principle is of keeping public training programmes small in scale and well-targeted to the specific needs of both job seekers and local employers. Martin (2000) also found it vital that more countries should begin to evaluate their labour market thoroughly for setting the appropriate scale of programmes systematically. Kingombe (2012) notes that indeed, evaluation should be built into the design of job training programmes at the beginning rather than being viewed as an ex-post exercise.

Betcherman, Olivas et al (2004) argue that countries with informal labour markets and weaker capacity to implement programmes may hinder what some job training programmes can attain in terms of generating formal employment or raising income of this programme participants. The few evaluations made on employment services and job training programmes in countries with low-income larger informal labour markets than the OECD is found to be less positive than the (much larger) body of evidence in the OECD and transition countries (Kingombe 2012). In contrast, some youth training programmes in developing countries have much more encouraging impacts than are observed in OECD countries (Kingombe 2012). It may be that such programmes in these low-income labour markets counties have more potential for formal employment or increasing wages since ample supplies of skilled workers are not accessible (Betcherman, Olivas et al. 2004).

2.7 Brief Assessment of Studies Linking Productivity with TVET

The purpose of TVET is to make people self-employed and to be a vehicle of transition from school to the world of work (Hollander and Naing Yee Mar 2009). With regards to this argument, TVET is time and again considered as a device for poverty mitigation as well as towards sustainable development through self-employment endeavours. Whilst this argument appears to be a rational one, For TVET to actually have an impact on poverty other aspects have to be in place. Moreover, For TVET graduates to efficiently be involved in productive self-employment there needs to be a labour market which can absorb the TVET graduates and provide them with productive work and an income that allows them to survive.

According to studies and researches done by international agencies, productivity employment is regarded as the linkage between economic growth and poverty reduction; the quantity and quality of employment determines how growth of an economy translates into higher incomes and hence poverty reduction. International agencies such as World Bank and the ILO indicated that productive employment might be the main pathway out of poverty and the type of work that individuals can access is critical. TVET links skill development policies to employment needs and labour market requirements, especially because the majority of new work opportunities are increasingly found in productive self-employment and work in the informal economy rather than in formal employment (UNICEF-WBI, 2008).

The quantity and nature of TVET varies widely across countries, and this is not necessarily linked to a country's state of economic development (Kingombe 2012). For instance, MartÍnez, Levie et al. (2010) argues that the impact of such training does vary according to the level of economic development. The same author's claim that the greatest impact of TVET is major in countries which are on early-stage of entrepreneurial activity with favourable institutional contexts. TVET appears to be mainly successful in countries such as Belgium, France, Germany and the UK in western Europe which have low rates of early-stage entrepreneurial activity. But in countries like Republic of Korea and Japan which have institutional barriers, as well as cultural perceptions, may also prevent the gains in awareness and attitudes from interpreting into purpose and action . They further argue that argues that if the basic level of self-employment conditions are not sufficient, factor-driven countries should not invest in large-scale training programmes. An alternative explanation for this argument is that less-developed economies have lower quality forms of training, consequently low level of demand for the resulting limited skills (ibid).

2.8 Pinpointed Challenges and Pitfalls of the TVET System

According to Sandhaas and Winkler (2011) "… the challenges and pitfalls of any TVET system is, the constant presence of mismatch between supply and demand for manpower necessities by which "unemployment is an indicator". According to Winkler (2008), who made a multi-country study of TEVT reforms for ILO, classified countries, from all parts of the world who have made TVET a major developmental approach, into three groups by their labour market characteristics: which is listed below (Winkler 2008, as cited in Sandhaas and Winkler 2011)

high labour force growth, low employment growth, and high unemployment rates and underemployment in terms of income level;

high labour force and employment growth and low unemployment rates;

low labour force growth, low employment growth and high unemployment rates (see ILO (Ed.) 2007).

Sandhaas and Winkler (2011) pointed out that that the labour market data in Ethiopia does not fully fit into one of the groups mentioned and is therefore not easy analyse (Sandhaas and Winkler 2011).

Hence, they point out that the critical issues regards the TVET system in Ethiopia have been and still are:

The organization of the TVET reform as a continuous national goal;

The provision of TVET (in particular by private providers);

The financing of the system

Winkler (2008) noted, the lessons learned with regard to the key components of success TVET reforms are still relevant for the future development of the Ethiopian TVET system (Winkler 2008:50-51). Sandhaas and Winkler (2011: 24) argue that supporting elements for a well-structured, organised, financed and regulated TVET system are diverse: Regarding this issues they quoted:

"Successful reforms appear to be those which combine public financing of initial or pre-employment training with rigorous evaluation of programme impact in design, and ensure competition between providers in delivery."

"Matching instruments e.g. public or private subsidies, to target groups are as important as choosing the best delivery mode." While mechanisms, through which TVET is supplied, are important, it is critical that these programmes target groups which will most benefit from them." The "usefulness of scientific evaluations" in matching instruments cannot be overemphasized".

Government's "role as a facilitator of information on the availability and effectiveness of vocational programmes" has been relatively neglected and thus resulted in "lack of reliable information on the effectiveness of public training programmes and the availability of privately provided TVET programmes." The practices of countries in all parts of the world show "that a strong political will to reform - not socio-economic and institutional factors - is the common determinant of successfully restructuring of TVET systems" (Sandhas and Winkler 2011: 24).

On the other hand, taking to account, the socio-economic environment and the contextual framework in which TVET delivery systems currently operating in Africa, the African Union in its report, Strategy to Revitalize Technical and Vocational Education and Training (TVET) in Africa (2007:6-7) summarized and explained the key issues of TVET system as follows:

The public i.e. families, community consider TVET as appropriate for only the academically less able. In many African countries, students entering the vocational education track find it problematic to proceed to higher education. Which shows that there is a necessity to make TVET less dead-end. Some vocational training programmes like hairdressing and secretarial science are linked with girls - very often girls who are less gifted academically. The delivery of quality TVET is reliant on the competence of the instructor; competence measured in terms of theoretical knowledge, technical and pedagogical skills as well as being up-to-date with new technologies in the workplace. In general, TVET forms a separate parallel system within the education system with its own institutions, programmes, and educators. This condition inclines to reinforce the perception of inferiority of the TVET. Consequently, it is found that it is important to create pathways between vocational education and general education. Last but not least, TVET programmes must have to be linked to the job market as the ultimate goal of TVET is employment. In this way, the socio-economic relevance of TVET can be enhanced (AU, 2007, p.6-7).

: Historical Framework of Technical and Vocational Education (TVET)

3.1 TVET Development of in Africa

The first conference of African States on education was held in Ethiopia in 1961. The conference obviously put the pitch in placing precedence on expanding general secondary and tertiary education (UNESCO, 1961), with a view to rapidly replacing the colonial human resource and additional expatriates in the civil service which in turn made vocational education and training in Africa a 'Second-rate Priority' in the education agenda (Wilson, 2005). After about a dozen years from the 1961 education conference, an enormous increase in the numbers of youth completing primary education and disentangled demand for secondary education was observed (Oketch 2007). These lead many independent governments in Africa to relapse to supporting TEVT on the basis of the production structure of their respective countries and the dwindling number government jobs (ibid).

Pioneer of TVET researcher in Africa, Philip Foster in 1965 argued that, it might be lucrative to support small-scale vocational training systems strictly linked with the continuing development efforts while very detached from the official educational system to alleviate the problem of youth unemployment (Foster, 1965). Mark Blaug who followed Phillip Foster later in 1973 argued that the expansion of TVET cannot be a cure for educated unemployment. It cannot prepare students for specific occupations and reduce the mismatch between education and the labour market (Blaug 1973). Foster's argument against government involvement in massive expansion of TVET despite its new found appeal after decades from independence supported by evidence from field research did not go with the assumptions about the benefits anticipated of TVET.

On the contrary, authors like Psacharopoulos (1997) believed that TVET would alleviate the mass problems of Africa by bringing about economic progress and youth employment by heavily inculcating technological knowledge. He based his argument by pointing out that as everyone cannot be academically successful, TVET would offer those students to achieve something who otherwise are cast as academically unsuccessful in the general education system (ibid). Even though authors like Wilson (2005) argued that, TEVT was seen as detrimental in post-independence Africa as it was linked with the colonial educational rule. He argued that Africans viewed TVET as a 'substandard education'. Oketch (2007) argued that, even where the context might have changed, African countries where the argument over whether to focus investment in general education or in TEVT has continued for over 40 years. Moreover, Blaug (1973) had argued that in general, both students and their parents instinctively knew that academic lines guaranteed a better livelihood than vocational education.

All in all, the current schooling structure in most countries leads to two courses: general education and vocational education (Oketch 2007). The general education enables students who gain access to it, to continue in their schooling to higher levels, while vocational education are for those students going directly to the world of work or to those who, due to limited general educational chances, are crowded out of the general education hierarchy (ibid). In some countries, it's the choice of the student to choose his/her pathway either to join general education or vocational education. However, for vocational students in most countries crossing the path to higher education is impossible (Atchoarena et al, 2001).

Radwan, Akindeinde et al. (2010) argue that in order for Africa to attain development, the youth need to have access to a learning that will facilitate the enhancement of their standard of living by gaining competitive skills that will be in high demand in the labour market. TVET is only one of numerous tools for employment creation (de Largentaye 2009). It is a well-known fact that vocational training can expand the attainment of suitable skills and thus raise labour supply and the "employability" of the work force. The demand for labour depends on variety of factors such as incentives for investment, the exchange rate, prices factors, personality traits, government and related entities support system, socio-cultural environment and the production and commerce environment in the country.

Dar and Tzannatos (1999) suggest that given that many countries around the world do put into practice these large scale programmes, a hard-headed approach should be whether the intended goal is met and at what cost, but not whether to just have them. Kingombe (2012) argues that, when setting up for large scale TVET programmes, policy-makers and decision-makers should be able to make knowledgeable and informed decisions that are held up by evidence-based information However, the same author notes that there is a scarcity of proof-based information about TVET mostly in SSA (ibid).

On different note, TVET globally has a low social acknowledgment (Grollmann and Rauner 2007). The differentiation in perception between TEVT and that of the academic education has more reduced the recognition that TVET deserves (Abebe 2010). Incidentally, Grollmann and Rauner ( 2007) stated that:

"The empirical importance of vocational learning is overshadowed by the big emphasis society puts on academic education and credits. Despite the fact that there are gradual differences regarding this structural problem, nevertheless this is one of the universal core problems. The "Parity of esteem" between vocational and general education is still wishful thinking but could never be established. Still in the international discourse the prevailing orientation is that vocational education is something old and traditional fitting to the needs of the pre-industrial and industrial societies but not to the so called knowledge societies and economies or that it is at best a solution for low-achieving students".

3.2 The Historical Framework of TEVT in Ethiopia

TVET in Ethiopia followed the school- based model of training beginning from the establishment of the system. The beginning of TVET in the formal educational scheme dates back to the founding of the 1st TVET School in 1942 in Addis Ababa which had the name Ecole National des Artes Technique (renamed later on as Addis Ababa Technical School). The school offered trainings in many occupational fields such as electricity, economics, wood work, secretarial science, accounting, auto mechanics, building construction, , carpentry. Qualified candidates were enrolled into the three-year training programme known as 8+3 program, and upon completion they were awarded diplomas.

Over the years, Addis Ababa technical school underwent a number of changes in terms of the trainings offered and their entry level and duration. The school offered the 8+4, 10+2, and 10+3 programs and applicants from many parts of the country with the best academic achievements competed for admission to the then prestigious school. In 1943, the Addis Ababa School of Business and Administration (later renamed Addis Ababa Commercial College and now currently named Addis Ababa University Commercial College was inaugurated with the aim of supplying trained personnel in the vocational fields of accounting and secretarial sciences for business and commerce, as well as for civil service. Later, banking and finance training fields were added. It offered trainings at the 8+4, 10+3, 11+3 and 12+2 levels. Currently, it offers Bachelor of Arts and Graduate degree level programs under Addis Ababa University.

In 1962, an educational reform in the country was made which saw secondary schools curriculum transform to a more inclusive education and training. This made TVET more available to students. Even though this reform was not well supported by the resources essential for its success, it was made with the intention that TVET will offer the chance for the secondary school students to join the world of work right after completion of secondary school. In reality, it was an alteration that offered the needed attention and credit for the significance of TVET in the education scheme (Abebe 2010). In 1963 the Bahir Dar Polytechnic Institute was established which further sustained the development of TVET in Ethiopia. This school was later upgraded to a higher education institution level and currently it offers Bachelor and Graduate degree level programs under the name Bahir Dar University. Abebe (2010) argues that no major institutional expansions or development agenda intended at developing TVET took place in the educational scheme between the mid-1960s and the mid- 1980s (Abebe 2010).

During the Derg regime (1974-1991), the MoE was cautioning the government of the educational crisis as early as 1980s, not only in terms of achieving Universal Primary Education (UPE), but also about the increasing unemployment of the secondary school graduates (Abebe 2010). The MoE had planned to reduce the pool of unemployment through the introduction of an 8-year universal polytechnic education that could help the student's transition to the world of work but the plan was not fully realized (Abebe 2010). After the down fall of the socialist Derg regime in 1991, the command economy was changed by the free market economy and the country was politically constituted as a Federal Democratic Republic country (Negash 2006).

In 1991, the then transitional government of Ethiopia (currently the EFDRE) introduced a new education policy that dramatically changed the education system was introduced in July, 1994. The policy included a major supply-side push on TVET to support the school-to-work transition. It aimed at tackling the educational problems of access, equity, relevance, and quality with the regional governments of the FDRE guaranteeing the rights of their people to be taught in their language and work in the direction of achieving access to education for all age cohorts in their regions (Abebe 2010).

Before 1994, primary school included grades 1-6, junior secondary included grades 7-8, and secondary school included grades 9-12. In grade 12, students took a school-leaving exam that determined their eligibility to pursue higher education. Only a small percentage of students could enrol in higher education. The majority of students left school without any readily marketable professional or technical skills. The new education policy aimed to change this picture by focusing on producing a skilled labour force rather than a large cohort of relatively unskilled secondary school graduates.

The current educational structure consists of eight years of primary education followed by four years of secondary education. The primary education has two cycles, first cycle (grades1- 4) and second cycle (grade 5- 8). The secondary education has also two cycles. The first cycle is the general secondary education (grade 9- 10) which leads to the end of the general education for all students. A national exam is given upon completion of grade 10, with those who score well promoted to the second cycle of secondary school (grades 11 and 12), which is considered college or university preparatory. Those who do not score well enough to continue in secondary school have the opportunity to pursue formal TVET, which takes one to three years. One- and two-year training programs

Figure 3.

Structure of the Ethiopian Education System

Source: Ministry of Education (MoE) 2009

3.3 Current Status of TEVT in Ethiopia

At a global Symposium on implementation matter of diversified financing strategies for TVET organized by the Ethio-German Engineering Capacity Building Program (ECBP) on November 20-21, 2006 in Addis Ababa, Ethiopia, it was decided amongst the nearly one hundred experts and practitioners from eleven countries and four continents who took part, that the Ethiopian approach to TVET reform and TVET financing are very much in line with international best practice in terms of performance (Kingombe 2012). All stakeholders at the above stated symposium seemed to agree that partnerships among the public sector, the private sector and civil society will be key in making any TVET reform process succeed (GTZ, 2006 as cited in Kingombe 2012).

Ethiopia has achieved the highest increase of 5,565 % in TVET enrolment from 1999 to 2007 from SSA countries and ranks the second among the countries in Africa in terms of number of training institutions. Further, the same author notes that, the recent growth in TVET enrolment and provision has been achieved by a substantial development of public spending and increased TVET provision by private institutions (ibid).

3.4 TVET Delivery: Formal, Non-formal and Informal TVET Sector in Ethiopia

TVET provision in Ethiopia comprises of all modes of formal, non-formal and informal trainings offered either by government and/or non-government providers such as non-government offices (NGO), and private institutes. TVET provision is open to a variety of groups such as illiterates, school leavers, school dropouts, farmers, entrepreneurs, and other groups (Biazen and Amha 2009).

Figure 3.

The Formal Route to TVET and Higher Education

World of Work

Higher education

TVET schools (Level 3,4 and 5)

Grade 11 & 12 (pre- university)

Students who pass EGSECE

Students who do not EGSECE

General Secondary Education (Grade 9-10)

Primary Education 2nd cycle (Grade 5-8)

Primary Education 1st cycle (Grade 1-4)


The formal TVET programs are for those students who have failed to achieve the Ethiopian General Secondary Ethiopian General Secondary Education Certificate Examination (EGSECE )scores for admission to preparatory program. Students in the TVET path could attend programs that range from one year to three years that would enable them to join the world of work. Working people also join the formal program through distance learning and evening classes. Informal TVET is described as those manoeuvres which are operating unregistered with a low level of organisation and are said to function mostly through home-based activities or in small channels without fixed locations. The government has small or no straight association with informal TVET in other words it is not supported or regulated by the government.

On the other hand the non-formal TVET is provided to wide range of target groups such as school dropouts, those with below grade 10 education or lower including illiterate people, unemployed, youth and adults, who could produce supporting letters from their respective woreda's. The training is offered through different channels (community based, institutional, apprenticeship) such as Community Skill Training Centres (CSTC), prisons, and farmers training centres. The trainings are offered over different periods of time from short-term courses of a few days to long-term pr