Does tech-voc education actually boost wages?

For many Filipino families, the question “What do you want to be when you grow up?” is almost always equated with “What college degree will pay the most?” This focus on college is understandable given the well-documented wage premiums of a degree. Little is said about alternatives in technical-vocational education and training (TVET), largely because we have not clearly understood its returns.

For the first time, we finally have the data to change that. Thanks to recent efforts by the Second Congressional Commission on Education (Edcom 2), Technical Education and Skills Development Authority (Tesda), Philippine Institute for Development Studies, and the Philippine Statistics Authority, the 2024 Annual Poverty Indicators Survey-Labor Force Survey finally included granular rider questions on TVET. We can now see exactly how specific national certificates (NC)—the primary document proving skills competency after training—drive higher wages.

Our analysis of this new data reveals three critical findings. First, simply showing up for training is not enough; only high-level certifications (NC III/IV) trigger significant wage premiums. Second, in some sectors like health care, failing to get certified can carry a wage penalty. Third, while most trades require a direct job match to pay well, information, communication, and technology (ICT) skills are portable, signaling a high level of digital literacy that the market rewards even in nontechnical roles.

The first finding is concerning: higher wages are associated almost exclusively with advanced NCs. For a typical secondary graduate, having no TVET leads to an average wage of P69 per hour. Those who attend TVET but do not get a certificate earn the same amount. Even those with NC I/II see only a marginal increase to P74 per hour. The significant wage premium is at the NC III/IV, where wages jump significantly to P96 per hour.

This tells us that the market is not just looking for training—it is looking for the mastery, autonomy, and specialized skills that come with advanced NCs.

However, getting that certificate is easier said than done. In sectors like health care and ICT, the certificate acts as a wage floor. In health care, a worker who took TVET but failed to earn their NC earns only P55.8 per hour—nearly P22 less than someone who never took TVET at all. The market may view uncertified participation as a negative signal of a worker’s inability to meet industry standards.

We also find that the value of a TVET course is unlocked in two different paths. For traditional trades like construction, you only see a wage boost if you work in that specific field—a “skills-job match.” A matched worker in construction earns about P11 more per hour than a mismatched peer.

ICT is the exception. In this field, mismatched graduates—those who took ICT TVET but often ended up in managerial or nontechnical roles—actually earn more (P87.3/hour) than those in technical ICT roles (P70.1/hour). In this case, an ICT certificate acts as a powerful signal of digital literacy, making the graduate valuable across the entire service economy.

The free NC assessments and the recent launch of the Tesda Skills Passport are big steps toward the right direction. By providing graduates with a verifiable, mobile record of competencies and prospective learners with recommendations based on local labor needs, we enable learners to unlock wage increases linked with TVET.

However, to unlock its full potential, a skills passport requires open borders across systems in our education and labor agencies. Historically, these systems operated in silos, causing learners to “disappear” from data as they transition between school and work. Though a learner is a single individual, fragmented databases treat them as disconnected parts, creating a significant barrier to our national education and workforce development goals.

This fragmentation limits our ability to understand why some learners fall behind. For example, we see the wage penalty for uncertified graduates, but we lack the linked data to understand the root causes—whether Pantawid Pamilyang Pilipino Program households skip exams due to costs or if early literacy gaps impact later certifications.

We cannot fix the foundations if we only look at one pillar at a time. This is the core mission of the Education and Workforce Development Group (EWDG)—it serves as a common ground where our education and labor agencies can finally harmonize the data that has historically lived in silos.

As we strengthen TVET as an alternative career pathway, we must recognize that evidence-based policymaking is only as strong as our ability to see the whole human being across systems. Harmonizing data throughout the learner lifecycle is the only way to ensure that no Filipino is trained for a dead end—that every learner’s journey is visible, valued, and rewarded.

The full policy note can be accessed at: edcom2.gov.ph/publications/

—————-

Kier Jesse Ballar is the research and data harmonization lead at EWDG. He previously served as a consultant for Edcom 2, where he authored a policy note on the wage returns of TVET.