The NSW State Government is promising that its plan to raise the school-leaving age to 17 will transform the future prospects of thousands of school students. If this works as intended, students who currently drop-out of school and end up in unskilled jobs or, worse, on long-term welfare payments, will benefit enormously from either completing the HSC or entering vocational education. Ultimately, these people will obtain skilled, more secure, and better paid jobs.

Employer groups have long being calling for an increase in the leaving age. They maintain that corralling more kids in school for longer will solve the chronic skills shortage that Australia has faced over the last decade or so of record economic growth. Premier Nathan Rees says he wants to arrest the state’s drop-out rate, which is presently the highest in the country, not only to ensure we are “smarter and more skilled to compete” in the global economy, but also to enable “all kids in NSW to have the best chance in life”.

The idea that is driving the government’s policy is that people end up in unskilled jobs or on welfare because they are under-educated. This is a fallacy. Forcing students who gain no benefit from additional formal education through extra years of schooling or training, in the vain hope this will equip them for skilled jobs for which they are unsuited, is pointless.

It seems obvious that the more education a person receives the greater the chances they will secure a “better” job. It is true that people who are capable of completing Year 12 and then going onto further education are less likely to be unemployed and are more likely to gain skilled and higher paid jobs. However, the government’s rationale for raising the leaving age is based on wishful thinking and is not supported by the evidence.

What the evidence shows is that for some people, staying longer at school provides no long-term benefit. In fact, for less-able students, who aren’t good at the exams and essays that higher education requires, more education leads to worse outcomes.

We know this thanks to research by the Australian Council of Educational Research, which has been tracking a sample of young people through school and into further education or employment.

The data reveals three key facts that directly contradict the arguments for increasing the leaving age. The ACER has found that students who complete Year 12 and then get a job do no better on average than those who left after Year 10 and got a job. It has also found that students who take up vocational courses after Year 10 do worse than those who leave and take up an apprenticeship. And students with low literacy and numeracy scores who finish Year 12 end up worse off than students of the same ability who leave early.

For this group of over-educated, low-ability students, their risk of unemployment turns out to be 3% higher and their weekly fulltime earnings turn out to be more than 2% lower for every additional year spent at school. In other words, “to have the best chance in life”, they would be better off leaving schooling, seeking employment, and acquiring on-the-job training.